If Israel truly wants to lead the world in clean tech investment and innovation, there must be state support.

Many articles have been written claiming that Israel can become a leader in clean technology over the next 10 years. Maybe yes, maybe no.

To make such a prediction with any degree of accuracy, we need to define “clean” technology. To date, clean or green technology, often referred to as “clean tech” comprises several categories and sub-categories including, although not exclusively:

• Renewable energy (solar, wind)
• Energy efficiency
• Storage
• Pollution remediation
• Water purification/desalinization
• Agricultural advancement

Part of the challenge of establishing a center of excellence for clean tech is that, unlike information technology, its genesis can take place at any university or laboratory around the world. The necessity for a Silicon Valley or Route 128 has been reduced by the fact that electrical engineering is no longer the only academic background required to solve environmental and energy challenges.

Microbiology and chemistry graduates are more likely to find employment at clean tech startups than are their electrical engineering counterparts. Thanks to the internet a clean tech universe has been created, and companies are cropping up all over the globe, with no apparent bias toward any particular climate or time zone.

Why Israel might be a clean tech epicenter

Some factors make certain sectors more conducive to leading in clean or green technologies. Solar technology in the Middle East is one example. Due to advances made because of Israel’s urgent need for reliable solutions to deal with its own environmental challenges (mainly the water crisis) the country’s clean tech market has become very attractive to foreign investment.

Despite being one of the world’s most arid regions, experiencing ever-increasing water consumption and alarmingly low levels of rainfall, Israel has succeeded where others have failed.

Water demands have been met over the past few decades by effective water management, including rain harvesting, flood reservoirs and the introduction of innovative irrigation methods to serve the needs of agriculture. Significant advances have been achieved by Israelis in desalination of seawater, recycling and purifying of municipal wastewater, and reclaiming of sewage water.

At least 30 percent of agricultural water is drip-irrigated to orchards and non-food crops. Relatively speaking, Israel has devoted more resources to the development of wastewater treatment and reclamation than any other country in the world.

Israel also has a head start in the solar thermal realm, as nearly all apartment buildings in the country have simple solar thermal panels on their roofs. Motivated more by the will to survive than by a hunger to address environmental issues, Israel has more reason than most nations to wean itself off crude oil.

While every country wants to lessen its dependence on crude oil, for Israel, it’s personal. This may prove to be one of the most compelling arguments for why the relatively small nation state may indeed become the next epicenter of clean technology innovation. Israel is home to Ormat, one of the leading companies in the world for geo-thermal power plants and recovered energy. In agriculture, Israel is the birthplace of and world leader in drip irrigation, literally turning a desert into an agricultural country. Netafim is the leading company in the world in this field.

In the energy storage arena, Israeli company Tadiran has become one of the leaders in long-life industrial strength batteries. Israel’s strategic location, with easy access to both Asia and Europe, has enabled these companies to garner customers on several continents while operating from home.

But where are the clean tech entrepreneurs?

However, to date there are no leading Israeli solar power companies on the market. There is an innate inertia at work in Israel cautioning the country to adhere to what it knows best – IT and telecom – while stifling potential investment and diversion of talent to clean technology. While there is no shortage of smart scientists and clean tech research, there is a surprising lack of clean tech entrepreneurs.

Historically, Israelis have been skilled at improvisational thinking within an already established category (think ICQ). Clean tech, however, is a completely new paradigm that requires category builders more than improvements.

One need only look at the mass of “technology refugees” to see that Israelis have been slow to adapt to the new opportunities in clean technology.

Conversely, technology entrepreneurs in the US have been migrating to the clean technology sector in greater numbers. Part of the reason that this migration has been slow in Israel is that the Israeli entrepreneurs and scientists are too isolated from one another.

Overtures from one side to the other are lacking. Furthermore, scientists are slow to leave their tenured posts at universities for business ideas that are, admittedly, still a few years away from proving themselves.

Lastly, Israel is a small country. Currently, there just aren’t enough demonstration projects to show to the rest of the world. Without the significant helping hand of a large government endowment, Israel’s chances of competing with the likes of the US, China and India seem unlikely.

The same location that provides regular and dependable exposure to the sun leaves Israel in a region of the world almost bereft of wind, when compared to Europe and the Americas. Not surprisingly, there isn’t much wind energy in use, nor are there many wind experts.

More “dating” between university researchers and entrepreneurs is the only way to create a marriage of industry and science. Also needed is a shift in focus from the Office of the Chief Scientist. More grant money should be in the hands of clean tech companies (currently it represents less than 15%) if Israel is to distinguish itself from its competitors.

In summary, Israel must realize that clean tech is certain to be one of the growth industries of the next 10 years, but to truly lead the world in clean tech investment and innovation, there must be greater support from the state.