Continued Government Subsidies Are More Crucial Than Achieving Consensus in Copenhagen

Perhaps most compelling, respondents believe that a resulting consensus and any subsequent changes in government policy from the United Nations Climate Change Conference in Copenhagen is not going to be as important as continued government subsidies and a general recovery of the credit and broader financial markets.

Investors are confident that government subsidies are likely to remain the same or increase. As a result, the investment community is positive in their outlook towards the broader CleanTech sector.

Commenting on these findings, Bruce Huber, Head of Jefferies’ European CleanTech investment banking group, said, "Europe continues to be perceived as a major innovation hub for CleanTech, which may be why continued incentive plans at the country level that nurtured the European CleanTech industry are seen as more crucial to investment and continued growth than the outcome at Copenhagen. What is clear is that both local government incentives and transnational policies aimed at putting the brakes on climate change are fundamental to the continued growth of the CleanTech industry."

Executive Summary

* Copenhagen is viewed as being less important to the sector than continued government subsidies and a recovery of the credit markets.
* Generally, respondents are positive in their investment outlook towards the sector, driven mainly by their confidence that subsidies are likely to remain the same or increase.
* Investors believe that government support and the availability of credit are the sector’s key growth drivers.
* The European IPO market for CleanTech is expected to reopen in 2010.
* The solar price war is expected to continue until Chinese companies have established cost leadership.
* Europe is seen as leading the pack ahead of the US and Asia in terms of driving innovation.
* Nearly half of the respondents believe that the mass adoption of electric vehicles is less than five years away.

The Jefferies CleanTech Survey was designed to gauge investor sentiment towards the sector in light of the financial crisis and identify areas of consensus. In addition, the survey was intended to provide insight into investors’ views towards the fundamentals driving certain subsectors of the renewable energy and sustainable technologies markets.

Jefferies, a major global securities and investment banking firm, has served companies and their investors for more than 45 years. Jefferies & Company, Inc. is the principal US operating subsidiary of Jefferies Group, Inc. (NYSE: JEF: jefferies.com), and Jefferies International Limited is the principal UK operating subsidiary. Jefferies International Limited, a UK-incorporated company, is authorised and regulated by the UK Financial Services Authority.

www.jefferies.com/