Tuesday, July 08, 2008

Monetizing Green

"Green fever" continues to pop up in the unlikeliest of places-- well, perhaps not so unlikely if you think about it. No longer a passion project for environmentalists and politicians, green energy is a cash cow for companies throughout the private sector.

The ethanol boondoggle has been well documented here and elsewhere. Companies have tripped over themselves to cash in on that government subsidy. An entire subset of the venture capital industry has gone green. Automobile manufacturers have been quick to embrace hybrids and other green technology. Now... the insurance industry has figured out how to get in the game.

Fireman's Fund Insurance Co. is targeting environmentally conscious homeowners with a new insurance product that would cover the cost of rebuilding a home to green building standards. The green coverage, however, is only being offered as an add-on to the company's top-tier homeowners insurance package. It would cost $25 a year to add the coverage for a home with a replacement cost valued at $500,000 or less.

Insurance companies typically don't do anything that isn't going to make them a pile of money so-- depending on your point of view-- this is either a great example of incentivizing consumers to "go green" or it is blatant corporate exploitation.

Regardless, look for more examples of companies going for the green by going green.