Clean tech start-ups have gotten a bad rap thanks to notable failures such as Solyndra, Beacon Power, and Ener1 subsidiary EnerDel, all of which collectively received hundreds of millions of dollars from the Department of Energy before going belly up.

And they're not the only ones. Solar module maker Abound Solar, which received a $400 million Department of Energy loan guarantee, announced last month it is laying off 70% of its Colorado workforce blaming competition from Chinese manufacturers. It’s not a Solyndra yet; in the next six to nine months the company promises to make a better, cheaper product.

With all the trouble the DOE has backpeddled on funding start-ups. Next Autoworks, Aptera Motors, and Bright Automotive are a few that have had to pull the plug on their plans to make eco-friendly cars after either giving up on or being refused loans from the agency.

Yet in spite of all the doom and gloom, not everyone is skittish about clean tech. In fact, some in the industry are positively enraptured with the possibilites.

Reducing Dependence on Foreign Oil

Avi Yashchin is one such proponent. CEO of the clean tech training company CleanEdison, Yashchin is passionate about sustainability and sees American investment in the space as a way to save the country on a couple of different fronts.

He points out that the United States spend $600 billion a year on foreign oil and another $200 billion defending it. Meanwhile, Middle Eastern companies on the other end of that money are also buying up chunks of U.S. companies such CitiGroup and International Lease Financing Corp., the world’s largest owner and leaser of airplanes.

“I really think you have one of the world’s greatest transfers of wealth ever happening… and it needs to stop and I’m going to try [to do something about it],” he says.

The clean tech industry, he explains, was born out of the oil embargo back in the 1970s when long lines at the gas pump made America's dependency on foreign oil crystal clear. But even though things like solar panels and wind-powered generators were invented then, the technologies didn’t really take off because oil prices dropped considerably and stayed low for a long time.

Until recently, that is. In 2005 Goldman Sachs analyst Arjun N. Murti predicted oil would hit $105 a barrel, which it did—and then soared to $150 a barrel in the summer of 2008.

Suddenly clean tech was hot again and investors wanted in on renewable infrastructure opportunities.

Until all the bankruptcies, that is.

Competing on Cost

Even so, Yashchin insists clean tech can be profitable now. There are a few examples to back him up: Wireless lighting controls company Adura Technologies and LED lighting company Albeo Technologies are a couple that have recently boasted tremendous growth in sales and revenue.

Looking ahead, he sees clean energy sources becoming much more cost competitive, especially if the price of oil again hits 2008 levels.

What’s confounding, he says, is that the price of oil remains so high even though the global economy is still largely in the can. What’s going to happen when the billion middle class people in China and India start to boost the demand for goods? The price of oil is only going to trend upward, Yashchin says.

“All it takes is a shock to [the price of oil, natural gas, or technology like solar panels] and clean tech all of the sudden becomes wildly, wildly profitable,” he says.

Creating Jobs

Not only does Yashchin think clean tech is a sound bet, he also sees it as a significant source for American jobs.

In three years his company, CleanEdison, has trained more than 10,000 students in 49 states to do things like install solar panels and conduct energy audits. The demand for training is there, which is good news for his company—it pulled in $3.5 million in 2011 and has doubled in size every year since launching.

“When we train people to go install solar panels it’s improving the domestic housing stock,” Yashchin says. “And these are jobs that will never go to India.”

What America really needs, he says, is a new industry to take the place of home building and manufacturing, both of which aren’t coming back. Clean tech, he maintains, can be that industry.

The Funding Is There

Mitch Lowe, managing partner of the San Francisco-based clean tech accelerator Greenstart, has no qualms about investing in the space now. In fact, Greenstart is taking applications for its third round of companies to go through its program, which offers start-ups the opportunity to receive a $100,000 convertible note in addition to a $15,000 seed investment upon joining. (The deadline to apply for Greenstart’s fall program is April 11.)

Greenstart invests in companies innovating in cleantech and IT, primarily in four areas: smart grid, the built environment, transportation, and consumer services.

“The right software solutions will drive innovation, making clean tech the biggest investment area of next 10 years and beyond,” Lowe says. “It's going to make Web 2.0 look tiny by comparison,” Lowe says.