Venture capital firms pumped $2.6 billion into green IT in the first nine months of 2007, topping their total investment in the area last year.

In the wake of Al Gore's Nobel Prize-winning crusade on global warming and oil prices reaching all-time highs, the investments give more credibility to the financial viability of using eco-friendly technologies, which many businesses have cited in reducing power consumption and costs, particularly in data centers.

Venture investments this year mark a 46 percent increase over their expenditures for all of 2006, according to new figures from Thomson Financial and the National Venture Capital Association. Investments in green IT, also known as "clean tech," first topped $1 billion last year.

U.S. companies garnered almost $1.7 billion of those investments this year, followed by firms from the Netherlands, Brazil and China.

Solar energy took in more money ($664.6 million) than any other sub-sector, according to the report. Alternative energy firms netted $317.5 million, and power suppliers grabbed $183.9 million.

Despite the record venture capital investments, some are voicing caution. "There are major opportunities for venture capitalists to totally reshape the energy market throughout the world as governments, consumers, and companies are demanding innovation in this space," says Mark Heesen, president of the NVCA. "However, as has been demonstrated in the IT and life science arenas, investing in new technologies can be fraught with pitfalls and is not for the inexperienced or the faint of heart."

This fall, CIO Insight looked at whether businesses were investing in green IT out of eco-friendliness or pure business gains. Michael Maoz, a vice president with Gartner, pointed to the latter. "(Businesses) like the fact that they can point to being greener, yet internally, it's been all about techs to reduce cost," he says. "If they get a cost premium and a PR boost, then why the heck not? It's a derivative that they have a green IT dividend."

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