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Archive for the ‘enviro startups’ Category

photo: BrightSource Energy

I wrote this story for Grist, where it first appeared.

Some good news on the environmental front for a change: Global investment in green technology in the first quarter of the year spiked 52 percent compared to the previous quarter, to $2.57 billion. That’s according to a report released Tuesday by the Cleantech Group, a San Francisco research and consulting firm.

The increase represents a 13 percent jump over the first quarter of 2010, and indicates that investors’ appetite for renewable energy, electric cars, and other green technologies continues to rebound from the recession.

But the numbers aren’t exactly good news for entrepreneurs toiling away in their garages on the next new thing. The first quarter results show that investors are focusing on existing portfolios rather than financing a lot of new startups. In fact, 93 percent of that $2.57 billion represented so-called follow-on investments.

“In the first few months of the new year there have been a rash of large later-stage deals which have propelled 1Q11 to the second highest quarter ever for clean tech VC investment,” Sheeraz Haji, the Cleantech Group’s chief executive, said in a statement. “It’s encouraging to see some big private equity firms entering the space.”

So who got the money?

Solar companies were the big winners, taking in $641 million in 26 deals, according to the Cleantech Group. About a third of that went to a single startup, BrightSource Energy, the Oakland, Calif., solar thermal power plant builder. And venture capitalists seem to have a renewed appetite for cutting-edge thin-film photovoltaic technology, an area they poured a couple of billion dollars into back during the green tech boom. One such startup, MiaSolé, scored $106 million in the first quarter.

Electric cars also proved popular among investors as the new year got underway. Fisker Automotive, a Southern California startup building a super sleek plug-in hybrid sports sedan called the Karma, took in $150 million. At the other end of the electric spectrum, Coda Automotive, another SoCal startup, took in $76 million for its middle-of-the-road four-door.

Biofuels are back as well, taking in $148 million. The largest share, $75 million, went to a California company called Fulcrum Bioenergy, which is developing a process to turn municipal waste into ethanol.

North America still accounts for the lion’s share of investment — 85 percent in the first quarter, a 43 percent rise from the same period last year. And Silicon Valley’s Kleiner Perkins Caufield & Byers did the most deals — nine.

But in a sign that corporate America is increasingly seeing green tech as a good bet, GE Energy Financial Services took third place for the number of deals done.

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In The New York Times on Monday, I write about PlugShare, a new iPhone app that lets people share their household outlets and electric car charging stations with EV drivers:

First there was music sharing and then car sharing. Now get ready for plug sharing.

Xatori, a Silicon Valley software start-up, aims to create a network of electric car enthusiasts who make their household power outlets and home chargers available for drivers who need to top off their battery or who find themselves out of range of the few public-charging stations currently available.

On Monday, Xatori released PlugShare, a free iPhone app that lets drivers and outlet owners locate and offer electricity.

“We want to break down that barrier in people’s minds about where it’s acceptable to charge,” said Armen Petrosian, Xatori’s co-founder and chief technology officer. “We think the infrastructure to charge is everywhere.”

Drivers can punch in their destination to see the availability of shared outlets as well as public charging stations along their route.

People who want to share their electricity indicate what type of outlet or charger they have, how to gain access and their preferred method of contact. Given that most outlets are located in locked garages or otherwise behind closed doors, Xatori expects plug sharers will ask drivers to schedule a time to charge by calling or sending a text message.

“I think a big positive of using the app is that you get to connect with other E.V. owners,” said Mr. Petrosian.

In other words, think of PlugShare as a combination of FaceBook and Foursquare, the location-based service, for electric car owners and their supporters.

“People who don’t own an electric car can be part of the electric vehicle revolution,” said Forrest North, Xatori’s chief executive and the founder of Mission Motors, a San Francisco start-up developing an electric motorcycle.

But how much is it going to cost to take part in this revolution if the revolutionaries are giving away their power?

Not much, according to Xatori’s founders, who believe that most people will share their standard 110-volt household outlets. In the San Francisco Bay Area, for instance, they say it’ll cost on average about 15 cents an hour to charge an electric car. (Under a variable rate structure, that cost could go up if a household is a particularly heavy electricity user.)

“This is more like a backup network, like A.A.A.,” said Mr. Petrosian, who says he has a battery-powered Nissan Leaf on order. “Most of the time you’ll drive on energy from your own house. If you miscalculate, you can rely on the community.”

You can read the rest of the story here.

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photo: Todd Woody

In The New York Times on Friday, I write about a report showing venture capital investment in green technology companies nose-dived in the third quarter of 2010, with California taking a big hit:

Has the green tech recovery stalled?

Global venture capital investment in green technology companies fell 30 percent, to $1.53 billion, in the third quarter of 2010, according to a preliminary report issued Friday by the Cleantech Group, a San Francisco-based research and consulting firm.

The amount invested in North America, Europe, China, India and Israel in the third quarter is also 11 percent below the year-ago quarter, when investment tanked amid the recession.

The numbers are striking, given that investment in green-tech startups soared in the first half of this year, surpassing records set in 2008 at the height of the clean technology boom.

“Much like we see globally, I think businesses and investors are grappling a little bit with a recovery that hasn’t yet taken off, and I think people are trying to figure out how quickly will the growth occur,” Sheeraz Haji, president of the Cleantech Group, said during a conference call Friday. “I think we’re seeing a little bit of the same in clean tech.”

California, an epicenter of green technology innovation, suffered a precipitous decline, with investment falling 61 percent.

Mr. Haji questioned whether uncertainty over the fate of California’s global warming law, known as A.B. 32, played a role in the falloff in investment. A measure on the November ballot, Proposition 23, would suspend A.B. 32 until the state unemployment rate falls to 5.5 percent for four consecutive quarters.

“We can’t help but wonder that uncertainty around Prop 23 has impacted that,” he said, cautioning that it is difficult to draw hard conclusions based on one quarter’s data. “

The global warming law requires California to cut its greenhouse gas emissions to 1990 levels by 2020. Mr. Haji noted that venture investment soared after the law’s enactment in 2006 as investors poured money into solar startups and companies developing energy efficiency services and electric cars.

Even so, investors put $452 million into California companies in the third quarter, versus $126 million for second-place Texas.

While the rest of North America experienced a rise in investment in the third quarter, California’s poor performance led to a 42 percent decline for the region as a whole.

Not so with Asia. For instance, investment in China jumped to $153 million in the third quarter from $30 million in the second quarter of 2010.

You can read the rest of the story here.

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photo: EcoVeggies

In The New York Times on Monday, I write about how Newark is becoming a hotbed of sustainable agriculture, or Ag 2.0:

On the rooftop garden at St. Philip’s Academy, a private school in Newark, students tend plots of everything from broccoli and beets to sweet corn and spaghetti squash.

But since August they’ve also been helping to farm arugula, chervil, fun jen, and komatsuna in a machine installed in a fourth-floor science classroom that grows crops without soil or sunshine.

Made by an Ithaca, N.Y., company called AeroFarms, the aeroponic growing system is owned by EcoVeggies, a startup formed by former three Wall Street technology workers who aim to transform Newark’s abandoned and vacant buildings into so-called vertical farms.

“The produce will sold and used in the areas immediately surrounding Newark to start with and then we expect to be able to service the immediate tri-state area,” Richard Charles, one of EcoVeggies founders, wrote in an e-mail message.

At St. Philip’s Academy, leafy greens are planted in a cloth bed and irrigated with a nutrient-infused mist. Light is provided by LED lamps, which are more energy-efficient than conventional lighting and can be placed closer to the beds. The LED lamps also provide pest control, according to AeroFarms’ chief executive, Ed Harwood, because they can be set to emit certain wavelengths that disrupt insects’ breeding.

AeroFarms is leasing the machine, which stands 7 feet tall by 10 feet long, to EcoVeggies for use in the pilot project at St. Philip’s. It can produce about 20 pounds of produce per harvest, Mr. Charles said.

EcoVeggies and AeroFarms are part of the sustainable agriculture movement, sometimes called Agriculture 2.0, which seeks to combine technology and organic farming to grow crops in urban areas that often lack access to fresh food.

You can read the rest of the story here:

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photo: Todd Woody

I wrote this story for Grist, where it first appeared.

The anemic economic recovery may have hit the dog days of summer with consumer spending and factory orders slowing, but the new energy economy continues to surge, according to a report released Tuesday by Ernst & Young.

Venture capital (VC) investment in renewable energy, electric cars, energy efficiency, and other green technology jumped to $1.5 billion in the United States in the second quarter of 2010, a nearly 64 percent spike over the second quarter of last year. Green tech investment now has returned to the record levels of the third quarter of 2008, before the global economic collapse shut down the VC’s ATM.

So where’s the money going? Between March and June, at least, investors hitched a ride with startups developing electric cars and the infrastructure to support them. Better Place, the Palo Alto company building electric vehicle charging networks around the world, snagged $350 million. Fisker Automotive, a Southern California startup building a sexy and pricy plug-in hybrid sports sedan called the Karma, scored $35 million, according to the report.

Solar remains a hot opportunity for venture capitalists, with nearly $439 million invested in the second quarter, a 183 percent increase from the year-ago quarter.

It’s no coincidence that the beneficiaries of investors’ largesse are also those startups that received federal loan guarantees to build big solar power plants. (Raising additional capital usually is a requirement for obtaining such federal loan guarantees.)

BrightSource Energy, for instance, secured a $1.37 billion loan guarantee from the U.S. Department of Energy to build its first solar power plant, now undergoing licensing in California. It then quickly raised $180 million from investors.

VCs also continue to pour cash — nearly $200 million in the second quarter — into energy efficiency startups, which tend to be far less capital-intensive than renewable energy companies.

So it’s a good time to go pitch that great green tech idea you’ve been kicking around, right?

Not necessarily. Ernst & Young notes that nearly 59 percent of investment in the second quarter went to so-called later-stage startups that are well on their way to rolling out products.

In other words, venture capitalists seem to be more interested in priming the pipeline for initial public offerings or acquisitions that will produce a big pay day than in financing what green tech investor Vinod Khosla calls “science experiments.”

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This post first appeared on Grist.

I usually don’t write about companies’ funding announcements, unless the amount of money raised is particularly eye-popping. But when Recurve announced Wednesday that it had scored $8 million in its latest round of fund-raising, what caught my attention was who decided to invest in the San Francisco energy retrofit startup.

Along with the venture capital firms re-upping their investments — RockPort Capital Partners and Shasta Ventures — was a new investor, Lowe’s.

That the home improvement giant — $47 billion in sales, 1,700 stores — would invest in a relatively small “green energy remodeling” outfit is a sign that it sees potential in energy efficiency, at least enough to dip its corporate toe in the market.

The investment comes as companies like Recurve push Congress to pass legislation that would establish a $6 billion energy retrofit program called Home Star.

“Lowe’s 60-year history in the home improvement industry will be valuable in shaping Recurve’s growth,” said Pratap Mukherjee, Recurve’s chief executive.

Formerly called Sustainable Spaces, Recurve takes a Silicon Valley approach to energy retrofits. While the startup performs energy audits and dispatches crews to upgrade homes’ systems, it has also has developed software to automate the whole retrofit process for other green building companies in an industry dominated by mom-and-pop shops.

The software, delivered over the Internet, lets retrofitters enter data on a home’s energy profile in a laptop or handheld device during an audit, run electricity consumption simulations, calculate estimates and equipment needed for a retrofit, and generate reports for customers on the spot.

Contractors, of course, then can head down to their neighborhood Lowe’s to buy ducts, insulation, and other materials needed for a retrofit job. Which, in the end, may be one return on Lowe’s investment in Recurve.

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photo: Skyline Solar

This post first appeared on Grist.

Grist’s David Roberts sent out a Tweet to his Tweeps today asking which city has installed the most solar. I’ve got an answer for you, David: Nipton, California.

The desert micropolis – population 38 – announced Thursday that it had installed a solar array that will provide 85 percent of its electricity. (The population of the outpost on the edge of Mojave National Preserve spikes to 250 or so during tourist season.)

The solar system is ground-mounted rather than on rooftops and only generates 82 kilowatts. But what is notable is the technology developed by Skyline Solar, a Silicon Valley startup I first wrote about for Grist last year.

The company’s power plants resemble solar thermal parabolic trough installation that deploy long rows of mirrors to heat tubes of liquid suspended over the arrays to create steam that drives an electricity-generating turbine.

Skyline’s system is purely solid state, however. Each 120-foot-long trough concentrates the sun on photovoltaic modules attached to the edges of the arrays. That boosts the solar cell’s electricity production as does a tracking mechanism that allows the arrays to follow the sun throughout the day.

Such concentrating photovoltaic systems – which Skyline calls “high gain solar “ – have been a niche market due to their relatively high costs. But as solar cell prices decline and solar thermal projects get bogged down in environmental disputes, they have become increasingly attractive as they can be built near utility substations and plugged directly into the grid without the need to build expensive new transmission systems.

Skyline has pushed to lower costs by using common materials – glass, steel – and designing the arrays so their components can be mass-produced by automotive manufacturers. The company last year struck a deal with the Michigan subsidiary of Canadian auto manufacturing giant Magna International to make components for its HGS 1000 solar system.

In other news on the solar frontier Thursday, Silicon Valley startup MiaSolé said the National Renewable Energy Laboratory had confirmed that the company’s copper indium gallium selenide solar cells have 13.8 percent efficiency in production. Such thin-film cells typically have a lower efficiency than standard polysilicon solar cells but are cheaper to manufacture. But with an efficiency approaching 14 percent, MiaSolé could give some standard module makes a run for their money.

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In my new Green State column on Grist, I write about GreenRoad, a Silicon Valley startup that uses technology to change drivers’ behavior to cut fuel use — and greenhouse gas emissions — as well as accidents:

I recently took the Chevrolet Volt for a spin near San Francisco’s ballpark, checking another item off my electric-car life list. (Getting to drive pre-production EVs is one fringe benefit of covering green tech.)

Then the other week, I took a drive in another car that promised to help cut greenhouse gas emissions. The car itself was unremarkable — a Lexus RX hybrid that anyone with a spare $42,000 can buy. What was potentially revolutionary was the little black box sitting on the dashboard to the left of the steering wheel.

The box had three lights and when the car’s driver makes a fuel-wasting or dangerous move, such as slamming on the brakes, making fast, sharp turns or weaving through traffic — the LEDs go from green to yellow to red.

See, the problem, dear reader, isn’t just your carbon-spewing car, it’s you.

“There are habits that people fall into that they get away with all the time and by making slight changes in those habits you crash a lot less often and you burn less fuel,” says Dan Steere, chief executive of GreenRoad, a Silicon Valley startup that installs that little black box and other technology in commercial vehicle fleets. GreenRoad is backed by Richard Branson’s Virgin Green Fund and Al Gore’s Generation investment firm.

The road to a sustainable future, in other words, will be paved not just with shiny new gadgets that help cut fossil-fuel consumption, but also by new technology designed to change people’s planet-unfriendly behavior.

“Most of the focus around safety and fuel consumption has been about making a vehicle less lethal when it crashes or inventing entirely new systems like the Volt to try and make the vehicles better,” says Steere. “Ninety percent of crashes are caused by a bad decision the driver made, and the EPA has said that 33 percent of fuel consumption is due to driver behavior.”

GreenRoad attempts to change drivers’ fuel-wasting ways by giving them constant feedback — the little black box — and by sending them weekly emails that analyze their driving and offer tips for improvements.

The payoff for GreenRoad’s corporate customers, according to Steere, is fewer accidents and a lower bill at the pump, all without having to make capital investments in new vehicles.

You can read the rest of the column here.

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photo: Todd Woody

Green Wombat has been in transition so I’m a bit behind on posting. In case you missed it, in the Sunday New York Times on May 9, I wrote a profile of David Gelbaum, one of the nation’s biggest — and until now — most reclusive green technology investors and environmental philanthropists:

AMID the $6 million homes perched on a beachfront cliff in this conservative Southern California enclave, the seven-year-old Honda Civic hybrid with the Obama bumper sticker is the giveaway.

It’s not the usual drive of choice for wealthy former hedge fund managers like David Gelbaum. Then again, there’s not much that is business as usual about Mr. Gelbaum, an intensely private person who happens to be one of the nation’s largest — and largely unknown — green technology investors and environmental philanthropists.

Mr. Gelbaum has invested $500 million in clean-tech companies since 2002 through his Quercus Trust, amassing a portfolio of some 40 businesses involved in nearly every aspect of the emerging green economy, be it renewable energy, the smart electric grid, sustainable agriculture, electric cars or biological remediation of oil spills. He has poured almost as much into environmental causes.

“I think his impact on green technology is huge,” says Bill Gross, the serial technology entrepreneur and founder of eSolar, a solar power start-up in which Mr. Gelbaum has invested. “He is supporting bolder and riskier bets, and he’s doing it from a different filter than a traditional venture capitalist, and I think that makes a wider opportunity for success.”

In this economic downturn, many venture capitalists have grown cautious about putting money into what Vinod Khosla, the prominent Silicon Valley green tech investor, calls “science experiments.” But Quercus Trust is still taking chances on blue-sky start-ups pursuing technological breakthroughs.

Working outside the clubby venture capital network, Mr. Gelbaum has, until recently, maintained an obsessively low profile. In Silicon Valley, he remains something of an unknown. Associates say his near-invisibility is owed to a genuine modesty and concerns over the security of his family because of his wealth. Recipients of his philanthropy, for instance, signed confidentiality agreements that forbade mention of his name.

Mr. Gelbaum says he decided to break his long silence upon becoming chief executive in February of Entech Solar, one of his portfolio companies that is publicly traded. “This is what’s best for the company,” he says, pointing out that Entech benefits if he maintains a more public profile.

It is too early to predict whether Mr. Gelbaum’s big green bets will pay off. But he’s been capitalizing on two trends: the rapid decline in the price of photovoltaic power, and a focus on cutting capital costs as solar power competition with China intensifies.

His environmental philanthropy also gives him an influence beyond laboratories and boardrooms. He has given $200 million to the Sierra Club and $250 million to the Wildlands Conservancy, a land trust he co-founded that has acquired and preserved 1,200 square miles of land in California, including more than a half million acres of the Mojave Desert.

You can read the rest of the story here.

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photo: Aurora Biofuels

As I write in The New York Times on Friday, it’s spring cleaning at three renewable energy firms as top executives depart SolarReserve, Clipper Windpower and Aurora Biofuels:

The past week has brought a spate of executive departures at renewable energy startups, with the president of SolarReserve, a power plant builder, and the chief executives of Clipper Windpower and Aurora Biofuels stepping down.

Terry Murphy, a rocket scientist who co-founded SolarReserve after a career at United Technologies’ Rocketdyne division, has started a new venture called Advanced Rocket Technologies in Commercial Applications, or ARTiCA. The firm will evaluate green technologies for entrepreneurs and investors, according to Mr. Murphy.

Mr. Murphy and SolarReserve both said the departure was voluntary. “With the company solidly executing on its business strategies, Mr. Murphy has transitioned to an external role in providing developmental expertise to other early stage clean energy companies,” wrote Debra Hotaling, a spokeswoman for SolarReserve, in an e-mail message.

When Mr. Murphy left Rocketdyne to start SolarReserve, the startup licensed Rocketdyne’s molten salt technology so that its solar power plants could store solar energy for use after the sun sets or on cloudy days.

“SolarReserve, in my opinion, is up and running on all four cylinders,” said Mr. Murphy.

“What I did at Rocketdyne and what I did at SolarReserve and what I’m looking at doing in the future is to sift through technologies to find those that can be commercialized.”

Mr. Murphy’s new firm will focus on technologies involving renewable energy, desalinization and sustainability, he said.

You can read the rest of the story here.

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