Friday, 24 April 2009

Clean Sweep 60

A round-up of recent news in clean technology and cleantech investment.

Wednesday's underwhelming Budget promised new funding mechanisms for two to four carbon capture and storage (CCS) projects, plus £90m for preparatory studies. The following day, energy secretary Ed Miliband fleshed that out by announcing that all new coal-based generation in the UK must have some CCS capability. Existing plant will be retrofitted within five years of the technology being judged as technically and commercially proven.
And there's the rub - the technology on the scale required doesn't actually exist as yet. There'll be big opportunities for anyone who can provide the necessary, whether complete systems or critical components.
For more information, see the government's CCS consultation page

And as if by magic, US CCS developer Powerspan announced a $50m new funding on the same day as the UK plans were unveiled. New investors George Soros, Tenaska Energy, AllianceBernstein and Persimmon Tree Capital join existing backers including RockPort Capital and NGEN Partners.
The new money helps the New Hampshire company commercially deploy its electro-catalytic CO2 capture technology for coal-fired plants. The tech is currently being tested at a 1MW pilot plant in Ohio, with a 120MW commercial demo scheduled for 2012. The captured gas will be used for what Powerspan calls 'enhanced oil recovery operations' - pumping into oil reservoirs to help pump the hydrocarbons out.

Solar thermal tech developer Ausra secured new equity funding of $25.5m from Khosla Ventures, KPCB, Generation Investment Management, Starfish Ventures and KERN Partners. All took part in the Californian firm's previous $60m round in October 2008.
The new funding comes four months after Ausra announced a major change of strategy, from building and operating large solar thermal plants to supplying tech and hardware to industrial and utility customers. The firm is still developing a contracted 177MW plant for Pacific Gas and Electricity.

Green chemicals developer GlycosBio raised a $5m first round led by Draper Fisher Jurvetson. The funding goes towards hiring technical staff and scaling up production.
Texas-based GlycosBio uses bacterial fermentation to produce precursor chemicals for biofuel and biochemical refineries. The firm says it can use a range of low-quality materials as feedstock, including cellulosics and algae, and generally be a lot cleaner than the traditional petrochemical sources.

Battery manufacturer A123 Systems raised $69m from General Electric and other VC and corporate investors. The money goes towards new factories - the Massachusetts-based firm also announced it had secured $100m tax credits from Michigan to support construction.
A123 produces lithium-ion batteries based on its proprietary Nanophosphate technology, which the firm says can provide higher voltage and longer life than competing systems. It recently won a contract to provide batteries for Chrysler's forthcoming hybrid electric vehicles.

'Energy intelligence' group EPS Corp raised a $30m second round led by Altira Group. Previous investors NGEN Partners and Robeco also joined in.
Founded in California in 2001, EPS produces software-based systems to help blue chip companies analyse and manage their energy use.

Energy efficient lighting group Luxim announced it had completed its $12m third round, led by Sequoia Capital.
California-based Luxim is developing what it calls a new class of solid-state plasma light sources, boasting high efficiency, long life, and full-spectrum light quality.

In an interesting seed investment, Polaris Ventures has backed 'solar fuel' start-up Sun Catalyx with a reported $700,000. Details are sketchy, but the company is headed by MIT professor Daniel Nocera who has developed a new catalytic method to produce split hydrogen from water. This could be a highly efficient way of storing the energy generated from solar PV. MIT's Technology Review has a good overview of the tech.

Further reading
New Energy Finance have released their Q1 figures (28kb pdf) for new investment in clean energy - $13.3bn, a 44% plunge from the previous quarter and 54% down on 2008Q1. As well as a sharp drop in underlying activity, NEF analysts say that deals are taking longer to complete. VC and private equity deals held up relatively well, however, slipping 22% to $1.8bn, the lowest level for two years.
Another couple of US sources also released quarterly stats. Dow Jones VentureSource's tally of US VC activity counted nine renewable energy deals worth $117m, a 73% drop in value from 2008Q1. PwC and NVCA's MoneyTree Report (34kb pdf) meanwhile counted 33 cleantech deals and $154m, down 84% from 2008Q4 and the lowest cleantech total since 2005. Rob Day of Cleantech Investing ponders what it means.

Following the UK government's announcement on promoting electric cars, the UK Energy Research Centre weighs in:
"There is no point forcing car makers to produce low carbon options if no-one will buy them, so it is right that ambitious regulation is combined with grants and other incentives – including taxes on gas guzzlers - to deliver a transformation of the car fleet. But there is a bigger picture. If car travel becomes cheaper overall and car dependence grows then all our efforts to reduce emissions get harder and may take too long."

An interesting new publication - Clean Tech Law & Business, which claims to be the first peer-reviewed journal devoted exclusively to the pursuit of environmentally sustainable technology. The first issue focuses on carbon trading (and, on that subject, here's a provocative comment piece in last week's New Scientist from NEF's Andrew Simms).

Environmental Finance reports that the Norwegian government's plan to invest NKr20bn (£2bn) of its pension fund in sustainable investments is potentially the largest such allocation ever made. Private equity comes near the top of the list of potential asset classes.

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