Friday, 26 June 2009

Clean Sweep 65

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

Cambridge solar tech start-up Enecsys has raised a £6m first round led by Wellington Partners. Denmark's BankInvest New Energy Solutions also joined the round.
A spin-out from the University of Cambridge, Enecsys is commercialising a micro-inverter for solar PV modules. By getting rid of components such as electrolytic capacitors which have a short expected lifespan, the company says its 'PVKey' inverters can match the 20-year-plus life of a basic PV module, with cost savings of up to 25%.
The deal comes just weeks after a rival micro-inverter developer, California-based Enphase Energy, raised a $22.5m third round.

Wellington Partners also joined Kleiner Perkins and Munich Venture Partners in an undisclosed round in German biomass gasification firm Agnion.
Agnion is commercialising a heatpipe reformer developed at the Technical University of Munich to produce syngas from wood pellets. The firm says the reformer, when coupled with a fuell cell in a small-scale CHP unit, can achieve electrical efficiency of up to 35%, comparable with that achieved in large installations.

London-based VC Frog Capital has doubled its stake in specialist waste recycler SiC Processing after buying out other shareholders.
Frog (then known as Foursome Investments) joined a Euro53.4m round in SiC in October 2007, led by Zouk Ventures. Merrill Lynch Corporate Principal Investments Group, CC Private Equity Partners and Masdar Clean Tech Fund also invested, alongside existing investors and the founding Heckmann family. Frog hasn't croaked on which shareholders it bought out, or what it paid.
SiC, based in Germany, operates an international network of silicon carbide slurry recycling plants for the solar and semiconductor wafer industries.

Dutch renewable energy developer Econcern, which raised a whopping Euro300m from institutional investors in May last year, has declared bankruptcy. Energy group Eneco has taken on the bulk of its wind, solar and biomass operations, while Orbeo takes over the OneCarbon offsetting division.
Econcern announced a major restructuring in April, blaming the credit crisis and recession.

A busy week for clean car developers. Norway's troubled Think raised NKr250m (c£23m) capital from new and existing investors. The firm, backed by a heavyweight array of VCs and corporate investors including DFJ, Rockport and GE, says it can now get closer to resuming production and start delivering vehicles this year.
California's Tesla Motors, which is collaborating with Think on batteries, meanwhile secured $465m low-interest loans from the US Department of Energy.
More modestly, electric tricycle developer Myers Motors raised $250,000 from JumpStart Inc for product and IP development.
And stealthy efficient auto company V-Vehicle revealed undisclosed backing from Kleiner Perkins and oil-tycoon-turned-renewables-evangelist T Boone Pickens. Details of the firm's tech are still elusive, but it'll be building a factory in Louisiana. See Greentech Media for more.

Khosla Ventures has quietly invested $12.5m in stealthy Alabama-based cellulosic ethanol company Cello Energy. Again, see Greentech for more.

Energy efficiency software provider Optimum Energy secured $4.5m in a deal led by Columbia Pacific Advisors. The Seattle-based firm says its software can improve the efficiency of heating, ventilation and air conditioning systems by up to 60%.

In an interesting early-stage wind tech deal, Accio Energy raised undisclosed seed funding from the University of Michigan's Frankel Commercialization Fund. Accio says its turbine-free Aerovoltaic tech 'harvests energy by using the wind to move electrically charged particles against a voltage gradient', apparently using MEMS devices to create ionised water droplets which are pushed through pipes by the wind. The firm promises to release more details next year.

Fund news
UK ethical bank Triodos has launched a new venture fund aimed at 'small but growing green businesses in the UK'. The Triodos EIS Green Fund, operating under the government's Enterprise Initiative Scheme, will invest up to £2m in firms operating in renewables, energy efficiency, sustainability and waste recycling.
Triodos is also preparing to raise a second such fund.

Anglo-German cleantech specialist WHEB Ventures has launched a sister company to invest in listed equities. WHEB Asset Management will invest globally, and is targeting a £50m close for its first fund, the IM WHEN Sustainability Fund.

Further reading
Initial findings from a study of cleantech financing show a widening of the 'valley of death' - a dramatic name for the gap between early development-led VC financing, and commercialisation backed by private equity or project finance. In a study of investment data since 2004, New Energy Finance and the US-based Clean Energy Group found that the number of later-stage deals has declined, although average size has increased. The problem has been exacerbated by the ongoing credit crunch and general crisis, they say. For more details, see the NEF press release (pdf 116kb). The full study is due to complete in August.

The synthesis report (pdf 4.2mb) from March's climate change congress urges wider deployment of existing cleantech -
Although there is no “silver bullet” – no single renewable technology that can replace fossil fuels in their totality – a mix of technologies can allow different countries and regions to develop their own renewable energy combinations to meet their own needs. Technologies are already available that, in combination with changes on the demand side - reduced energy usage and improved energy efficiency – give the potential to achieve a 50% greenhouse gas emission reduction by 2050 and, in some regions, to reduce emissions to virtually zero by that time. Reaching such goals, however, requires rapid, substantial build-up of production capacity through concerted investments; a stable policy framework; and research, development and demonstration to facilitate technology learning and reduce production costs.
Some technologies such as basic PV which are not appropriate for power generation in the developed world may still be important for developing countries, the report notes.

Are European renewables developers avoiding thin-film PV? GTM Research's Daniel Englander reckons so, thanks to the credit crunch and general risk aversion.

The Guardian reports on progress on the ambitious Desertec project to link Europe to concentrating solar installations in North Africa. A consortium of 20 German corporates are preparing to back the Euro400bn project.

Optimistic news on potential wind resources from a Harvard research team, as reported in New Scientist:
The team's model suggests that the top 10 carbon dioxide-emitting countries, except possibly Japan, could generate all of their current and projected electricity needs from onshore wind turbines that are already commercially available.
The full paper is available from PNAS.

Finally, remember Steorn, the Irish tech developer which claimed to have come up with a free energy device based on spinning magnets? The 'jury' of scientists and engineers recruited from the famous Economist ad have announced their conclusion -
The unanimous verdict of the Jury is that Steorn's attempts to demonstrate the claim have not shown the production of energy. The jury is therefore ceasing work.
Alas. Cheerily, the company remains unbowed.

Tuesday, 16 June 2009

Clean Sweep 64

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

AlertMe, a Cambridge-based producer of domestic energy monitoring systems, has raised an £8m second round from Good Energies, Index Ventures, SET Venture Partners and VantagePoint Venture Partners. The money goes towards product development and establishing distribution links with retailers and utilities.
AlertMe provides a range of sensors, smart plugs and monitors to track energy use, all based on the Zigbee standard, which it says can cut energy use by a quarter. Energy management systems aimed squarely at consumers seems to be a bit of a niche for the UK - other VC-backed companies include Onzo and GEO.
US 'energy ecosystem' developer Tendril, which concentrates on linking utilities with consumers, meanwhile raised a $30m third round led by VantagePoint. Good Energies also invested, alongside RRE Ventures, Vista Ventures and Appian Ventures.
As has been noted, the two could make for an attractive merger before too long.

VantagePoint is also backing algal biofuel group Solazyme, which announced it had raised $76m funding including a recently closed third VC round at $57m. The round was first reported to have closed at $45m last September, led by Braemar Energy Ventures and Lightspeed Venture Partners.
The new funds go towards commercialising Solazyme's technology, which identifies and engineers microbes to produce fuels and chemicals.

Solar tech firm Semprius closed a $6.4m second round, with In-Q-Tel and GVC Investment Fund joining existing investors ARCH Venture Partners, Applied Ventures, Illinois VENTURES and Intersouth Partners.
The North Carolina firm is targeting the concentrating PV market with its micro-transfer printing technology which promises to cut the costs of module production.

International Battery has raised a $10m second round from existing investors led by Digital Power Capital. In a sign of the times, the funding announcement was hidden under the news that the Pennsylvania firm is asking the Department of Energy for stimulus funding.
International Battery produces a range of heavy-duty rechargeable Li-ion and nickel-cobalt-manganese cells for vehicle, military and utility applications.

San Francisco water purification start-up AquaGenesis has raised an undisclosed first round from local VC Clean Pacific Ventures.
The firm holds rights a continuous electrodeionisation technology, developed at Siemens, which uses ion exchange membrane, resins and electrical potential to purify water. The basic tech is already used in pharmaceutical, semiconductor and power applications, but AquaGenesis is adapting it for the domestic and food service markets.

New rounds for a couple of high intensity discharge lighting companies - the Khosla-backed Topanga Technologies raised $3.45m; while Israel's Metrolight took around $3m from existing investors including Virgin Green Funds, Gemini Israel Funds and Israel Cleantech Ventures.

Further reading
The Guardian reports on a parliamentary motion supporting the mass rollout of solar PV in the UK, based on current proposals for introducing a feed-in tariff for small installations. It's had more support than any other such motion in the current parliament, which is nice. But is PV really the best tech for the UK (or, if you'd rather, is the UK really the best place to put PV modules to work)?

In the wake of Mayor BoJo's electric car proposals, London's inward investment agency has been pitching in San Francisco for electric car expertise and investment. Earth2Tech reports.

News from the cleantech innovation marketplace at this week's World Innovation Summit in Barcelona.

Thursday, 11 June 2009

Top ten VCs

To mark the second anniversary of Clean Ventures, here's an informal ranking of the most active equity investors in UK cleantech companies.

The VCs are primarily ranked by the number of investments from June 2007 to date, as identified from the 'Clean Sweep' deal round-ups on this website. Where two or more investors had equal numbers of deals, I've given preference to large deals and leading investors.

It's inevitably somewhat subjective, partly because there's not always agreement on exactly what counts as cleantech, but I hope it's an interesting and informative exercise.

1. Foresight Group
Investments: Vertal; 2K Manufacturing; Silvigen; Land Energy; AWP Environmental; Lynwood; O-Gen UK.
Foresight has been backing growth companies for 25 years, and has developed an active niche in waste management and biomass. The Kent-based firm has a five-strong investment team focusing on environmental and cleantech opportunities, as well as a growing team dedicated to solar investment across Europe.
Foresight typically invests between £1-5m, and leads larger syndicated rounds. It has a number of funds managed under the government-supported Venture Capital Trust (VCT) regime and the Enterprise Investment Scheme, and recently launched two institutional funds focused on environmental infrastructure and European solar.

2. Carbon Trust Investments
Investments: Acal Energy; 4energy; Whitfield Solar; CamSemi; Green Biologics; Evince Technologies.
The investment wing of the emissions-cutting quango is a very active investor in UK clean energy companies. Recent investments cover fuel cells, energy efficiency, biofuels and solar tech.
Carbon Trust Investments, headed by former BVCA chief executive Peter Linthwaite, has two core funds: the Low Carbon Seed Fund backs early stage companies with £250k-500k equity; and the Clean Energy Fund invests up to £3m in partnership with private sector VCs. Recent partners include Catapult Venture Managers, Oxford Capital Partners, 3i, Scottish Equity Partners and chemicals group Solvay.
Seed investments such as wave energy group ORECon have gone on to raise significant VC rounds.
The Carbon Trust also provides grants and other support for early-stage cleantech companies through a range of innovation programmes.

3. Low Carbon Accelerator
Investments: ProVen Energy; RLtec; Eco-Solids; QuantaSol; HelioDynamics.
AIM-listed Low Carbon Accelerator focuses on early stage and growth opportunities in emissions-cutting companies. Recent UK investments include smart grid, wind turbines, thin-film and concentrating solar, and waste-to-energy. The firm also invests in North America and Europe.
LCA tends to initially invest £350k-2.5m, adding extra equity as growth targets are met. The firm aims to build a significant minority holding in its portfolio companies, typically 15-35%.
The firm was launched on AIM in October 2006 by management firm Low Carbon Investors, raising £44.5m. The Royal Bank of Scotland is a major shareholder.

4. SSE Ventures
Investments: Geothermal International; Onzo; Insource Energy; Vital Energi; Solarcentury.
The corporate venturing arm of utility giant Scottish and Southern Energy, SSE Ventures focuses on growth companies which support its parent's activities. Recent investments include heat pump, CHP, waste-to-energy and solar generation as well as smart grid technology.
SSE invests from £250k-15m, often in partnership with financial sector VCs.

5. Imperial Innovations
Investments: Nexeon; Evince Technology; EVO Electric; Quantasol.
The technology transfer wing of Imperial College London, Imperial Innovations is a leader in taking clean technologies out of the lab and into the market. Its portfolio includes electric motors, batteries and quantum-well photovoltaics, all based on tech developed at Imperial and associated research institutions.
Imperial Innovations typically invests £250,000-5m, often in partnership with other tech VCs, and also provides incubation and support services.

6. Oxford Capital Partners
Investments: Exosect; Microbial Solutions; Green Biologics; Inetec.
Oxford Capital Partners is a classic tech VC with a liking for green chemistry and waste-to-energy. The firm tends to invest £500k-1.5m in syndicated rounds of up to £10m, plus follow-on rounds. As the name suggests, it's based in one of the UK's main science clusters.

7. Environmental Technologies Fund
Investments: Metalysis; Novel Polymer Solutions; Perpetuum.
London-based ETF claims to be Europe's first dedicated cleantech fund backed entirely by financial institutions, closing its first fund at £110m in early 2008. Focusing on clean manufacturing, ETF looks to invest Euro5m-12m over a number of rounds, usually in partnership with other VCs.

8. Sustainable Technology Fund
Investments: Alternative Waste Solutions; Envirotreat; Morgan Everett.
The £20m Sustainable Technology Fund was established by early-stage VC E-Synergy under the government ECF scheme, but has recently been spun out as new fund manager Curzon Park Capital. The fund typically invests £500k-2m in a syndicated round, and has largely concentrated on waste treatment.

9. Finance Wales
Investments: Envirogene; Atraverda; Inetec.
Another state-backed investor, Finance Wales backs growth SMEs in the principality in rounds of up to £1m equity. Recent cleantech investments cover environmental diagnostics, batteries and waste-to-energy tech.

10. Good Energies
Investments: Alertme; Solarcentury.
One of the world's most active cleantech VCs, Good Energies has remained relatively wary of the UK, co-investing in selected opportunities in energy management and solar installation. Globally, the Swiss-based group focuses on solar and wind power, with extensive interests in both technology and generation, and is expanding into energy efficiency.

Friday, 5 June 2009

Clean Sweep 63

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

London-based waste-to-energy firm Advanced Plasma Power has raised $10m from US investor Leveraged Green Energy.
APP was founded in 2005 to commercialise the Gasplasma incinerator process, developed by plasma arc tech group Tetronics, which converts waste into syngas and a vitrified solid. The firm currently has a pilot plant in Swindon and plans international expansion.
LGE, which takes a 10% stake in APP, focuses on investments in CEE and Canada and will help the firm expand in those territories.

Private investor network Hotbed has invested £3.3m in UK windfarm developer Burcote Wind, part of Burcote Environmental Services. The investment should secure the development of up to six onshore sites.

Cleantech stalwart Khosla Ventures and life science specialist Burrill & Co have invested an undisclosed sum in cellulosic biofuel start-up HCL CleanTech.
The Israeli firm is commercialising a proprietary technique of using concentrated hydrochloric acid (hence the name) to hydrolyse biomass, forming fermentable sugars which can be refined into various biofuels and chemicals. The tech is based on a proven conversion process developed in wartime Germany.
The new funding will be used for R&D and building a pilot plant in the US.

Solar tech firm Tigo Energy has raised a $10m second round, led by ICV and including all existing investors.
The Californian firm uses a mix of electronic and software technologies to optimise the output from commercial-scale arrays of PV modules, increasing power by up to 20%.

In a promising move for concentrating solar, infrastructure investor Starwood Energy Group Global announced its backing for what it claims will be the world's largest dispatchable solar plant in Arizona. Utility group Arizona Public Service signed up to buy power from the 290MW plant, which will be built by Lockheed Martin. The plant will include over 3000 parabolic troughs over 1880 acres, and is scheduled for completion in 2013.

Lightweight fuel cell developer UltraCell raised $3.8m from existing investors, led by BASF Venture Capital.
The California firm's XX25 methanol-powered cell is the first to be authorised by the US military for portable devices, and can also be used in remote monitoring and communications equipment.

In another energy storage investment, ultracapacitor developer EnerG2 secured an extra $2.5m equity and options. The Seattle firm, which is targeting the hybrid vehicle and industrial markets, raised $8.5m in October.

LED lighting start-up Digital Lumens has raised a $6.3m first round - details are scarce, but investors are believed to include local VCs Flybridge Capital Partners and Stata Venture Partners.
The Massachusetts firm says it is 'creating lighting systems that deliver 100% of the light for 10% of the energy cost'.

Also in lighting, Israeli ballast manufacturer Metrolight raised a $3m fourth round from Virgin Green Funds, Gemini Israel Funds and Israel Cleantech Ventures. US rival Fulham raised $10m last month.

Stealthy carbon management firm Hara unveiled its service and a $6m round from tech VC giant KPCB. The Silicon Valley firm provides environmental and energy management systems on a software-as-a-service basis (a very friendly business model for cashflow-hungry investors).

Smart grid spin-out OutSmart Power Systems meanwhile raised $2m seed funding from Bainco, angel investor Clean Energy Venture Group and parent Manifold Products. The Massachusetts firm provides tech which uses buildings' electrical wiring as a communications network for smart grid applications.

Fund news
Anglo-French renewables investor Platina Partners has launched a new asset management subsidiary, Engineering Renewables, to manage the development and operations of its investment projects. The new company merges Platina's UK-based portfolio company Your Energy with the project management arm of consultancy BVG Associates. Platina currently has a project portfolio of some 1000MW in the UK and southern Europe.

Low-carbon fund-of-funds manager Osmosis Capital is reportedly raising Euro200m for its first fund. More from Environmental Finance.

Further reading
Plenty to chew on in the Global Trends in Sustainable Energy Investment 2009 Report from New Energy Finance and the UN Environment Programme.
The report surveys the sources and destinations of the $155bn invested in 2008. Wind took the largest slice ($51.8bn) , followed by solar ($33.5bn) and biomass ($16.9bn).
For the first time, investment in new power generaton from renewable sources ($140bn) topped that for fossil-fuel sources ($110bn). However, renewables still account for only 6.2% of total global capacity.
Key points re VC and private equity:
• Private equity, to some extent, took up the slack from the public markets, where sharp falls in share prices made it hard for companies to raise fresh capital.
• Venture capital and private equity funds invested $19.3 billion in renewable energy and energy efficiency companies in 2008, an increase of 43% compared with 2007.
• 2008 was a volatile year during which investment rose to an all-time high and then, as the year drew to a close, entered into a steep decline that is lasting well into 2009.
Also from NEF, a collection of presentations and research from March's NEF Summit (pdf 1.7mb).

Stephen Tindale of the rather useful Climate Answers offers some suggestions on how the UK could meet the EU renewables 2020 target. Some interesting points on regulatory risk and ROCs vs FIT.

The latest Economist Technology Quarterly has a couple of solid pieces on the state of the art in solar thermal and smart grid tech.

A new US lobby group, Clean Economy Network, aims 'to bring the voices of clean business leaders to policymakers'. Can or should there be a UK/European equivalent?