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EcoFactor: Residential Energy Efficiency without the Dashboard

David Cheng
by | April 20th 2011
Posted in Energy Efficiency, Pitch of the Week, Venture Capital

Some pundits see energy efficiency as a killer application for cleantech.  With the recent $50 million equity raises for OPOWER (see Company Insight Report, subscription required) and C3, it would be hard to disagree.  But the venture capitalist in me says that the common form of energy efficiency isn’t an application; it’s a feature of a product.  Whether it’s a Prius or a Macbook, consumers buy a product for its applications (Prius: transportation, Macbook: laptop computing), with efficiency as a desired feature but a feature nonetheless.

Unfortunately for grid operators and purveyors of McKinsey charts, energy efficiency for industrial, commercial and residential premises isn’t likely to buck the trend.  People buy a thermostat or HVAC system for its heating and cooling applications, not for its efficiency accolades.  Particularly in the residential market, consumers are unlikely to spend time looking at an energy management dashboard when they have Facebook, baseball season and Glee as distractions.  This is where California-based EcoFactor comes in.  EcoFactor claims up to 30 percent of a residential home’s HVAC bill can be reduced without the consumer changing behavior or looking at a digital dashboard or billing insert.…

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AMEE: Shovels for the Carbon Gold Miners

David Cheng
by | April 18th 2011
Posted in Cleantech Investment Insight, Company Insight, Energy Efficiency

There isn’t a global price on carbon today.   Part of the reason why the world can’t get its head around carbon pricing is that there are too many standards and methodologies.  And as a former i-banker, I know that confusion and complexity creates opportunities for rent extraction and margin expansion.  UK-based AMEE is trying to fix this problem.  As a neutral third-party, AMEE has aggregated the world’s carbon standards and aims to be the de facto resource for all services and technologies carbon-related.  It provides a platform for service providers (like investment banks and accounting firms) and software providers (like ERP vendors) to build applications off its web-services API or to leverage its deep library of carbon methodologies and definitions.  In other words, AMEE aims to sell shovels to the gold miners.  And if carbon management is a gold rush, the most prolific shovel maker is in an attractive position.…

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Will GreenPocket be the OPower of Europe? Come to Amsterdam to find out.

Greg Neichin
by | April 14th 2011
Posted in Cleantech Investment Insight, Companies, Company Insight, Europe and Israel, Pitch of the Week, Smart Grid

Earlier this month I published an insight profile on OPower (link requires subscription), a company that has established an impressive, early lead in the market for helping utilities communicate energy usage data to consumers.  In that piece, I tried to explain the nature of the company’s success:

“While most software and web services vendors in the home energy management space are touting pilots with hundreds, or at best thousands of homes, OPower  is the only SaaS (Software-as-a-Service) solution that is credibly touching millions of consumers.  The company has achieved this impressive momentum by following a time tested business adage – KISS (Keep It Simple Stupid).  While other vendors were pursuing elaborate hardware and software solutions, OPower maintained a sharp focus on the customer billing experience – both offline and online.  In doing so, it has carved out a powerful position as the market leading solution for customer engagement.”

This morning, Jesse Berst at Smart Grid News had a similar headline that says it all “How OPower is Crushing Its Competition”.

OPower, based out of Arlington, Virginia, has primarily asserted its dominance in the United States where it has racked up customer wins at the country’s largest utilities …

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Weekly Investment Highlights

Hans Chen
by | April 14th 2011
Posted in Cleantech Investment Insight

Each week our research team tracks cleantech transactions across the globe. This week we recorded 14 VC/PE deals, one fund announcements, 11 M&As and three IPO-related announcements. Below are some of the highlights. Cleantech Group subscribers can see the full roundup of all the deals here.

VC, private company and corporate investments

over $173m of venture fund was raised by 12 cleantech companies, the two largest deals were:

  • MaxWest Environmental Systems, a Florida-based developer of waste-to-energy gasification facilities, received a $32.5m third round funding from Invesco. The proceeds will be used to develop and implement the company’s commercial process to convert wastewater treatment residuals into green energy, as well as to bolster the Company’s successful sales and marketing efforts.
  • UK-based wind power project developer Wind Energy Direct (WED) raised €20m (~$28.9m) in an equity funding round from ESB Novus Modus. The funding will be used to support the development of projects across the UK and Ireland. WED plans to spend €100m (~$144.7m) on projects over the next three years.

Mergers and acquisitions

11 cleantech M&A transactions were tracked this week. Highlights included:

  • French nuclear power operator EDF Energy launched a €1.5b (~$2.2b) bid to take full control of its

    • …

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Lighting continues its hot streak

Josh Gould
by | April 13th 2011
Posted in Cleantech Investment Insight, Sector Insights, Venture Capital
Tags: ,

In a recent blog after our San Francisco forum, I discussed how cleantech needs to move forward with more action (verbs) and less idle chatter.

With that in mind, I’ll keep this post short and point out what is becoming increasingly obvious: lighting is hot.  Just a few quick anecdotes to support this point:

  • It’s a huge, international market (easily in the $000′s of billions – see our recent lighting report for more about our estimates of market size)
  • It has VCs interested.  In 2010, lighting companies raised $350M in venture funding, up from $230M in 2009 (yes, you read that correctly, it was a $120M or 52% annual increase)
  • The hot streak continues in 2011 with companies like Digital Lumens recently raising another fundraising round (note: we rececntly profiled the company as part of our subscriber-only research)

Since last year we here at Cleantech Group have been saying that lighting is a big, big deal in cleantech.  But it’s nice to see that the rest of the world is taking notice.  Stay tuned to our research and blog as we continue to cover this important cleantech sector.…

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Water: Week in Review

Mia Javier
by | April 13th 2011
Posted in Cleantech Investment Insight
Tags: , , , , , , , , ,

Our research team regularly tracks key water sector news.  Below is this week’s highlights. Do you think we missed anything? Let us know!

Deals:

  • Talquin Electric Cooperative Implements Sensus AMI and Smart Metering Technologies for Electric and Water Service Talquin Electric Cooperative, Florida’s 5th largest distribution electrical cooperative, is implementing Sensus technologies for its advanced metering infrastructure (AMI) and smart metering program that will serve all 54,000 residential, commercial and industrial members in its 2,600 square mile territory.
 http://www.waterefficiency.net/the-latest/florida-coop-sensus.aspx
  • GE Supplying Water Recycling Technology to First US Power Plant to Be Built With Stricter Federal, State Emissions Limits GE today announced its zero liquid discharge (ZLD) wastewater recycling technology will be installed at the Russell City Energy Center (RCEC), a new 600-megawatt (MW) natural gas and steam combined-cycle power plant being built in Alameda County, Calif. “GE’s ZLD system is an example of how technology can play a vital role in helping utilities and governments reduce the impacts of energy production on the world’s vital fresh water supplies,” said Heiner Markhoff, president and CEO—water and process technologies for GE Power & Water. http://www.waterefficiency.net/the-latest/ge-recycling-emissions.aspx

  • GE Technology Purifies Water at One of World’s Largest Coal Power Plants. South Africa’s leading power provider,

    • …

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Car sharing – an opportunity for Auto OEMs in a tattered market?

Stephen Marcus
by | April 13th 2011
Posted in Transportation
Tags: , , , , , , , ,

The dire financial situation of the auto industry is already well chronicled. Global car sales have fallen 6.3% from their peak of 71.4 million in 2007 down to 66.9 million in 2010, a rate of decline not seen for decades. Digging deeper into these numbers reveals a more dramatic story: sales have plummeted in America almost 40% below their highest point to levels last seen in the early 1970s, necessitating bastions of the American auto industry such as GM and Chrysler to have their balance sheets shored up by large government handouts.

Global Car Sales

Source: www.economist.com

In tandem with the recession-induced dearth of car sales, the total cost of car ownership is showing the opposite trend. According to the 2011 AAA ‘Your Driving Costs’ study, the cost of operating a sedan in the U.S. increased by 3.4% to $8,776 per year based upon 15,000 miles of annual driving. One of the biggest culprits was gas prices which, despite increases in fuel economy, had increased 8.6% to 12.34 cents per mile on average for sedans.

So far, so simple.

But adding further fuel to the fire is car sharing. The results from a North American shared-use vehicle survey …

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RelayRides: Could it Zip past Zipcar?

Stephen Marcus
by | April 12th 2011
Posted in Company Insight, Transportation
Tags: ,

All eyes are on Zipcar this week to see how it fares in its scheduled IPO which, at the mid-point of its proposed range, would command a market value of $639 million and be the first car-sharing company globally to go public.

However, less-known but already emerging, is a “second generation” of neighbor-to-neighbor car-sharing companies. The leader of this up-and-coming business model is San Francisco-based RelayRides. (For a more detailed look at RelayRides, take a look at the company insight profile (subscription required)). In contrast to Zipcar which owns its own 8,000-strong fleet of vehicles, RelayRides’ fleet is comprised of privately-owned vehicles which people are willing to loan out in exchange for hourly and daily pay-as-you-go fees from drivers who want access to cars.

By avoiding the overhead cost of buying and maintaining its own fleet, the company says that it will be able to offer car-sharing at hourly rates that are $1 to $2 less than competitors like Zipcar. According to Zipcar’s S-1 filing, c.70% of its costs and expenses are associated with its fleet operation making its business massively asset intensive. Further, with RelayRides, the hourly rates may fall as more car owners join the scheme …

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Coulomb Technologies: The Franchiser of EV Charging

David Cheng
by | April 11th 2011
Posted in Cleantech Investment Insight, Company Insight, Transportation

It seems with gas prices continuing their upward trajectory, it would be apropos to profile another electric vehicle charging equipment (EVSE) and service provider company.  This week, my focus is on Coulomb Technologies.  Coulomb stands separate from their EVSE peers distinctly in their business model as a franchiser-of-sorts for EV charging.  Coulomb sells their charging stations and service through value-added resellers in North America, Europe and Australia.  Ultimately, Coulomb doesn’t view itself as a hardware provider but rather a business software/service provider to utilities, municipalities, retailers and corporations.  This model seems to be working, as the company has found success in the US through its ChargePoint America program and in Europe through its partner, 365 Energy.

In a new Company Insight Profile on Coulomb Technologies, I touch on these deployments as well as some of the various features that differentiate Coulomb’s offerings to its competitors.  I also cover how I view this growing and dynamic EVSE market, particularly in the context of the EV deployments coming out in 2011.

To find out more, take a look at the Company Insight profile (subscription required).

More Cleantech Group Research (subscription required):

ECOtality Company Insight
ZipCar Company Insight
CODA Automotive Company Insight

 …

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How do you say Zipcar in French? – Maybe something to think about after 13 April

Stephen Marcus
by | April 8th 2011
Posted in Company Insight, IPO, Transportation

By now, we all know that Zipcar has priced its IPO at $14-$16 dollars per share and is planning a NASDAQ IPO for 13 April. We also know that despite bringing in over $180 million in revenue, the company reported a $14 million loss in 2010. So why, in my opinion, is Zipcar destined for success? What makes Zipcar different from the numerous other car sharing companies using similar, if not identical business models?

I decided to turn over a few stones to investigate. To find out more, take a look at the Company Insight Profile (subscription required).

Sales + Scales – On a company-wide level, Zipcar’s comprehensive geographical reach is another differentiator vis-à-vis smaller competitors because its technology platform and operational backend can be spread over a wider consumer base, and it has consequently refined its business operation with over 10 years of experience.

A prime example can be seen when looking under the hood of Zipcar’s acquisition of UK-based Streetcar. In 2010, Zipcar’s established markets brought in an average $28 million of revenue each and were operating at above a 20% margin, much higher than Streetcar’s marginal loss in London despite the market being of equivalent size.

Revenue …

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