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This Deal Matters: Cool Planet Energy Systems Closes Series D Funding; Corporates Bet on Advanced Biofuel and Rising Activities in Asia

Leo Zhang

cool planetCool Planet Energy Systems, the Colorado-based developer of advanced drop-in fuels and biochar, announced a $50.7 million investment and the closing of the company’s $100 million Series D growth equity round. Cool Planet’s latest investors include Concord Energy Holdings, a Singapore-based crude oil trading company, which led the round with existing investor North Bridge Venture Partners. Other existing investors include BP Ventures, ConocoPhillips, Energy Technology Ventures, Exelon Capital Partners, General Electric, Google Ventures, NRG Energy, and Shea Ventures. The new investment, along with Cool Planet’s strategic corporate investors, will help to expedite the company’s 10 million gallon per year biofuel facility in Louisiana. The timing of this deal is significant in that it demonstrates corporate interests in bio-based drop-in fuels, especially given the ongoing commercialization struggle of another high-profile drop-in fuel company, KiOR, which private investor Vinod Khosla has recently committed an additional $25 million from his personal trust to continue supporting the company.

This deal also matters as it is the second deal of back-to-back investments into biofuel companies, following a $60 million growth equity round raised by LanzaTech just a week ago. Notably, we have observed increasing …

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To Do China Right, Enjoy the Food: 12 Gems For Growing Your Business in China

Josh Seidenfeld

Last Friday, Cleantech Group, Silicon Valley Bank, and Wilson Sonsini Goodrich & Rosati convened an intimate group including investors (Dow Venture Capital, Keytone Ventures, Khosla Ventures, The Westly Group), corporate innovation leaders (ABB, Applied Materials, Siemens), and startups (Efficiency Exchange, Gridium, NexSteppe, Scoot Networks) for a Power Breakfast focused on strategies for working in China. A panel of investors, bankers, attorneys, and startup CEOs with deep experience working in China led the conversation, moderated by Cleantech Group’s CEO, Sheeraz Haji (see a couple interesting slides from Sheeraz’ presentation at the end of the post.)

We promised not to attribute quotes so participants would feel more comfortable speaking their minds, but here are a dozen highlights from the experts:

  1. Enjoy the food. Personal connections drive business in China. One panelist mused, “Once you start enjoying food with people you really start to get to know one another.”
  2. Wear the mandarin hat. One seasoned investor recalled how he was advised to make clear to Chinese counterparts “what’s in it for them.” But, he added, the euphemism “wear the mandarin hat” sounds better. The need to align partnerships

Energy innovation opens doors for the world’s 1.3B “energy-poor”

Josh Seidenfeld

InterSolar is on this week in San Francisco. While it’s been a rough year for the upstream folks, and the tradeshow floor may have a New-Year’s-Day-hangover feel about it (notable exception: the focus on the burgeoning energy storage field), some bright spots emerge. As I nurse my own hangover from last night’s Solar Battle of the Bands, I’m reflecting on a terrific side-event that featured some of the world’s most exciting energy innovators.

The Bay Area Energy Access Working Group (a name only an engineer could love) yesterday convened entrepreneurs blazing pathways out of energy poverty. The group, hosted by Google.org at Google’s San Francisco offices, shared new approaches to delivering energy services to some of the 1.3 billion energy-poor people across the globe. New financial tools, new communication technologies, and new business models drive energy innovation in the developing world just as they do in the rich world. The event’s three panels addressed these drivers.

Finance innovation might be the most important current development. Many of the technologies used to deliver life-altering energy services to off-grid, rural communities have long been established. Solar lanterns come to mind. Now, though, we require the money to deploy these technologies at scale. …

A Thirsty Tourist in Thailand

artipatel

I spent Thanksgiving week traveling through Thailand.  It was my first trip there, and hopefully not my last – the country is amazing!  I love the people, the culture, the food, the views….and the free bottled water?  Yes, you read that correctly – free bottled water.  In Thailand, it is standard to receive 2-3 complimentary bottles of water in your hotel room, despite assurance from the government that the tap water is safe to drink.  As most tourists do, I erred on the side of “better safe than sorry”, and took the bottled water.  Though I must admit, I was somewhat ashamed to do so.

Isn’t the tap water in Thailand subject to WHO guidelines for drinking water quality, which would ensure that I am protected from harmful contaminants?  Doesn’t the organization pride itself on “producing international norms on water quality and human health in the form of guidelines that are used as the basis for regulation and standard setting, in developing and developed countries world-wide”?  Indeed it does, but I overlooked the difference between a guideline and a requirement – an extremely important distinction.  Guidelines are mere recommendations or targets that help ensure the quality of …

The Quarter That Was: Outsourced Reflection

Greg Neichin

Given the pace at which the business world moves these days, there is often not enough time for thoughtful reflection.  It can be all too easy to get lost in last week’s meetings and next week’s deadlines and to completely miss the forest for the trees.  With the amount of information that we all try to consume on a daily basis, it is easy to mistake a headline for a trend, hyperbole for fact.

Luckily, that’s where we come in.  Consider us your “Outsourced Reflection”.  Every quarter, for the past 7 years, we have published a comprehensive quarterly manifesto – Cleantech Group’s Quarterly Investment Monitor.  Frankly, I think that this exercise is more important than ever.  As we wrote in opening this edition:

2012 has started on a similar note [to the end of 2011] with a rising number of cleantech companies funded despite a continuing public and media fascination with the sector’s high profile failures. In responding to erroneous press accounts of his own death, noted American author Mark Twain once wrote, “the reports of my death are greatly exaggerated.” The same could be said of cleantech.

If all you read in the last three months was news of …

As Goes LanzaTech, so Goes Cleantech

Greg Neichin

If you are in the cleantech sector and had not previously heard about Lanzatech, you likely have now.  The company raised a big, $55.8M round last week that has been widely applauded and covered.  Students of the company had seen this coming for awhile.  Lanzatech was the highest ranking company in the Asia Pacific region in our Cleantech 100 survey earning it “APAC Company of the Year” at our gala banquet last year.  It was featured as part of GTM’s Trendspotting post on the Top 12 Greentech Startups to Watch in 2012.   We’ve made Lanzatech our featured “Company of the Week” in i3 this week, but it may just turn out to be cleantech’s company of the year (and its only January!).  Here are the top reasons that I think Lanzatech exemplifies a number of key themes happening in cleantech:

1.) Cross-Border Financings – I have previously written about Chinese and Korean investors taking large stakes in Western cleantech companies.  Now we can add the Malaysians to that list.  The round was led by the Malaysian Life Sciences Capital Fund and included participation from Malaysian state oil company, Petronas.  With the US venture community still experiencing …

Top 5 Cleantech Predictions For 2012: The Expanded International Version

Greg Neichin

It’s that time of the year when pundits and prognosticators begin to opine about what will happen in 2012.   Frankly, I don’t like this game.  In mid-2001, I worked for a technology “futurist” firm and wrote a piece predicting that CD-R/W music players would continue to dominate in the year ahead.  That was a couple months before the ipod came on the market and made me look like a fool.  Not that I mind looking like a fool, but I think I’ve shied away from these declarations ever since.

However, I was inspired this week by Rob Day (@cleantechvc) to throw my hat back into the ring.  Why? Because Rob actually went back and wrote a post critiquing the predictions he made from the previous year.  I found this remarkable precisely because most analysts write these odes with zero accountability.  As an investor, Rob actually has to bet on his predictions, so I enjoyed his self-critique.  I promise to do the same – someone hold me to it!

So without further adieu, here are my top 5, slightly irreverent, predictions for cleantech internationally in the year ahead. Why international? Because I’ve spent most of the last 6 …

Double-sided Story: Wind Power IPOs in China

Hans Chen

On June 10th, 2011, Huaneng Renewable Energy Holding, the renewable energy (predominately wind energy) subsidiary of state-owned power company China Huaneng Group, raised HK$6.23 billion (~$800 million) through its second attempt at an IPO on Hong Kong Stock Exchange.

It would turn out to be the largest cleantech IPO globally in 2Q 2011. After Sinovel Wind Group’s $1.4 billion IPO in 1Q 2011, it’s likely that we will get used to at least one gigantic IPO in China every quarter these days.

It’s already the third IPO on the China/Hong Kong stock markets for a wind energy subsidiary of a state-owned power company. Of the five major Chinese state-owned power companies, Guodian, Datang and Huaneng have already had their wind energy subsidiaries making public market debuts. The remaining two, Huadian and China Power Investment, both already established renewable energy subsidiaries.

The story here seems to be: Wind energy in China was boosted by lucrative subsidies. Rich power companies invested billions of RMB to establish renewable business. These businesses, aided by huge financial support from parent companies, are able to develop rapidly and go public in a relatively short amount of time, bringing even more capital.

Stock …

The case against EVs in China

Stephen Marcus

As an analyst following the day to day happenings in green transportation, I often feel that the industry blindly accepts that the majority of the future economic opportunity for EVs is in China. Many articles often rehash the usual drivers of near double digit GDP growth, powerful government edicts, and poor urban air quality to support their statements. It certainly makes a strong case.

However, whilst the potential market for EVs in China is obviously HUGE, it is important to dig deeper in order to specifically assess the suitability of EVs as a solution to Chinese consumers rather than get overly excited every time the “C-word” is dropped into the equation. What will make Chinese buy electric vehicles over traditional ICE vehicles? Simply saying the economy is growing fast and air quality is poor, in my book, is not enough.

When taken from this standpoint, the opportunity for EVs in China looks less rosy for at least three reasons:

  • Price Sensitive Consumers: It is important to recognize that EVs will, at least for a number of years, command a significant ($10-15k) price premium over traditional ICE vehicles. And even though China’s economy is growing fast, the lion’s share of car

Three Gorges Dam: China’s Dilemma

Hans Chen

Think the Chinese Communist Party never admits a mistake? Think again.

The rare occurrence happened earlier this week, when China’s State Council, the country’s Cabinet, said in an official statement that while the Three Gorges Dam “provides huge comprehensive benefits, urgent problems must be resolved regarding the smooth relocation of residents, ecological protection and geological disaster prevention”. This was the first ever official acknowledgement of the dam’s negative impact.

Some background information: Three Gorges Dam is the world’s largest capacity hydroelectric dam (total generating capacity of 18,200 MW) located in the mid stream of Yangtze River, the longest river in Asia. Also, it is probably the most controversial water project in the history of mankind, as political, humanitarian and environmental issues were brought up constantly by the opposition.

One would argue that such gigantic hydro power project is not really “clean energy” because the construction itself often has a negative impact on the environment, not to mention the CO2 emission just to produce all the concrete needed. That is a valid argument, of course. But when a country with 1.3 billion people generates 75% of its electricity via coal-fired thermal power, hydroelectric power looks pretty clean.

Many people …