CalCEF is an oddity in the VC world. It is a non-profit venture fund hatched with the help of a $30 million PG&E bankruptcy settlement in 2004. CalCEF invests in emerging clean energy technology companies that benefit the PG&E service region.  

CalCEF has tweaked its model and has helped establish a for-profit Angel fund, a separate entity from its non-profit fund. CalCEF provided the initial $1 million LP investment and the Angel Fund has since raised additional investment with other individual and institutional LPs, including CalPERS. The firm has added staff members Susan Preston and Matt Lecar to better focus on angel investments through the CalCEF Clean Energy Angel Fund and established the CalCEF Angel Network -- a new angel network that already has 150 companies that have submitted business plans and applications to the network.

"We want to do for the cleantech angel investor community what the Cleantech Open has done for entrepreneurs -- organize the resources and provide the infrastructure to promote smarter investment," said Matt Lecar.

CalCEF’s model is to provide early-stage funding, and help startups in the critical “first MW� gap.   “The market still needs seed-level financing.  There are not enough person-hours for VCs to make $500,000-size investments in the energy field.  CalCEF helps serve that gap in the very early-stage investment markets,� said Dan Adler, the President of CalCEF. The CalCEF portfolio includes Fat Spaniel, CoalTek, Solarcentury, Tesla Motors, and many others.)

CalCEF Clean Energy Angel Fund had a get together last evening at the law offices of Wilson Sonsini Goodrich and Rosati in Palo Alto, Calif.

California is Different

Hal LaFlash of renewable-friendly utility Pacific Gas & Electric spoke at the event on the future of energy in California.  “California is different than the rest of the U.S.,� he said. Some other tidbits: 

• California has the lowest per capita energy usage in the U.S.
• California has the most aggressive Renewable Portfolio Standard -- 20 percent by 2010 and 33 percent by 2020.
• PG&E has nine large solar projects ranging from 2MW (GreenVolts) to greater than 500MW (Brightsource, Ausra, Optisolar, et al.). 
• PG&E has connected more than 27,000 customer solar installations (more than 280MW). More than half of new solar installations in the US were interconnected with PG&E.

Startups on Parade

Each month the angel network showcases a pair of early stage startups looking for funding.  The first tonight was TrendPoint.  TrendPoint is focused on energy and carbon metrics in the data center.  “Most data center operations look like giant industrial installations even though they are in office buildings,� said CalCEF's Matt Lecar.

Trendpoint’s  CEO, Bob Hunter claimed that, “Data center electricity usage is growing more than 15 percent annually."  The firm establishes yardsticks for the data center and tries to help corporate managers attack their energy problems.  Its hardware and software system allows data center managers to measure and manage their usage with "utility-grade energy and carbon data" and a focus on circuit management in the panel.  Their customers include VMware, Facebook, and EDS-UK.  “Nobody racks a server at Facebook without looking at our system,� said Hunter.  Trendpoint has $700,000 in sales and is looking for $2 million in funding.

Quality startups (some with revenue!) vetted and groomed by investors.  CalCEF is looking for new members to join its angel network.

The solar power industry may be in a state of oversupply, but that doesn't mean demand for polysilicon solar panels has dropped off. China's ET Solar Group Corp., a maker of silicon ingots, wafers and solar panels, proved the point Tuesday when it announced a deal to sell 13 megawatts of panels to German solar integrator and distributor USE between this month and November. How much USE is paying ET wasn't disclosed by the companies. But given comments from the world's largest makers of polysilicon photovoltaic solar panels in recent months, it's likely the price has fallen since ET first sold panels to USE in the second half of last year. Suntech Power Holdings (NYSE: STP), which earlier this month said it had grown to be able to manufacture 1 gigawatt of solar panels per year, has cut its sales forecast for last year and predicts a 25 percent to 30 percent drop in the prices it will be able to command in the coming year. An oversupply of polysilicon is to blame, CEO Zhengrong Shi said — a warning that has been matched by other solar companies and analysts. While demand for polysilicon to make solar panels should grow 34 percent next year, supply will probably double, research firm iSupply predicted in November. That could drive spot market prices for polysilicon to $200 per kilogram next year, down from highs of $500 per kilogram in 2008.  Germany's Q-Cells, which expects 2009 production to reach 800 megawatts to 1 gigawatt, also slashed its 2009 production and sales forecasts last month, citing customers' decisions to delay deliveries of already-booked orders. The weakening economy was to blame, the company said. 

Norwegian electric carmaker Think is getting about 40 million crowns ($5.7 million) to try to save itself from bankruptcy.

The loan came from several private investors, including Ener1 Group. Ener1 Group is a big shareholder of Ener1 Inc., which has a deal to supply lithium-ion batteries to Think.

The emergency funding falls short of the 100 million to 200 million crowns ($14 million to $28 million) that Think said it needs to survive. The carmaker has asked for the government help, but hasn’t received a positive response.

The company temporary halted production of its two-seat, all-electric car last month when it ran out of money. Like fellow startup carmaker Tesla Motors, Think has found it difficult to raise capital amid the global financial market meltdown.

The new loan will help Think stay afloat for just a little while until it can raise more money.

"The financing will allow Think to focus its efforts toward the next stages of the restructuring process," Think said in a statement.

It was only back in November when the company announced it had started to sell its first model, the Think City. The Think City isn’t cheap -- it will set you back 200,000 crowns ($28,690), and that doesn’t include the cost of the battery pack. Car owners can lease the batteries for 1,275 Crowns ($183) per month (see Think’s Electric Car Is Here, But Bring Your Wallet).

The compact car can go 180 kilometers (112 miles) on a single charge and enjoys a top speed of 100 kilometers (62.5 miles) per hour.

Before the company was beset by financial woes, it was peddling the Think City only in Norway, but it was planning to start selling the electric auto in Denmark starting in the first quarter of 2009.

Steve Chu, the likely next Secretary of Energy for the U.S., told a Senate committee that the country needed to invest in clean coal as well as carbon capture. Chu has always been an outspoken opponent of coal. However, he's also tempered that with the fact that it is the world's most abundant form of fossil fuel, that it is cheap, and that some of the world's largest deposits are in China and India. He said he is "hopeful and optimistic" that clean coal can be developed, according to a post in the Wall Street Journal's Environmental Capital blog. “If confirmed, I will work very hard to extensively develop� clean-coal technology, he said, according to the blog. “Even if we turn off coal, China and India will not.� Is it a reversal to accommodate the incoming President, who hails from a coal state? While some are trying to claim it is, it seems to be consistent with previous statements from Chu. He's a relevant portion from an 2006 interview I did with Chu. He's not wild about coal, but says carbon capture and clean coal may have to be pursued until the solar industry becomes widespread. How about nuclear? We've had it for a long time, but is it politically just too much of a lightning rod? Chu: I hope that coal becomes more of the lightning rod. It should be. If you think about coal, it's really scary because it's our most abundant natural energy resource. And the countries that have the most are the most energy-consuming countries, namely us, China and then Russia in that order. It has sulfur dioxide and nitrous oxide and mercury pollution problems. In China, it's killing their people, its killing their infrastructure. And people die from mining it, so it's not a good energy source. We don't yet have proven technology to turn it into a clean burning fuel and capture the carbon dioxide and sequester it. We need to do a lot of research on that to make it economically feasible to do all that. Is there much hope there? I've seen a few venture capital firms invest in clean-coal ideas, and a couple of companies, like BP, have sequestration projects going on. Chu: Boy, it might have to be at least in the interim until we can get photovoltaic cells down by an order of magnitude or until we get the biomass up and running. We are going to have to have to do something in the next 50 years. The world will increasingly turn to coal and possibly nuclear. Even if you can sequester only for a few hundred years, it will buy time.

UPDATED: It turns out, Tesla isn't building the entire powertrain for Daimler, but only the lithium-ion battery pack and chargers for Daimler's Smart cars.

Tesla's spokeswoman told me this morning that "we have a deal to build powertrains for Daimler," but she has since called back to say that Tesla is not building the entire powertrain but only the battery pack and charger.

The deal is to build the components for 1,000 all-electric Smart cars within two years, said Tesla spokeswoman Rachel Konrad. She declined to talk about the value of this deal.

The announcement, made by Tesla CEO Elon Musk at the Detroit auto show, confirmed speculations that have swirled over the past year that the startup electric carmaker could ink a deal with Daimler to supply auto parts (see Green Light post). Musk went to Detroit to tout the company's powertrain technology and look for new customers, Konrad said.

Tesla delivered the first prototype battery to Daimler a year ago, but the commercial version is still under development, Konrad said. Tesla plans to build the batteries in California. 

Partnering with a large car company is good news for the San Carlos, Calif.-based Tesla, which has run into money trouble. It wasn’t able to raise the money needed to build a factory for its second car, the Model S, and had to get an emergency cash infusion from its existing investors while waiting for the U.S. Department of Energy to approve loan guarantees. Tesla plans to introduce the Model S in 2011 instead of 2010.

Could Tesla also be working with Daimler to build its third model? Musk has talked about partnering with another company to develop a cheaper car that would cost less than $30,000 (see Tesla Coughs Up Sedan Price, Details On Economy Car).

Tesla is currently shipping its first model, the $109,000 Roadster. It has delivered more than 150 Roadsters to customers so far. More than 1,000 wealthy folks are on the waiting list.

The company also announced a sports car version of the Roadster on Monday (see Tesla Spiffs Up Roadster; Chrysler Touts All-Electric Sports Car).