Following the Money in Smart Grid

Camille Ricketts of Venture Beat moderated a panel on VC investment in smart grid at the Greenbeat event this morning.

Here are a few notable observations and quotes from the investors on the panel.

Peter Wagner of Accel Partners:

• He's very interested in the issues in the charging and control of EVs.
• He encourages entrepreneurs to find customers who are not the utility – go direct to a consumer.
• Wagner is looking for the company that looks like Opower meets Playfish – bringing social networking plus energy monitoring direct to the consumer
• "Wouldn't be surprised to see Cisco acquire Silver Spring Networks – although Cisco is probably tired of being extorted in the M&A market." (See Tandberg.)
• The negative with government smart grid funding is the risk of "false positives" – chasing pools of dollars that seem to exist but are really a mirage.

Don Wood of DFJ on greentech exit action in China:

• Wind turbine blade manufacturer "Tang Energy will go public" and I think you will see an EV company go public in 2010."

Microsoft Turns Sacramento Onto Hohm

Microsoft turned on the data feeds to its Hohm home energy monitoring platform at a third utility on Thursday – the Sacramento Municipal Utility District.

SMUD has 1.4 million customers, and all will now be able to see their monthly power bills through the Hohm web-based platform, Microsoft planned to announce Thursday morning at the utility's Sacramento, Calif. headquarters.

Microsoft has already enabled similar functionality at two other utilities – Xcel Energy, with 3.4 million customers, and Seattle City Light, with about one million customers (see Green Light post).

The monthly data – which doesn't require a smart meter to be delivered to customers – can be linked with information customers can input themselves about their household energy use. Hohm merges it all to give homeowners tips to help save energy (see Microsoft Launches Home Energy Site, Sees Devices, Demand Response in Future).

It's a model a bit more like energy efficiency tip websites, though Microsoft would like to see more frequent smart meter data incorporated into the system as it becomes available.

That's the route most other home energy management platforms are taking.

That includes Google, which has signed up about 10 utilities, smart meter maker Itron, and home energy gear makers The Energy Detective and AlertMe to provide data to its web-based PowerMeter platform (See Green Light post and Google, British Gas Help AlertMe Launch Home Energy Control).

Google and Microsoft have other differences in how they approach the home energy management market (see Green Light post for a list).

Of course, there are also dozens of startups such as Tendril, Control4, OpenPeak, EnergyHub, Onzo, and many others attacking the home energy management space. Two notable ones, Greenbox and Lixar, have been acquired by richly funded smart grid startups Silver Spring Networks and GridPoint, respectively, and meter data management software maker eMeter has launched its own platform as well (see Green Light post, Silver Spring Swallows Greenbox and stories here, here, here and here).

News Corp. Picks Hara for Carbon Accounting

Hara, the carbon and energy accounting software that's landed such clients as Coca-Cola and the cities of Palo Alto and San Jose, has gained another big client – Rupert Murdoch's News Corp.

Hara will provide its Environmental and Energy Management platform to help the media giant measure and analyze energy and emissions information from hundreds of facilities around the world, the two announced Thursday.

Chalk it up as another big win for the two year old, Menlo Park, Calif.-based startup, which came out of stealth mode in May with news that it had raised $6 million from VC powerhouse Kleiner Perkins, Caufield & Byers (see Energy Management Startup Hara Lands Coke as Client, $6M From Kleiner).

Since then, Hara has added $14 million to its war chest with a Series B financing including Kleiner and new investors JAFCO Ventures and Nth Power (see Hara Grabs $14M, Seeks International Markets).

Hara is one of the best-funded startups competing in the nascent, but primed-for-growth business of carbon and energy accounting software. Others include CarbonFlow, Planet Metrics, Carbonetworks and CSRWare (see Carbon Accounting: It's All About Appearances).

Analysts say these startups will need deep pockets to compete against enterprise software giants such as SAP and CA that are entering the field – some by purchasing startups of their own – as well as others with a long history of helping companies manage energy and environmental data (see Giants vs. Startups: SAP Stakes Carbon Accounting Claim).

Hara and News Corp. did not disclose financial terms of the deal announced Thursday. But News Corp. has set a goal of making all its business units carbon neutral by next year – down from 641,150 tons of carbon dioxide equivalents it emitted in the 52 countries in which it operated in 2006 – so it looks like Hara will have its work cut out for it.  

Video: Cleaning the Ocean With Carbon

SAN FRANCISCO -- Here's something you don't expect to see.

A-Z Comp, a startup from Russia, wants to use graphene, a type of carbon molecule, to clean up oil spills. When oil spills into the ocean, it sticks together in a muddy pool. You can actually move a tiny slick around with your hand.

When graphene is sprinkled onto the slick, the oil slick breaks up. The oil bonds to the solid and then gets swept out of the water when the graphene gets sucked up. Picking out the graphene is like pulling out sand. Watch it in the video. There was no oil left in the bucket.

Another cool thing: Graphene is incredibly light. The spice jar full of graphene weighed only a few ounces. Far less the salt.

"Scientists in labs can make graphene, but we are the only ones to produce it in production quantities," said Alisher Abdul, the CEO.

KP’s John Doerr on Greentech: ‘The Largest Economic Opportunity of the 21st Century’

Introduced by Venture Beat's Matt Marshall as "The best known investor in Web 1.0, involved in the founding of Amazon, Netscape, and Google," John Doerr and his firm, Kleiner Perkins, have raised a billion dollars to be channeled into greentech. 

"Greentech could be the largest economic opportunity of the 21st century," said Doerr.

Speaking at Venture Beat's inaugural Smart Grid event in San Mateo Calif., he offered his usual thoughts on greentech governent spending, the daughter Mary story ("Your generation created this problem you better fix it.") but he did add some interesting quotes:

• "The internet is a $1 trillion economy. Compare that with the energy business, a $6 trillion dollar economy."
• "The super grid is going to be the last great network we buid in our lifetimes."
• "Google took about $25 million to get to IPO," he said. Doerr compared that to Bloom Energy which has taken $350 million. "There is so much capital required to grow a great green company."  Bloom, which "has substantial revenues and orders required ten times as much capital – and we are seven years into Bloom. I wager nine years to a successful public offering."
• "Advice to investors: Don't count on additional government incentives."
• "In green in particular we have woefully underinvested."
• "My lesson about policy is not to argue about your self interest.  Make an argument that's bigger and about jobs or competitiveness – and you're going to change a few minds."
• "Energy is the the sum of all lobbyists."
• "If we had foreseen the crash, we might not have invested in green."
• He had three suggestions for carbon: "Put a price on carbon, put a price on carbon, put a price on carbon. It will be a signal to have private investors move their capital to low carbon energy."

Kleiner Perkins' cleantech investments include Bloom Energy (Fuel Cells), MiaSolé (CIGS PV), Solexel (3D Silicon Cell PV), Alta Devices (Stealth PV), Ausra (Solar Thermal), Altarock (Geothermal), Fisker Automotive (EVs) and several others.  Their smart grid investments include Silver Spring Networks and Hara Software.

Here's an interesting thing about VC investment in smart grid: Investors talk about it a lot but the numbers are low. It's a bit surprising to see the small proportion of smart grid deals relative to VC in greentech as a whole:



So are VCs talking and not diving in? Are they looking to see the outcome of Silver Spring Networks' utility roll-out? Are we only in early days? 

Or will these initial forays into Advanced Meter Infrastructure and Home Energy Networks give way to a bigger and steadier wave of other smart grid technologies like Vehicle to Grid, EV charging stations, data management and analytics, network optimization tools, and independent energy storage operators?

The next few quarters will tell. Smart people in Greentech Media's smart grid practice see a new smart grid innovation and investment wave about to break.

$1B Polysilicon Plant in Saudi Arabia

The First Energy Bank of Bahrain plans to build a polysilicon plant in Saudia Arabia to serve an increasing demand for solar energy generation in the Middle East.

The bank said it's teaming up with Project Management and Development Co. in Saudi Arabia to build the factory, which would cost about $1 billion, reported the Reuters. The factory would have an annual capacity of 7,500 tons; production is set to begin in 2013.

The Islamic bank plans to finance the project with 40 percent equity and 60 percent debt. Part of that debt would come from the Saudi government.

The developers already have signed an off-take agreement with Vinmar International in the United States, a petrochemical seller in Houston.

Countries in the Middle East are eager to invest in solar and other renewable energy manufacturing and generation. They see such investments as necessary to lessen their dependence on oil consumption and production.

Abu Dhabi, part of the United Arab Emirates, has invested in solar panel manufacturing and installations. Kuwait plans to solicit bids next year for a solar power plant. Saudia Arabia wants to build a 2-megawatt solar farm at its King Abdullah University of Science and Technology.