Fiat and Chrysler Pull Back on Electric Cars. Bad News for A123 Systems?

Fiat, the new owners of Chrysler, has apparently pushed back the effort to come out with an electric car, according to Reuters. Fiat has scrapped the Dodge Circuit, a two-seater electric sports car, as well as a plan to make a fleet of 220 electric and hybrid cars. The Department of Energy gave the company $70 million in grants in August to develop that fleet. Not sure if we get the money back.

The Envi electric car group has been absorbed into the regular car making group, Reuters said.

That could be bad news for battery maker A123 Systems. The A123 lost the deal to supply batteries to General Motors for the Volt earlier this year (although the two companies publicly vowed to remain friends). The Chrysler deal in April helped A123 rebound. The battery maker subsequently pulled off a successful IPO.

Will the changes at Fiat/Chrysler hurt? It's hard to say, but it's not great news. On one hand, Fiat and Chrysler still plan to come out with electric cars. Lou Rhodes, who headed up Envi, will head up electric car development for Fiat and Chrysler.

On the other hand, it sounds like electric cars are going to come out of the combined company later and at a slower pace. Chrysler earlier said it wanted to have an electric car out by 2010. On Friday, Fiat CEO Sergio "Marchionne told reporters and analysts electric cars would only represent "one to two percent" of Chrysler's sales by 2014, equivalent to less than 60,000 vehicles," Reuters wrote. The company is considering a delivery van in the U.S. Will they put some out in 2010 or will it be later? Hopefully more clarity comes next week.

"Until the (battery) storage gets resolved, I think electric vehicles are going to struggle," Marchionne was quoted as saying.

HP’s Data Center Smart Grid: Two Trends in One Name

Hewlett Packard has connected the dots between the trendy term "smart grid" and its work to make data centers more efficient.

Witness the HP Data Center Smart Grid line of products and services. Essentially, HP has integrated power and temperature sensors with displays and controls to help data center operators track and manage those variables.

It's all part of the race to integrate all the disparate data center efficiency systems, from more efficient cooling systems and less power-hungry servers to new sensor and control networks.

The competition includes giants like HP, IBM, BMC and CA as well as startups like SynapSense, Arch Rock, Sentilla, Power Assure and others (see Data Center Efficiency: Pulling it All Together and The Race for the Data Center's Brain).

Energy costs are a rising concern for data centers (see Data Centers Could Hit 'Resource Crisis'). Not only that, but some data centers can find their growth constrained by limits on the power available to them (see GE Looks to Data Center Efficiency and Sun: Data Center Efficiency for Everyone).

HP's new iteration on the topic includes its Thermal Logic-enabled line of server products, as well as the HP Performance-Optimized Datacenter, or POD - a set of servers in their own cooled cargo container for modular additions to data centers.

To manage it all, you've got HP Insight Control, its server management tool, which has power management capabilities, as well as the ability to track virtualized servers (see Virtualization, the Next Wave).

There's also the HP Data Center Environmental Edge system to visualize, analyze and measure power and cooling parameters in the data center.

The comparison of a data center to a utility distribution grid isn't that farfetched.  After all, many data centers have their own dedicated utility substations, making them little grids in their own right.

Applied Buys Advent Solar

Applied Materials has purchased most of the assets of Advent Solar in cash to boost its offering of factory equipment for making crystalline silicon cells and panels.

Albuquerque, N.M.-based Advent has developed a process that makes use of thinner silicon wafers to make cells with electrical lines on the back of the cell. Many manufacturers make cells with the contact lines – which transport electricity produced – on the front of the cells.

Putting the lines on the back would leave more room on the front to trap light, and that should boost electricity production. Founded in 2002, Advent also developed a process that it said would completely automate the assembly of solar cells into panels.

Advent had wanted to make its own cells and panels, and even signed a deal last year to buy $350 million worth of silicon wafers from Deutsche Solar.

In September 2008, Advent said it had lined up Enerpoint, MHH Solartechnik and SunConnex as its distributors. Advent had planned to ship 250 megawatts to these companies through 2013.

By March this year, Advent said it was in the business of licensing its knowhow.

The company raised $70 million in Series D in 2007, and that brought the total to $110 million. Investors included ZBI Ventures, Sun Mountain Capital, Globespan Capital Partners, Battery Ventures and @Ventures.  

Applied declined to disclose the purchase price.

Also on Friday, San Diego-based Applied Solar Inc. said it had completed the sale of its assets to Quercus APSO, a subsidiary of The Quercus Trust.

Quercus APSO plans to change its name to do business as Applied Solar LLC. Applied Solar plans to launch a product in 2010 that will be built into asphalt roof shingles, the company said Friday.

The company has listed some production descriptions on its website. One of them touted a panel embedded with crystalline silicon cells made by Suntech Power that would take place of the regular shingles.

Applied Solar, by the way, used to be called Open Energy. It announced the name change in January this year. 

EPA Wants Real-World Environmental Data From the Smart Grid

The Environmental Protection Agency is eager to see some utility data on the positive environmental impacts of smart grid deployments around the country. Just what it wants to do with the data is still up in the air.

That's the gist of comments EPA representative Stacy Angel made in a Thursday conference call hosted by the Electric Power Research Institute.

"What I would like is to see results from the deployments of where environmental benefits have been achieved," Angel said. Perhaps the utility industry could create a clearinghouse for such data, she suggested.

Estimates of the smart grid's impact on reduced greenhouse gas emissions, pollution from fossil fuel-fired power plants, and overall energy efficiency gains are all over the place.

A big one, EPRI's Green Grid study from last year, put the potential energy savings at 56 to 203 billion kilowatt-hours across the country. That could equal a carbon emission cut of 60 to 211 million metric tons, depending on factors such as how dirty the energy of a particular utility was to begin with, before it started using less of it through smart grid systems.

A more recent one from the Utility Telecom Council (see Smart Grid News) says a generic one-million smart meter deployment with distribution automation and some distributed power generation sources could cut about 300,000 tons of carbon emissions from a utility's footprint (see Smart Grid's Low-Tech Savings: Fewer Truck Rolls).

But Angel noted that emissions reductions claims and methodologies to calculate them differ. "What's the common – or any – approach to what we can attribute to smart grid?" she asked the 140 or so participants on the call.

The EPA would also like to see a distinction between direct improvements from smart grid systems – say, efficiencies from utility-controlled distribution grid automation systems – and the indirect impacts of enabling more energy-saving technology in utility customer's homes and businesses, she said.

A measure of the direct impacts comes from EPRI, which says that hooking up distribution and transmission grids with smart control systems could save the country about 300 billion kilowatt-hours, or a little less than 10 percent of the country's generating capacity.

The indirect impacts of things like home energy management systems, on the other hand, are harder to preduct, since they deal with the complexities of how customers will react (see Utilities Mull Price Points, Policies for Home Energy Management).

Angel was quick to point out that EPA wasn't demanding such data, nor was it actively engaged in measuring the environmental impacts of smart grid systems at present.

Rather, she said, "I hope that that clearinghouse is something useful for all parties."

GE to Close U.S. Solar Panel Factory

General Electric plans to close its only U.S. solar panel factory because production costs have exceeded sale prices.

The Fairfield, Conn.-based company told the Dow Jones Clean Technology Insight that silicon panel manufacturing at its facility in Delaware, will stop in January.

GE will shutter the factory all together by June. The factory can produce 34 megawatts of solar panels per year and employs 82 people. GE plans to layoff the workers with severance packages.

The move reflects the tough times experienced by solar energy equipment makers worldwide as supply far exceeded demand over the past year. Recession and a big reduction in solar subsidies in Spain - once a booming market - are key contributors.

Some manufacturers have seen prices for their products fall by anywhere from 30 percent to 50 percent over the past year.

Some solar company executives say the decline has slowed in recent months as demand picked up, mostly in Europe. But they remain worried about the pace of market recovery.

Earlier this week, Marlboro, Mass.-based Evergreen Solar said it would move panel production from its factory in Devens, Mass., to China next year in order to cut costs.

Earlier this year, BP Solar announced it would close its solar panel factory in Maryland and outsource that work to a contract manufacturer. BP said back then that it would continue to make silicon ingots, wafers and cells in Maryland.

Last month, BP said it had hired Jabil Circuit to assemble panels at a Jabil factory in Poland. 

Optimism in Venture Capital and IPO Outlook

Always On previewed its December Venture Summit with a breakfast at the offices of Wilson Sonsini Goodrich & Rosati (WSGR) this morning where it examined trends in finance and the VC outlook for 2010.

Tony Perkins runs Always On, christened Silicon Valley the "Athens of the Information Age." He asked the panel "if the economic recovery is real?"

Doug Merritt of SAP is in charge of sales to SAP's largest clients  (SAP will have revenues of $14 billion this year) and gave a 30,000-foot view.  "People were so panicked at the end of 2008, they didn't even know how to act," he said. But now "the largest organizations I deal with are actively investing." On the Greentech front, he detailed how Cisco's travel budget has dropped from $750 million to about $250 million, not because the company has reduced travel so much but because it has massivly increased meetings via telepresence.

Mark Reinstra of WSGR spoke of the IPO climate: "There have been ten VC-backed IPOs in 2009, but from an informal survey within the firm, we've seen many more companies preparing for IPOs just within WSGR."  The litmus test remains that a company needs $30M to $60M annual revenues to IPO." 

Ted Smith of Union Square Advisors said: "There's a lot of stuff coming in the top of the funnel but as far as actual M&A exits – it's a very high bar."

Jim Anderson of Silicon Valley Bank (SVB) works in the analytics group, and specailizes in valuations. "There is no question that valuations have dropped precipitously," he said, adding that there is a disconnect between the state of the economy and the multiples and valuations in the stock market.  He likened the state of the economy to a near-comatose patient on pain killers.  Unemployment goes to 10.2 per cent and the Dow jumps. "The U.S. economy is driven by consumer savings but consumers are hunkered down," he said. Anderson certainly sees significant growth from 2009 to 2010.

"But the little corner of the world that we operate in – the world of VC – innovators will continue to innovate. Adverse environment can actuallly produce the best start-ups," he said.

Sandy Miller, a veteran VC at Institutional Venture Partners (IVP) is "much more optimistic" than Anderson of SVB. He believes that "the financial markets almost invariably precede the recovery by two to three quarters. The financial markets have already recovered. There's an appetite for IPOs from institutional buyers, adding "The actual paramenters to go public have been virtually the same for the last thirty years." He also noted that "2010 will be a reasonably active year in the IPO market," and that "when the IPO market rises the M&A market responds as well." 

"Greentech company valuations are twice what we would expect for other sectors," he said. (Which is why he's staying away from those investments.)

"It's a great time to be an investor," Miller concluded.