Venture-capital investments insolarpower have surpassed investments in biofuels so far this year, according to Eric Wesoff, a senior analyst at Greentech Media Research.
Investments in solar have already reached about $1.2 billion so far this year, just over $1.1 billion -- a record amount for any greentech sector -- that VCs spent in 34 biofuel deals last year, he said.
That solar-investment figure is up from less than $400 million in VC investments for the whole of 2006 and less than $200 million in 2005.
Average deal sizes also have increased from $11 million in 2005 to $17 million so far in 2007, Wesoff said. But the average was apparently skewed by a few large deals, with median deal sizes growing more gradually from $8 million in 2005 to $9 million in 2006, then staying flat at $9 million in the first three quarters of this year.
Venture-capital numbers vary widely among different groups tracking greentech investments.
VentureOne and Ernst & Young show U.S. cleantech investing third-quarter figures totaling less than $867 million, while Cleantech Venture Network said the North American sector brought in $1.3 billion.
According to Wesoff, the most active solar VCs include Draper Fisher Jurvetson, Firelake and Good Energies.
The bulk of those VCs' solar investments in the last few years have gone into backing thin-film technologies, Wesoff said. This year, thin-film investments made up about half of the 1.2 billion that VCs have spent on solar startups so far.
Solar investments are likely to continue to grow, Wesoff indicated. Almost half of the 37 VCs he polled said they expect to make solar investments through 2008, he said, and half said they are looking to invest in new materials that would replace crystalline technologies.
Still, Wesoff said VCs also had concerns about investing in solar -- mainly about irrational valuations, subsidies and regulations and an overcrowded field.