The modern greentech movement, if truth be told, started by accident.
In January 2001, then-California-governor Gray Davis declared a state of emergency because of rolling power blackouts. Enron, rightly, got the blame and imploded soon afterwards. CEO Ken Lay stepped down, Davis got recalled, and Arnold Schwarzenegger got the opportunity to recycle one-liners from The Terminator as the state's new governor. Arnold's stint as governor helped California become the epicenter of green technology development. As Enron imploded, a number of startups that would become big names -- for good and bad reasons -- were emerging from garages at the same time. Here is an update on how they are doing.
1. MiaSolé. Founded by Seagate alumnus Dave Pearce, MiaSolé promised to produce inexpensive copper, indium, gallium selenide (CIGS)solarcells with processes and equipment from the IT industry. By 2006, MiaSolé was hot stuff and pulling in wads of cash from VCs. It became one of the CIGS six -- MiaSolé, Solopower, Solyndra, Sulfurcell, HelioVolt and Nanosolar -- that have pulled in over $2 billion from VCs.
And like those others, MiaSolé discovered CIGS is not easy to work with. Delays and management changes followed. (Fake Steve Jobs' Dan Lyons refers to the company as "My A__hole.")
Flash forward to 2010. The winners and losers -- and CIGS technology itself -- seems to be becoming more clear. MiaSolé in 2010 emerged from its hidey hole and started shipping panels commercially. It also began to hit its efficiency milestones. MiaSolé recently raised $106 million and wants to hold an IPO this year. Out of the six, it might be doing the best. Still, MiaSolé has to contend with declining prices of crystalline silicon and First Solar's cadmium telluride juggernaut.
Two others were founded that year. Sulfurcell, which adds sulfur to the recipe, is producing around 15 megawatts a year, carving out a niche market. By contrast, HelioVolt, which came up with a FASST manufacturing process that has bewildered many, started in the same year. It has missed a few mass manufacturing milestones, is up for sale and produces more PowerPoint slides than panels. (Hear more about CIGS at the Solar Summit on March 14 and 15.)
2. Bloom Energy. Originally it was called Ion America, so naturally people thought it was a competitor to Entertainment Tonight. Actually, Bloom was working on a solid oxide fuel cell, a technology that has stymied many for years. Initially, the fuel cell was destined for military customers. Kleiner, Perkins thought of it as a post-9/11 defense investment. It evolved into an industrial fuel cell that can convert natural gas or biogas into electricity. The company has raised over $400 million and is making approximately one 100-kilowatt Energy Server a day. With subsidies, the servers churn out power for less than its costs customers like Adobe to buy retail, but the subsidies are unnaturally good.
Overall, it is quite promising, but the big question is whether the fuel cells can perform as expected over a ten-year period. Customers such as Panasonic and Ceres have popped up, too. But you can't beat Bloom for generating buzz.
3. Suntech Power Holdings. The company, founded by a Chinese professor named Zhengrong Shi from the University of South Wales in Australia, was born in September 2001. Traditional VCs missed out: the primary early investor is China's Communist Party. Suntech, based in Wuxi, went public in 2005 and now jostles with First Solar for the top spot in the solar market. The success it achieved paved the way for other Chinese solar makers like Yingli Green Energy and Trina.
With success have come headaches. The vaunted high-efficiency Pluto panels have suffered delays and production issues and Suntech's effort to become a developer through its Gemini joint venture was killed off. Still, Suntech has amassed a strong channel of installers and developers and has continued to tinker with panel design and installation to reduce costs. It will be a force to contend with for years.
4. SunPower. SunPower wasn't born in 2001; it was reborn. Cypress Semiconductor CEO T.J. Rodgers plunked $750,000 of his own money into a struggling outfit called SunPower after nearly everyone else in Silicon Valley, including Cypress' board, turned the company down. The investment allowed the company to recover. in 2005, it held. Rodgers' investment, which eventually got bought by SunPower, eventually turns into $2.5 billion.
SunPower's high efficiency panels are some of the most expensive in the industry. Nonetheless, management has proved to be nimble. SunPower was one of the first solar companies to market its brand to consumers. It pushed into utility-scale solar parks and remains, after First Solar, one of the leaders in the field. Next up, it will try to take concentrators to the mainstream. SunPower has to struggle, but it manages to move ahead.
5. EnerNoc. Tim Healy and David Brewster from the Tuck School of Business at Dartmouth founded the demand response company with the wacky idea that utilities will pay to have peak power shaved. Their main tool is a phone: EnerNoc reps call up their clients and tell them to turn down the air conditioner or industrial boiler. The utility is pleased, the client is happy and EnerNoc gets paid.
VCs initially ignored them (anyone see a pattern here?). Eventually, Draper Fisher Jurvetson and Foundation Capital invested and EnerNoc (along with competitor Comverge) went public in 2007.
Flash forward to today. Revenue for 2010 came to $280.2 million, up 47 percent from revenue of $190.7 million in 2009. Net income, meanwhile, came to $9.6 million, and acquisitions are allowing the company to expand into a full-fledged energy provider. Overall, EnerNoc can now call on 5.3 gigawatts of capacity during demand response events. In 2011, revenue should come to $300 million to $320 million, or a four percent increase -- less than the jump from 2009 to 2010.
Right now, however, it is arguing with PJM over how much demand response companies should be compensated.
6. GreenFuel Technologies. Spun out of research at Harvard and MIT, GreenFuel proposed pumping carbon dioxide from smokestacks into clear plastic bags filled with algae called bioreactors. The algae would feast and be turned into diesel. The company, which raised $79 million from DFJ and others, put algae on the map. Unfortunately, reality didn't cooperate. An expensive pilot project in Arizona never worked properly and GreenFuel went under. It sold its intellectual property for a very small figure to company funded by the Bronfman Family (think Crown Royal) and John Perry Barlow, the B-League lyricist for the Grateful Dead.
Solazyme, which uses a very different process for algae, is prepping for an IPO.
7. Konarka. Have you no shame, sir? Always bringing up Konarka. The Massachusetts-based company specializes in solar dyes and other futuristic solar technologies. Some of the technology comes from a Nobel Prize winner. But, despite hoovering in over $160 million from investors and government agencies, its technologies are still only inching toward commercialization. The decline in crystalline silicon solar prices will continue to make life difficult for alternative chemistries.
Konarka was an early a trend setter in the really, really long runway department. But there are lengthier ones on the record: wave power specialist Pelamis got started in 1998.
8. A123 Systems. This third member of the Massachusetts trio of 2001 went public in 2009. However, life has been tough since then. The battery maker lost the contract to supply batteries to the Chevy Volt and a deal with Chrysler faded away. Black & Decker, once A123's biggest customer, has largely switched to Sony batteries. The bright spot comes in grid storage: AES uses its batteries. The stock sits at $9.75, below the IPO price and half of the post-IPO-hoopla price, and A123 regularly reports losses. Still, batteries aren't an easy business. Just ask Imara (defunct) or Boston-Power (still in ramping mode).
9. Canadian Solar. Another solar success story. The company produces solar modules and has recently expanded into power plant development. Module capacity came to 1.3GW at the end of last year and will grow to 2GW by the end of this year. CEO Shawn Qu tells us that the company now wants to begin to incorporate electronics and later batteries and microgrid technology into products. Last year shipments more than doubled. It IPOed in 2006 without the celebrity investors.
10. Akeena Solar/Westinghouse Solar. This solar installer and panel manufacturer went public, but soon found itself in an ever-crowded market. In 2010, it is renamed Westinghouse Solar and gets out of installation. Is solar ready for traditional brands? Some companies -- Polaroid, Westinghouse -- tried this in LCD TVs in the beginning of the decade. It only worked for a little while. But solar is a closer cousin to Westinghouse's traditional products. General Electric will get back into solar with cadmium telluride panels soon. Time will tell.
The Class of 2002. Coming tomorrow.