we’ve “come got to sense of reality in the energy materials sector,” and that “a lot of people jumped in head first and may be now taking a step back and looking at what makes sense for venture investing” in areas like solar and wind. She did find promise in a few slices of cleantech, such as:
- Energy storage technology. Sheinbein says that piece of the puzzle is needed for renewable energy products to really take off. She pointed to A123 Systems, (NASDAQ: [[ticker:AONE]]), a Watertown, MA-based maker of advanced lithium-ion battery systems, which has spun out an energy storage technology company called 24M Technologies.
- Developing information technology surrounding natural gas and water infrastructure. There’s promise in technologies for managing natural gas drilling and for better monitoring the water system. She also sees potential for technologies to spring up in the area of treating industrial wastewater.
- Networking technology targeted at energy efficiency. “That’s a comfortable space for venture investors to work in—they know it from other parts of their portfolio,” she says.
—Not everyone is grim on solar. Like Steve Hall, managing director at Seattle-based Vulcan Capital. “After a two-year drought of capital access and valuations challenges, a number of solar start-ups will have weathered the storm and start to show real progress on commercial deployments, manufacturing capacity, and competitive costs per kilowatt hour,” he wrote in his New Year’s prediction for us. “While it is unlikely this sector will be positioned to see new IPOs, a few early winners will emerge and bring new investor enthusiasm to the sector.”
—Seattle-based Eric Koester predicts that existing companies will add a green product or focus to their business, and companies will incorporate wider IT trends—like crowdsourcing, geo-location, and gaming—into their businesses as ways to go green. Examples would be a Web-based platform to organize ridesharing to cut down on fuel usage, or mobile developers offering technology for finding local, organic food items. He’s the author of the recently published Green Entrepreneur Handbook. (He wrote on the subject for us here and here.) “I see more and more businesses springing up in areas such as Green IT, smart grid, home-based energy monitoring, distributed solar/wind/geothermal, and energy efficiency plays. These are all sectors that tend to be a bit less capital intensive and really represent a cross-section of green and non-green technologies,” he says.
Putting this all together, perhaps the U.S. position in cleantech isn’t as bleak in the long run as some may paint it to be. While other countries may have the manufacturing advantage in the short run, there’s still room for the U.S., says the Washington Clean Technology Alliance’s Ranken. “I think sometimes we view our competition as having no flaws,” he says. “Over time what emerges is we’re really good at some things, they’re really good at some things; we find our niche, they find their niche.”
