Earth and Industry » Features

Has the Recession Doomed Cleantech Startups?

Maria Surma Manka — Wed, 25 Jan 2012 10:05:16 +0000

It hasn’t sounded very promising for cleantech startups lately. As even the big guys fail and falter (think Evergreen Solar’s bankruptcy or Vestas’ lay-offs), one begins to wonder whether the little guys can weather the economic storm of this recession, not to mention Congress’ generally allergic reaction to any sort of federal renewable energy standards or goals.

Furthermore, the budget and debt crises here and abroad have led many venture capitalists (VCs) and investors to hunker down and hold on to their money. Some federal policies encouraging renewables have similarly slowed or are in danger of slowing: The production tax credit (PTC) for wind expires at the end of this year, as does the 1603 Treasury grant program that provides cash support to solar start-ups.

After reading all of this negativity, I figured cleantech startups were doomed…right?

But startups are nothing if not nimble.

Some mid-sized companies are taking extreme measures, like moving operations to China: The Chinese not only have a very friendly cleantech business environment, but are the top global market for solar power.

Some analysts predict a wave of buy-outs, mergers, and acquisitions in cleantech markets like solar, especially among panel manufacturers.

And still other start-ups are sitting in somewhat of a cleantech sweet-spot, being small and nimble enough to adjust to the downturn while taking advantage of the stimulus funds Congress invested earlier in the recession. Of course, we can all point to Solyndra as the poster child for what can go wrong, but there are many examples of what can go right when the government invests in an industry hungry for innovators.

Silent Power is a distributed energy storage systems company that manufactures and markets backup power systems for renewable energy, typically solar power. Located in perhaps the unlikely locale of northern Minnesota, the company has developed a battery that can store power for renewable energy and release it back onto the grid during peak demand times, and is one of the few companies that has a system compatible with an advanced battery chemistry, such as lithium-ion.

“The stimulus money invested in the solar and smart grid sectors has created a lot of projects that will keep us busy through 2012 and beyond,” explained Todd Headlee, CEO of Silent Power. “Many of the customers for our renewable energy storage units have been the smaller utilities, like the municipals and co-ops. They can move more quickly to create and implement cleantech pilot projects than the big investor-owned utilities.”

Headlee went on to explain that these storage pilot projects aren’t just free money from the government: Oftentimes utilities have to match half of the project cost. But the desire for renewable energy storage is great and utilities are willing to experiment. As these projects pan out and the successful ones get noticed, more and more utilities have shown interest in smart grid products like Silent Power’s.

Although funding is a priority and a challenge for any startup, Headlee is optimistic about the future because of a few key policies and because of utilities’ hunger for a more efficient grid. For example, Californians are now able to apply for a $2-per-watt rebate for an energy storage unit. This is a huge incentive in a critical solar market that will keep the demand for products like Silent Power’s going. Although it has fewer than 20 employees, the company counts an impressive list of partners and customers, including the Sacramento Municipal Utility District (SMUD).

So although many cleantech start-ups have fallen victim to the recession, it’s not all doom and gloom. Many sectors will look very different coming out of the recession than they did going in, while others are able to corner a market supported by government investment, helpful policies and a returning optimism from VCs in particular areas like the smart grid and battery storage. The future indeed may still be bright.

Photo credit: Some rights reserved by bisgovuk

Live from Abu Dhabi on January 19: Masdar Digital Dialog and Global Tweetup

Timothy Hurst — Mon, 10 Jan 2011 11:03:14 +0000

Co-hosted by Masdar and LiveOAK Media, this compelling live event brings World Future Energy Summit delegates, journalists and social media enthusiasts together in one place to discuss and debate the hot stories and key themes emerging from this year’s summit – with a unique opportunity to engage a global audience. Even if you can't be in Abu Dhabi on January 19, we hope you can join us in this one of a kind global discussion. So bookmark this post and schedule a reminder so you don't miss it.

What: Masdar Digital Dialogue: Debate the issues. Engage the world.
When: 19th January 2011 at...

Sydney: 12:30-3:00am (Jan 20th)
Mumbai: 7:00-9:30pm
Abu Dhabi 5:30-8:00pm (GMT +4 hours)(Local Event Time)
London: 1:30-4:00pm
Boston: 8:30-11:00am
Chicago: 7:30-10:00am
Denver: 6:30-9:00am
San Fransisco: 5:30-8:00am

Where: The Saadiyat Story Gallery, Manarat Al Saadiyat, Abu Dhabi.
Where else: Desktops, laptops and smartphones around the world.

The #TweetMasdar hash tag will automatically be added to your tweets below:

Plastiki: A Lesson in Finite Resources Aboard a ‘Floating Sustainability Station’

Timothy Hurst — Mon, 26 Jul 2010 20:09:43 +0000

What an 8,000-mile journey across the Pacific on a boat made out of plastic bottles can us about energy efficiency and phantom loads.

When the expedition leader of The Plastiki, the sailing vessel made entirely of recycled materials and 12,000 CO2-filled plastic bottles, was faced with the option of decking out the boat with the finest, most expensive communications, satellite, IT and navigation gear--and he had the pick of the litter at expedition sponsor HP's company store--or going with equipment that was maybe one step down, but available at your local computer store, he opted for the latter.

"In a way wouldn't it be cooler if we just had stuff that was off the shelf?" expedition leader David de Rothschild told me on Friday as he and the Plastiki crew prepared for the final leg of a 130-day journey across the Pacific Ocean from San Francisco to Sydney.

"It seems real. It makes it attainable."

>>Read more about Plastiki's wired environmental campaign in ecopolitology's interview with David de Rothschild

"I feel good that we didn't go that route. Go down to your local computer store and you can get the technology we have off the shelf, and people are like, really, are you sure?"

De Rothschild says they wanted to look at the Plastiki like a closed system, or as he calls it, a "Floating sustainability station with finite resources." Living on a small boat in the middle of the Pacific Ocean for four months taught the Plastiki crew how to make the most of what they have. And since they were attempting to bring attention to the scourge of single-use plastics and the throwaway culture we live in, it would kind of defeat the purpose if the boat was only a resource-sucking PR stunt.

"It's simple things like optimizing your battery settings. Making sure you turn it off, not just leave it on standby and let it suck out the power. Making sure you unplug at the socket, at the main so you are not creating phantom loads," says de Rothschild, a self-styled technology geek who proudly adds that everything aboard the Plastiki runs on renewables.

"Not once did we turn on our generators to support our power -- which is no easy feat," he adds.

Now that the Plastiki is safely in port in Sydney, it will be open for public viewings for the next few weeks. After that, it's not entirely clear what will happen with the boat but de Rothschild and crew assembled the Plastiki without glues or resins, so when the trip is over, the entire boat is recyclable.

Photo credit: Plastiki

The 16 People You Must Follow on Twitter for Green Business

Timothy Hurst — Mon, 01 Mar 2010 15:02:36 +0000

From sharing news or quality content, to communicating with friends and communities of interest, the micro-blogging platform Twitter has something for everybody. And there are few communities of interest that have swarmed around Twitter with more fury than the business community. Granted, maybe 'business community' is too large a group to even classify as a community, but 'green business community' isn't. On that note, we bring you the Earth & Industry 16 must-follows on Twitter.

Now, this is not exactly scientific, but it's not arbitrary either. It should also be noted that we left out companies and focused on individuals unless they are in the business of writing about green business. And, of course, this is by no means the definitive list, so please leave your suggestions in the comments below to help make it one. Without further ado and in alphabetical order:

@adamwerbach Named the youngest-ever national president of the Sierra Club in 1996, Adam Werbach is now a business trategist tweeting tips for running a sustainable business. Author of new Harvard Biz book, Strategy for Sustainability.

@AlexSteffen While not strictly a 'green business' guy Alex Steffen of World Changing delves deep into the underlying problems at the root of sustainability. This undoubtedly means he approaches the world of business at multiple levels, but from a different perspective than most 'business people.'

@britesprite Chris Milton is a UK sustainability journalist and writer. Chris says he's never met the opportunity to write a feature he didn't like: "The thing is everyone, every business, is a feature waiting to happen. Because everyone, every business, is in some way unique and ground breaking."

@DavidCoethica David Conor's bio tells us that he knows a thing or two about CSR and ethical business. Conor is a sustainable business strategist, environment specialist, speaker and now blogger, using Coethica "to make the world a better place to live and work."

@DCarli Don Carli's Twitter bio says he's into sustainability, CSR, green, advertising, media, design, marketing and tech. If that weren't enough, Carli is Senior Research Fellow at the Institute for Sustainable Communication, a nonprofit working to develop "the next generation of communication and media leaders required to create green jobs, foster environmental restoration and improve quality of life in the communities they touch."

@fabianpattberg Blogging at FabianPattberg.com, among other places, Fabian Pattberg writes prolifically on the topics of sustainability, corporate social Responsibility and the use of social networking for business and individuals.

@gfriend Gil Friend is an engaging speaker, strategic sustainability thought leader and consultant. Gil is the CEO of Natural Logic Inc. and author The Truth About Green Business.

@GreenBizTweets The man operating the switches of the the official and informal source of green business news and conversation from GreenBiz.com is Hugh Byrne. The GreenBiz social media machine is much more than a twitterfeed of the network's wide-ranging content, Hugh has made curation and promotion of others' good content just as important.

@greenskeptic Blogging the new green economy as The Green Skeptic since 2004, Scott Anderson lends his expertise on cleantech and social-entrepreneurial ventures. When he's not busy trying to win converts on Fox Business News, Scott likes to spend some of his time shooting hoops and following the Boston Red Sox.

@GreenSmith Paul Smith describes himself as a "Sustainable/Green Biz Consultant. Digital PR. Blogger for Triple Pundit. Ghost Writer for ____. Social Media Demystifier. Brain for hire." Check out some of Paul's work at Greensmith Consulting.

@jetsongreen Preston Koerner at Jetson Green covers green building, sustainable architecture and small-scale renewable energy better than pretty much anyone in the space.

@Makower Joel Makower describes himself as "Founder of GreenBiz.com; bestselling author; speaker, adviser, entrepreneur in green business, green marketing, clean tech, blah blah blah." We couldn't have said it better, Joel.

@MarcGunther Writer, speaker and consultant on business and sustainability, Mark Gunther is a regular contributor at GreenBiz and a leading voice in the sustainable business. You can find some of Marc's work at MarcGunther.com.

@sustainablog Jeff McIntire-Strasburg is no stranger to green social media. Writing about sustainability and green business at Sustainablog since 2004, Jeff still finds time to teach college students how to write in sentences longer than 140 characters.

@TriplePundit No, not a person, but I couldn't omit TriplePundit from this list as it. Led by founder, Nick Aster, Triple Pundit has grown into one of the most insightful and reliable sources of green business news and featured content on the Web.

@WillSarni Will Sarni is Founder and CEO of DOMANI Sustainability Consulting and a regular contributor here at Earth & Industry. Will's expertise on water issues, brownfields remediation and sustainability reporting strategy.

Of course, you can also follow @earthindustry on Twitter. Tweets authored by the Earth & Industry writing team, anchored by editor Tim Hurst (@ecopolitologist).

Does the 2010 Ford Fusion Hybrid Live Up to the Hype? Yes.

Timothy Hurst — Wed, 10 Feb 2010 13:40:53 +0000

The 2010 Ford Fusion Hybrid and the future of the American sedan. (Photo: Tim Hurst)

The 2010 Ford Fusion was named Motor Trend Car of the Year. And that wasn't even the hybrid.

I couldn't have asked for a better time to get out of town. A strong winter storm was barreling down on Colorado and virtually every road surface in the state was covered in snow. I was about to head off for a long weekend to cover sustainability efforts at a music festival in sunny southern California. On top of this, my traveling partner for this excursion, Gas 2.0 editor Nick Chambers had secured a 2010 Ford Fusion Hybrid for an extended test-drive. There was a very good likelihood that if I didn't make my flight or if it was delayed, that I wouldn't be getting out at all.

Despite the fact that the plane I was supposed to get on to California never actually arrived in Denver, somehow the airline was able to find another and get us into the air.

By the time I landed in Long Beach, the storm was already to the east, the sky was blue and the air was warm. I grabbed my bags at the outdoor baggage claim looked up and saw Nick roll-up in a shiny-new Ford Fusion Hybrid.

All was right with the world.

The review

At first blush, the Fusion is a good looking and comfortable vehicle with a cool user interface and a comfortable ride. The Fusion isn't cheap. Starting at $27,625, it costs about five thousand bucks more than a brand 3rd Generation Toyota Prius. And at 41 miles per gallon (hwy), it won't get the mileage that the 51-mpg Prius will. But in terms of comfort, features, and its larger size, the Fusion is really more like a Toyota Camry than a Prius.

The first thing that I noticed when I got behind the wheel was that the Fusion's user interface has a lot going on. They call it the Dual LCD SmartGauge Cluster with Eco Guide that provides real-time information to help you squeeze the most efficiency from your Fusion Hybrid. While it could be a little overwhelming for the easily distracted, after making myself familiar with the cluster, I found the gauges to be plenty informative without having to look directly at them.

The SmartGauge with EcoGuide uses LCD screens on either side of the center-mounted speedometer. (A tutorial built into the display lets you choose one of four data screens for the level of information you want - Inform, Enlighten, Engage or Empower - and explains your options within each.)

On the data screen setting we opted for, the LCD screen on the left had guages indicating fuel level, battery level and miles per hour (with the EcoGuide indicator telling you when you are driving in EV-mode). You keep it in the green zone on the EcoGuide and the 2.5L Atkinson-Cycle I-4 Hybrid engine shuts off and runs completely off of the high-power NiMH battery. Keep it in the green and you are essentially driving an electric car. Continued...

Is Your Company Ready for Water Disclosure? Probably Not.

William Sarni — Wed, 02 Dec 2009 17:24:50 +0000

CDP announces The Water Disclosure Questionnaire for 2010 (Photo: laszlo-photo)

If you love the Carbon Disclosure Project Questionnaire, you will love the Water Disclosure Questionnaire. The question is: Are you prepared?

The CDP recently announced that they would begin sending out a Water Disclosure Questionnaire in 2010 to the largest 300 global companies and the questionnaires will be summarized in a report in late 2010.

I fully expect the CDP Water Disclosure Questionnaire to be as successful as the climate CDP questionnaires based upon the relatively rapid adoption of the CDP in motivating companies to discuss the risk and opportunities of climate change to their businesses. The CDP was launched in 2000 with the goal of collecting and distributing information on climate risks and opportunities. The CDP now has over 2,500 organizations in 60 countries measuring and disclosing their greenhouse gas emissions and climate change strategies.

These organizations voluntarily quantify their greenhouse gas footprint, set reduction targets and improve performance. The disclosure information is made available to institutional investors, corporations, policymakers and their advisors, public sector organizations, government bodies, academics and the public.

Equally impressive as the number of organizations that disclose greenhouse gas information is that the CDP is represented by over 475 institutional investors, holding $55 trillion in assets under management. This is the real driver for voluntary disclosure—investors are asking for this information—and why the Water Disclosure Questionnaire will be a critical aspect of corporate strategies and communications.

The Water Disclosure Questionnaire will help institutional investors understand the risks and opportunities from water scarcity and water related issues confronting businesses. Global financial institutions such as NBIM, Schroders, APG Asset Management and Dexia Asset Management support this new CDP program and have taken the lead on developing an understanding of water risk to their investment portfolios.

According to the CDP, the rationale for the water disclosure questionnaire is that “companies face risks such as lack of water impacting agricultural and manufacturing processes and the threat of regulation increasing prices and limiting the volume of water available to them.” Moreover, the lead sponsor of the CDP Water Disclosure Project, NBIM stated “as water becomes an increasingly constrained resource, it also becomes an investment issue. It is vital that institutional investors have access to high quality information on how water-related risks threaten corporations, both directly and within their supply chains, in order to make better-informed decisions and direct the flow of capital away from risks and towards solutions. CDP Water Disclosure will be essential to providing investors with this information.”

Report shows ample room for improvement in corporate water accounting

The announcement of the project came with the release of a CDP report titled, “The Case for Water Disclosure”. This report is a must read as it not only lays out the rationale for water disclosure but summarizes the results of a small scale water disclosure pilot project initiated by CDP in 2008 (as part of the CDP Supply Chain project).

The pilot project demonstrated that for the most part companies have the ability and are willing to disclose information on water data and water issues. The key findings from the report were mixed:

The good news? Most companies do have information on their direct water usage. More than half of the respondents see water as an opportunity and many companies have a water management plan, but only for their own plants.

The bad news? Most companies do not have data on water use or water issues in their supply chain. Only half of the respondents saw water as a risk for their business and for their supply chain. And apparently that is especially true for the food and beverage industry as no companies in the industry responded to the questionnaire.

My advice for any company is to measure your water footprint, identify risks and opportunities (direct and indirect water use) and be prepared to disclose how you will manage your water related risks and what are your business opportunities look like.

Your investors are waiting for your response.

Green Community Models: The Business Incubator

Jeff McIntire-Strasburg — Tue, 01 Dec 2009 14:33:09 +0000

A new wave of business incubators are beginning to spin-off green--and profitable--business ventures.

If you're old enough to remember the dot com bust, you may associate "business incubators" with small online companies with a cool idea and a lousy monetization strategy. While past incubators may have given life support to start-ups that may not have deserved it, a new generation of these organizations (both for- and non-profit) are springing up to support eco-minded start-ups.

While we'll have to wait to see if this model ultimately works for green business, the marriage of these two concepts seems almost ideal: the concept of a community of entrepreneurs that share resources -- capital, knowledge, space, and equipment -- fits quite nicely with the values of green business.

What is a business incubator?

According to the National Business Incubation Association,

Business incubation is a business support process that accelerates the successful development of start-up and fledgling companies by providing entrepreneurs with an array of targeted resources and services. These services are usually developed or orchestrated by incubator management and offered both in the business incubator and through its network of contacts.

The association distinguishes incubators from coworking arrangements and research parks by the element of assistance tailored specifically to emerging companies.

Are business incubators always green?

Not necessarily in focus, or in the companies they support. By offering material, financial, and knowledge support, however, incubators ideally maximize resource efficiency for new companies, allowing them to focus on building financial sustainability. Business incubators are often also focused on broader community economic development.

So, what makes a green business incubator green?

In general, green business incubators focus on supporting the development of start-ups built around a sustainable/triple bottom line business model. In a number of cases (New York's Green Spaces, Chicago's Green Exchange), the incubators work to insure a green space, whether a building constructed to LEED standards, reused/reclaimed office furniture, or even renewable energy sources.

Are business incubators non-profit organizations?

Often, but not always. Green Spaces and San Francisco's Virgance are among the 4% of incubators that are for-profit. (Disclosure: I'm a stockholder in Virgance.) In about 25% of cases, incubators take an equity share in the companies they support, according to the 2006 State of the Business Incubation Industry report.

Where can I find out more about green business incubators?

There doesn't appear to be a central repository of information on sustainable business incubators, so the best sources of information I've found are NBIA and green incubators themselves. Others not mentioned above:

The Sustainable Business Incubator at Farleigh Dickinson University
The Clean Energy Incubator, a part of the University of Texas' Austin Technology Incubator
Rhode Island's Gordon Avenue Business Incubator

I've also run across several good articles on green incubators, including

"NYC incubator helps green companies grow" (Crain's New York)
"New Incubators Will Nurture Green Business" (NJBiz.com)

Of course, if you're in any way involved with a green business incubator, let us know more...

Other green community posts: This post is a part of a multiblog series on green community models. I’ll link to new posts as I get them written and published:

Ecovillages
Cohousing
Coworking
New green development

Jeff McIntire-Strasburg is the founder and editor of sustainablog. Follow him on Twitter @sustainablog

Image credit: equitus / CC BY 2.0