Cleantech Blog

Wednesday, February 13, 2008

Taking Control

by Heather Rae

Maine Congressman Tom Allen hopes to dislodge Senator Susan Collins from her Senatorial seat. Allen spoke a few weeks back at an event sponsored by the Hydrogen Energy Center and other energy-oriented organizations at the Frontier Cafe in Brunswick. Allen said that without the right kind of leadership in the executive office, real progress on clean energy will not be made. As we've seen.
While the Pentagon asks for the biggest budget hike since World War II, the Bush clean-tech plan gets mixed reviews. Christian Science Monitor Reporter Brad Knickerbocker writes: "After seven years in office, President Bush's positions on energy and climate change are clear: Emphasize increased energy supplies over conservation, favor voluntary steps to reduce greenhouse-gas emissions, oppose international efforts to force changes in national policy, and make sure nothing puts too much stress on the economy." (See Dick smile.)
Grist has posted a chart of the presidential candidates' positions on energy and climate, and Solar Nation has posted the League of Conservation Voters' round-up.
Not waiting for the leaders to get on board, or steer the nation into a ditch, Maine's Midcoast Green Collaborative is organizing its second clean energy exposition in Damariscotta. Last April, the Expo was well-attended, focused and informative. Peter Drum, a young attorney who moved his practice from Washington to his home state of Maine, is one of the founders of the Collaborative. In the leadership vacuum, smart, hardworking visionaries step in.

"On April 18, 2008, Midcoast Green Collaborative is holding our second annual Maine Sustainable Energy Expo). This event is designed to showcase sustainable building and remodeling methods and technologies, sustainable energy production technology, and more sustainable transportation choices.
The Expo puts consumers in touch with vendors and contractors who specialize in green home building and renovation and renewable, disperse energy production. Some attendees told us that from the vendor/contractor side, they had more serious contacts at our show than at any other event in the State including the Bangor and Portland home shows.
From the consumer side, they were thrilled to see that so many sustainable energy technologies were available in-State. We would love to get input from all of you and invite you to attend. Last year, we had an overwhelming response.
Though we marketed the event from Portland to Bangor, we actually had attendees from as far as New Hampshire and New Brunswick, Canada. Thousands of people attended our event and we believe that it is the biggest event of its kind in Maine. The exhibitor lists were filled shortly after they were sent out. We are now trying to locate additional space for other exhibitors who have contacted us.
The greater social impact of this effort might not be obvious, but we feel that the potential impact of efforts like our Expo are incredible. Maine Watch, this weekend, highlighted LIHEAP (Low Income Home Energy Assistance Program). While programs like LIHEAP are critical to getting people through this winter, the answer, really, is to make it easier to get through the winter.
Our governments have been woefully irresponsible with our energy policy. By keeping energy artificially cheap, we have provided little incentive to winterize and weatherize homes, introduce more efficient transportation choices, and consume locally. On the other end, we have provided very little regulation for home/factory home/mobile home construction for insulation, CAFE (coporate average fuel economy) standards have not been raised in over two decades, and very little money has been provided for renewable energy research.
Therefore, U.S. policy has provided neither significant market incentives nor increasing efficiency regulations over the last 28 years. Our efforts will make it easier for people to make it through the winter here. Our goal can be reached with green home building, better energy standards that are enforced for all new homes, and renovating the current housing stock.
With our initiatives, we are hoping to 'teach people to fish' rather than giving them a fish (i.e. LIHEAP). Our energy audits offer performance improvements that range from very inexpensive (replacing old bulbs with CFLs) to expensive (replacing all of the windows in a home) and gives the approximate energy savings of each improvement.
People are grumbling about the economy and with good reason. The stimulus package, as it was so aptly pointed out by a morning edition commentator, is a little like the Federal government saying to its close friend 'Gee, I am sorry that you have cancer. Have a cookie, you'll feel better.'
If we truly want to change our economic well-being, we HAVE to get our energy use under control. Frankly, every President and Congress since Carter has been completely irresponsible about the most pressing issue of our time; fossil fuel dependence. Nixon arguably did more than Reagan, Bush, Clinton, and Bush the Second put together.
If you want to track the U.S. economy, you need only look at fossil fuel prices. In the 1990s, fuel was cheap and the economy roared. Today, oil is nearly three times the cost it was just a few years ago. When the average home heating budget goes from $1200 to $3600 a year, that is a big decrease in disposable income and does not include the additional expenditures for gasoline that further erode disposable income. These increased fuel costs make everything more expensive because of the structure of our economy. Food is grown in intense cultivation, shipped and average of 2500 miles in cold storage, and then consumed. The same is true of retail goods made and shipped all over the world.
This is probably the most counter-productive structure for an economy and can only exist in an era of dirt cheap fuel. Those days are fast becoming history. This goes for all goods. Of course, as everything gets more expensive, more people are pushed into foreclosure, bankruptcy, etc.
Fossil fuels are not going to get less expensive, significantly, ever again. In fact, they are even undervalued today. If you want an idea of the amount of 'human labor' stored in a gallon of gas, just try to push your car the number of miles that it gets per gallon. If your car gets 20 miles per gallon, try to push it 20 miles.
If we, as a nation, don't do something soon, we are looking at a long term, perhaps never-ending depression in this country from today's standard of living as oil prices rise, global climate change and ocean level rise (and the huge impacts from such events), and increasing marginalization and indebtedness of the U.S. as a world power (see the Wall Street Journal's recent article about the diminishing power of the U.S. vis-a-vis Russia and other oil states) . That is why these are such critical issues.
Our energy Expo is just our first step in trying to help solve, what is really a quiet national emergency. The good news is that there is still time, though very little, for the U.S. to retool its economy and civilization. We must dramatically change but such change is possible. The Expo is a way for us to do our part to get our communities to change and is thus a positive and empowering event. We can take control of our energy future and usher in a new era of energy independence, local sustainability and domestic economic development, we need only make the commitment to do so."

Other Goings On This Week
I was to head to Washington with my husband of 2.5 months, and scheduled to ask Senator Collins a few questions about federal energy policy to "fair and balance" Allen, Grist, Solar Nation and all. It turned out to be a wretched week; my husband collided with a sand truck on icy Route 1. He emerged alive and OK, but with cracked neck vertebrae. Washington (and heaven, thankfully) can wait. My thanks to everyone who has expressed support, to PenBay and Maine Medical Hospitals, to amazing family, and especially to Dr. Chip Teel.

Labels: "home performance" "green building" sustainability, cleantech, energy, green, green tech

Tuesday, August 21, 2007

Media Buy-outs Going Green

Green and clean media is going through a flurry of activity right now. And while still small as media companies go - just wait.

A few of the notable deals:

Just announced yesterday: The Cleantech Group, who popularized the term cleantech as an investment class, acquired Inside Greentech, an emerging media outlet for the green sector, for an undisclosed amount. Both of these businesses are run by friends of mine - and make for a great hook up. We did a blog in July on "Cleantech vs Greentech" that proved to be a bit prescient, it now seems. The inside scoop on this deal from a chat I had with my friend Dallas Kachan, the publisher and founder of Inside Greentech "Inside Greentech is already the most widely-read trade publication covering daily business and technology developments in cleantech. As Cleantech.com, we will become the highest profile, go-to media platform for cleantech-related developments."
Leading green blog portal Treehugger was acquired by Discovery Channel just a few weeks ago. The deal metrics were rumored to be a $10 mm purchase price for a 1.4 mm hit/month site. This deal got a tremendous amount of press - and helps anchor the feeling that mainstream media deals and cleantech title launches are not far away.
Lightspeed Ventures and Northpoint Private Equity recently backed the launch of Greentech Media, including the acquisition of the cleantech focused Venture Power Newsletter - popular in the venture capital sector.
And while I can't say who, there are a couple of other big names in the sector with deals in the works.

Before Dallas Kachan and I finished our chat, I asked him what we should expect from all of this - his short answer was that as the cleantech sector continues to explode the big media names are going to take notice.

Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog, a Contributing Author for Inside Greentech, and a Contributing Editor to Alt Energy Stocks.

Labels: alternative energy, cleantech, Cleantech Blog, energy, green, green media, green tech, greentech

Friday, August 03, 2007

Saturday, July 21, 2007

Thursday, June 14, 2007

Thursday, June 07, 2007

Cleantech Media Juggernaut is NOT Slowing Down

There is still lots of talk about a bubble in cleantech, in part because the media juggernaut that cleantech has become is NOT slowing down. You can always track the substance by watching what happens in the media and networking, so . . .

New things launched from some of my favorite media in cleantech:

Yahoo! has launched Yahoo! Green. The cleantech website for the mass market.

AltEnergyStocks.com, my favorite stock site in this sector, has launched a Cleantech News section.

The Wall Street Journal has launched Energy Roundup of the best of the blogosphere.

Major conference operator Terrapinn has entered the cleantech sector with GreenVest 2007 coming up locally in San Francisco on June 25-27. (I'm chairing it, so I promise it will be good!). But the real draw to this one are the point and counterpoint keynotes of Khosla Ventures and Cleantech Capital Group.

And my friends at Cleantech Capital, who started it all, have launched CleantechSearch.com, which since I have three of our startups actively out looking for execs, I can attest is in serious demand.

Just for grins, let us know in our comments section of any new product or website launches in cleantech and clean energy that you find of note, and whether you think they represent bubble, or substance.

Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog, a Contributing Author for Inside Greentech, and a Contributing Editor to Alt Energy Stocks.

Labels: alternative energy, cleantech, Cleantech Blog, energy, green, green media, green tech, greentech

Thursday, May 03, 2007

Cleantech Venture Capital - Still Rising

As part of our ongoing series on stories on investment in the cleantech sector, we had a chance to discuss the sector with one of the venture capitalists at Emerald Technology Ventures.

Scott MacDonald is an Investment Director with Emerald Technology Ventures, a global leader in cleantech venture capital. Founded in 2000 under the name SAM Private Equity, Emerald is a pioneer in this rapidly emerging sector and is focused on innovative technologies in energy, materials and water. With offices in Zurich, Switzerland and Montreal, Canada, Emerald manages three venture capital funds and two venture capital portfolio mandates totaling over US$380 million. Scott currently serves as Chairman of RuggedCom and as a Director of Solicore and SoftSwitching Technologies. Prior to joining SAM, Scott held the position of Managing Director at OPG Ventures Inc., the venture capital subsidiary of Ontario Power Generation. Previous to OPG Ventures, Scott worked for ACF Equity, an early-stage venture capital company focused on investing in information technology companies. Scott graduated with a Bachelors degree from McMaster University and an MBA from Dalhousie University. He is a member of the North American Advisory Committee of the CleanTech Venture Network.

I know a bit about the history of SAM and Emerald Technology Ventures, and as one of the oldest cross-border investment groups in the cleantech area, I am very curious to get the Emerald Technology take on a number of issues. So we put to Scott a few thoughts and questions to get their take:

Emerald sponsored the San Francisco GreenVest 2007 conference I am chairing in June, and you are speaking there – can you share a few of your insights on the future of the cleantech area as an investment asset class?

I think we are in the early days but there is certainly an element of notoriety that the sector has attracted over the past 12 months with scientists, politicians and venerable VCs claiming action is required now to save the planet from global warming. A reputable and experienced LP in the venture asset class told me just last week that every generalist fund they speak with mentions an initative in cleantech. I think the great generalist funds will invest in the sector (as you know a few already are) and they will likely be successful. The specialist funds like Emerald will continue to map out and invest in innovating technologies because of our technical expertise and experience. Based on a number of successes exits to date in our first funds (Evergreen, Schmack Biogas, Pemeas), the specialization strategy seems to be working well. A really exciting development is that we are starting to see repeat entrepreneurs. Cleantech entrepreneurs that have successfully exited and are looking to try it again – and we couldn’t be happier. This was a key factor in the growth of the IT sector in the late 80s and 90s.

And can you fill me in a bit on the ins and outs of the recent fund history – the mandates with CDP and Ontario Power, your fund raise last year, and the subsequent MBO to form Emerald?

In 2000, SAM Group (Sustainable Asset Management), a leading asset management company specializing in sustainability investments and headquartered in Zurich, launched SAM Private Equity as its venture capital arm. That same year SAM Private Equity closed the SAM Sustainability Private Equity Fund and the SAM Private Equity Energy Fund with a combined EUR 90 million in commitments from leading institutions and strategic corporations. Both of these first funds are fully invested. In 2004, SAM Private Equity was awarded the portfolio management mandate from la Caisse de Dépot et Placement du Québec (CDP), a large Canadian-based pension fund, to manage its direct energy technology venture capital portfolio. Following the awarding of this mandate, SAM Private Equity increased its North American presence with two former members of the CDP team and established a North American office in Montreal, Quebec. In 2005, SAM Private Equity was awarded its second portfolio management mandate from Ontario Power Generation, a large Canadian electric utility, to manage its direct energy technology venture capital portfolio. To further strengthen its North American investment focus, two members of the former venture capital arm of Ontario Power also joined the team.

In March we announced the final close of our latest cleantech focused venture fund with commitments of EUR 135 million (US$180 million). We are going through a name change but the fund will be renamed Emerald Technology Ventures Fund II. Strong investor demand helped us exceed our original target for the new fund of EUR 100 million. Investors in the new fund are leading investment companies, financial institutions and multinational corporations from around the globe including: GIMV - Belgium, Rabobank - Netherlands, Caisse de dépôt et placement du Québec - Canada, Axpo Holding - Switzerland, Springbridge Limited (Advised by Consensus Business Group – UK), Credit Suisse - Switzerland, Deere & Company - USA, DSM Venturing - Netherlands, The Dow Chemical Company - USA, KPC Energy Ventures, Inc. - Kuwait, Piper Jaffray Private Capital - USA, Suncor Energy Inc. - Canada, Unilever Corporate Ventures and Volvo Technology Transfer AB - Sweden.

I have to ask, the name change – Sustainable Asset Management was an old brand in the cleantech investment sector, why the name change to Emerald?

Following the buy-out we are a private independent VC manager now and as such can no longer use the SAM brand. The SAM brand is powerful but it also was the source of some market confusion for our venture capital division. It’s clear now that Emerald is an agile and independent global VC manger with in-house expertise in the cleantech sector focused on investing exclusively in the cleantech sector and we have a new fund to do deals.

How many deals have you done from the new fund, how much capital have you employed, and what are you expecting to do over the next 12- 24 months?

We have made three investments out of the new fund and are closing on two more which should be announced within the month. We have only announced two of the investments to date – Vaperma and Identec (details of each is on our web site) www.emerald-ventures.com
I would expect we will invest in about 6 portfolio companies in total this year. We like to invest between US$2 -5 million in the first round depending on the opportunity and the stage. Technology, market and management are what’s important to us – we will consider all stages. Well…if it’s just a conceptual idea on a bar napkin we need to know the entrepreneur has made himself and others very wealthy in the past (preferably us – back to the serial entrepreneur comment).

What’s your passion these days? What technologies are you focused on?

I think there is an incredible opportunity for new technologies to help upgrade the antiquated electricity grids in Europe and North America and to leap frog into the incredible build-out that is going on in countries like India and China. China last year built an average of five 300 megawatt electricity plants a week and energy consumption is expected to continue rising fast as China aims to quadruple the size of its economy by 2020. This means a lot of new grid infrastructure technology will be deployed. We have a number of portfolio companies in the “smart Grid” space and will continue to seek out investments in this space.

You’ve had a couple of recent exits in fuel cells – what fund were they from, and has that changed your appetite for similar technology areas in the future?

We have had recent exits in this area: Pemeas which we sold to BASF and Cellex which we sold to Plug. We still have an number of other FC investments in our portfolio that we are bullish on – Angstrom Power and PolyFuel. I would say we have learned a lot about the general FC market and understand many of the technology challenges and market adoption risks much better. We are still interested in the FC space – I would just say we are a more sophisticated FC investor now.

What does Emerald see as the main differences between investing in cleantech in Europe versus the US?

The topic of an article in itself but quickly: Deal structure, Corporate governance model, Company history (many family business in Europe), labour laws, language, proximity and access to stock exchanges which are more accommodating to VC backed companies (Frankfurt Prime Standard, AIM), valuations (typically more favourable than the US – comparable to Canada where we are also very active). The short answer is lots but both regions provide great opportunity to generate investor returns. Again or investment thesis is based on the fact that unlike IT, cleantech is a global business and as such, investment opportunities are not limited to Silicon Valley or any other specific geography. At Emerald Technology Ventures we have taken a distinctive approach to addressing the challenges associated with technology specialization and geographic diversity. Our approach includes having technically competent people in-house and locating our Partners and Technology Specialists in two of the most important Cleantech markets in the world: North America and Europe.

We have done a lot of writing at Cleantech Blog on topics including ethanol, solar – so I’d like to get your 1 sentence rapid fire take on a couple of always topical cleantech investment debates:
- Thin film vs. Conventional PV - Thin film if you have deep pockets and patience
- Solar concentrators vs. Flat Panel - No comment, yet.
- Cellulosic vs. Corn Ethanol - Science project vs. commodity. I’m a VC…science project always wins.
- Cleantech vs. Greentech - Make great products, build great businesses and provide great returns to investors (and hopefully help out our world along the way) and no one will care what you call it.

Thanks Scott. Especially with those last comments, you've provided some good food for thought. The venture capital sector is built around high risk, high reward, and you guys are certainly in the mix. We continue to keep our fingers crossed that cleantech sector can deliver on the rewards side. You can find more on Emerald at www.emerald-ventures.com. And don't forget to visit GreenVest on June 25 in San Francisco.

Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog, a Contributing Author for Inside Greentech, and a Contributing Editor to Alt Energy Stocks.

Labels: cleantech, Cleantech Blog, energy, green, green tech, greentech, investment, private equity, Silicon Valley, venture capital

Wednesday, April 04, 2007

Which Way to the Sun? Where is Solar Headed?

I had a chance to talk with David Hochschild, the outgoing Executive Director of PV Now about his thoughts on the solar industry and recent changes. PVNow is an industry association that, among other things, helped lobby for the net metering and the solar initiative in California and increased RPS standards in Texas and New Jersey. David is a well-known advocate and speaker on solar issues.

David, can you give us a bit of background as to PV Now, and your role in the industry?

Sure. I co-founded Vote Solar in 2002 after working on the $100 M solar bond campaign in San Francisco. More info at http://www.votesolar.org/. For the last year, I have been Executive Director of PV Now, the consortium of major solar companies, working to promote pro-solar policy at the state level.

While PV is the only viable solution for small point of use electric generation, solar thermal is generally considered a hugely more economic solar solution at multi-megawatts scale than PV, but PV gets all the press in its drive to compete with the grid at large scale. Why is that? Understanding that your focus is PV, how would you like to see solar thermal fit in the solution set?

Am a huge fan of solar thermal and am getting a thermal system installed on my house this weekend, actually. I think PV gets more attention in California partly because we experienced an energy crisis that was really an electricity crisis and the blackouts were an electricity problem. But the contribution solar thermal can make is very real and very important and I think the passage of the ITC bill this year, if it happens, will do a great deal for solar thermal. States like Hawaii and countries like Israel already have a 30% market penetration for solar thermal and there’s no reason CA couldn’t as well. A little known fact – the country with the most solar thermal in the world is China. My personal view is that US should be leading in both PV and solar thermal and that if we can get the 8 year solar tax credit bill passed this year (HR 550), we will be in position to retake the lead.

It feels like there has been a changing of the guard in terms of the leaders in PV module production. What’s your take? Who would you rank as the up and comers?

I think China is emerging and we’ll see companies like Suntech really continue to grow rapidly. Older industry leaders, like BP, that used to dominate, are now sliding down the rankings of PV manufacturers. It’s also a good time for American solar manufacturers like SunPower and Evergreen, which are growing fast and are aided by the emergence of more state-based US PV markets like PA, TX, NJ, and AZ, in addition to CA.

And similarly on the integrator and installer side – what does the future hold? How do these companies best survive in a much more competitive environment?

I think there will be a major changing of the guard here too and things will get more sophisticated, which is long overdue. The installation cost of PV in Germany is about 30% less than the US so there is a lot of cost cutting to be found in installation. The savings are not just going to come from better manufacturing. Things like mountings systems, electronic shade analysis, snap-connects, better installation methods, customer energy calculators, reducing the # of site visits, all these factors bring down costs.

PV concentrators – I have long felt that concentrators are in a catch-22: if PV module costs don’t fall rapidly (as the industry works hard to drive them down), then the solar industry will struggle anyway, but if PV costs do fall as rapidly as expected – then why would the industry need concentrator technology whose primary advantage is reducing the amount of PV module? What’s your take?

If you are referring to technologies like Solaria’s – that take a concentrating lens and amplifly the amount of light on a PV panel – that will move forward and be important no matter what happens to the cost of PV because the lens will always be cheaper than silicon and the benefit you get from them is profound. I am optimistic about this sector in particular because, if they get it right, it could bring PV costs for conventional silicon technology down by 30% or more, fairly quickly. But there are still obstacles to be worked out such as heat gain and how you deal with that, which is a major issue in PV performance.

And where the rubber meets the road, do you have a PV system on your roof? If so, who did you buy it from, whose technology did you pick and why? If not, whose technology would you use?

I live in San Francisco by Dolores park and my wife and I have a 2kW system on our house that we installed in 2000. BP panels. If I were doing it today, I would opt for a higher efficiency panel such as SunPower.

After thinking about it a bit, I'd asked David to clarify a couple of his comments.

Can you elaborate a little on large solar thermal - like parabolic trough projects. I see little reason to do a large grid connected 5-10+ MW PV system, instead of a solar trough system. What are your thoughts on the competitive situation between PV and solar thermal trough power as PV tries to get to "grid scale"?

You’re absolutely right about CSP. I just visited the new CSP plant outside Las Vegas – 64 MW. And it is a superior technology for central station solar generation. No question. And that will only get better as newer synthetic oils come on to the market that can be heated to hotter temperatures than are currently possible (750 degrees is about the limit and that is a major constraint on how much power CSP can produce but this is likely to change soon). The federal ITC was the only reason that Nevada CSP plant got built so we can expect a lot more if the ITC gets extended.

I think the role that PV is best suited for is rooftop applications and there is so much available roofspace in this country, it’s ridiculous. So large scale PV is great, but in my view, it is best for rooftops rather than deserts.

Also, as to our discussion on changing of the guard, BP Solar among others has announced some major expansions.

Does this indicate that the "old guard" is likely to retake market share? It has been suggested to me that the some of the market share changes were related to silicon supply constraints that are now easing.

Regarding BP, yes they are making capacity expansions, but so is everyone. Nobody in this sector is NOT growing. The question is how fast they are growing. And I do think we are witnessing a major shakeup and many of the companies that were top market leaders over the last 5 years will not be over the next 5 years.

Myself, I tend to agree with David on this. While it is hard to pin down winners and losers, rapidly growing markets and changing competitive dynamics and cost curves do not make for stable market shares. It will be interesting to watch.

Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog, a Contributing Author for Inside Greentech, and a Contributing Editor to Alt Energy Stocks.

Labels: alternative energy, cleantech, Cleantech Blog, energy, federal policy, green, green tech, greentech, renewable energy, Silicon Valley, solar

Friday, March 16, 2007

Global Warming Solutions - Dell Style

Dell (Nasdaq:DELL), not known as a cleantech company, but long known for being a supply chain expert and direct marketing leader in PCs and electronic devices, is turning its attention to global warming - or at least working to provide consumers some greener product options and more consumer information.

Earlier this year, Dell announced its Plant a Tree For Me program. www.dell.com/plantatree

"LAS VEGAS, Jan. 9, 2007 — Michael Dell today announced a global carbon-neutral initiative that plants trees for customers to offset the carbon impact of electricity required to power their systems. The first of its kind program, announced at the Consumer Electronics Show here, underscores Dell’s commitment to continued broad environmental stewardship."

I had a chance to speak to one of their public relations specialists and get a little color.

The program is rolling out in stages (global roll-out is next). It launched in January to provide customers the option to buy offsets of kwh required to power computer systems. Dell is passing through all the payments a customer makes to its partners - Conservation Fund and CarbonFund.org. [Note: There are an increasing number of for profit and non profit entities like these two that will buy carbon offsets made in a variety of ways to sell to companies like Dell to "green up" products.] They are not yet attempting to calculate the emissions required to make a Dell product, just use.

I asked about assumptions in program. Basically they are offsetting 3 years of average power usage. "The donation amounts for ‘Plant a Tree for Me’ are based on expected average CO2 emissions from the production of electricity needed to power the systems over three years – for example, a notebook emits .42 tons and a desktop 1.26 tons. The cost of the carbon offset is $4.75 per ton. It costs approximately $6.31 per tree planted. On average a new tree will sequester 1.33 tons of CO2 over 70 years through the program.

The specific energy values are based on EPA estimates provided by the EPA and Lawrence Berkely Labs. Conversion of energy consumption values to CO2 equivalents is done per WRI/WBCSD standard protocol (world resources institute/world business council for sustainable development). The cost for the carbon offset is set by our partners at $4.75 per ton."

I asked why sinks? Why not energy efficiency credits or some other way of reducing carbon? Planting trees to create a carbon sink sometimes gets dinged for not being "permanent" enough of a reduction, e.g. if the forest burns down, all that carbon goes straight back into the air. But they tend to be the cheapest credits available. They didn't have especially insightful answers, but low cost and ease of availability probably play into it.

The reason for doing this?

Apparently Dell feels its customers are interested in greener products. However, while Dell says it is "encouraged by the response", they would not quote me any numbers of the level of uptake achieved or the targets they were hoping for.

In another area of note, Dell is rolling out an Energy Smart Program. through a wide range of product areas.

"Dell made significant progress during 2006 against its goal to deliver customers the most energy-efficient products in the industry. Since announcing the strategy and customer energy resource calculators at www.dell.com/energy in September 2006, we have rolled Energy Smart settings across the latest models of our OptiPlexTM desktop line to enable up to 70 percent system power savings for the OptiPlex 7451. We also recently introduced two PowerEdge products with Energy Smart settings with energy savings of up to 25% accompanied by performance enhancements that afford up to 3X increase in performance per watt over previous generations.

The desktop figures are based on an average unit cost of energy of $0.10/KWh and assume an Annual Usage Profiles of 1 hour max performance, 7 hours office productivity, 1 hour idle and 15 hours sleep state for 264 days a year; 24 hours sleep state for 101 days. The server values assume a 24/7 duty cycle."

At the same time, Dell is making available on their website a series of online calculators for energy efficiency, along with making the "energy consumption spec" for a wide range of products.

While the devil is always in the details on the assumptions used, I find it refreshing that Dell is putting this level of effort into providing consumer information on the green and energy impacts of its products - kind of like a restaurant providing us information. I am also refreshed to see Dell say that they are passing all the cost through, and are not taking a margin. While I am very excited about the potential to profitably market carbon credits to consumers, Dell's move tells me they view greening their products as a requirement to be in the business and a benchmark for product quality that they intend to meet, not just an extra option to add more margin to existing products.

I will be even more intrigued if Dell starts to publish or commit to customer uptake numbers on its carbon credit roll-out (like it would if I were an analyst asking for targets and uptake on units sold of a new product line).

And I will be elated if Dell starts to use its strenght in supply chain management to force the carbon credit suppliers into more transparency and standarization (a chronic problem in the market today).

Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog and a Contributing Editor to Alt Energy Stocks.

Labels: alternative energy, carbon, cleantech, Cleantech Blog, climate change, energy, green, green tech, greentech, sustainability

Wednesday, February 14, 2007

Green Fringe

by Heather Rae

Reading the New York Times Real Estate section is like pulling off the toenail of your little toe. In a world where the price of habitation climbs into the cool millions, this sweet torture leaves you bleeding and worrying for your sanity. You don’t really need the toe or the toenail, and they would have been better off left alone. And now you hurt.

Last week’s “Living Here” section of the paper was somewhat less torturous and kindled some hope in the desert – which is closer to the “here” in “living here” than the streets of New York City. It featured seven straw-bale houses. The hollow stalks of straw bales provide excellent insulation and are ideal for climates like those also ideally suited for second homes – Arizona, Colorado, Montana, New Mexico, Texas and British Columbia. Common features include passive solar, radiant heat, solar photovoltaics…and views. I imagine buyers of second homes do not wince reading New York Times Real Estate section.

Up the east coast, The Boston Globe Magazine ambled into “Your (Green) Home” with three articles on green residential construction (an outlandish earth-berm and two of the “oh-it-looks-normal” urban and suburban variety). A separate article on “earth-friendly, money-saving fixes from paints to appliances” (“Is it Worth It?”) is good, but nothing you wouldn’t find on any green builder supply or architectural website or in magazines like Natural Home. What’s most interesting about this issue of the mainstream Globe Magazine is the complete absence of advertising for the green products and services referenced in the articles.

This past week, This Old House sent a Sneak Preview of an article on their first-ever green renovation project. The energy-efficient lighting section is very good and the section on green products is great fun -- complete with links to product suppliers -- but if energy efficiency is the heart of green (and it is) then this particular old house renovation, however beautiful, has a weak heart. I need to see the heating and cooling specs.

I would have seen more of green, energy efficiency specs at an exhibit on green architecture at Bowdoin College – a mile away from my well-insulated rental in Maine – had I even known about it.

“Homes built to those standards are significantly more energy efficient than conventionally designed homes, according to MaineHousing Director Dale McCormick. ‘By making these designs available to the public, as well as homebuilders, architects, and contractors, we hope to encourage the development of more green housing in the state," McCormick said. "Green housing is not only more energy efficient, it is also environmentally friendly, compatible with its location, durable, and healthy for the occupants.’"

This past week, a colleague in the energy technology marketing field was at the NET2007 (New and Emerging Technologies) conference in Orlando, Florida. Orlando was also the site of the 2007 International Builder’s Show held last week. The National Association of Home Builders, a sponsor of the Builder's Show, posted a press release on its website two days ago, “Builders Embrace Green Building To Save Energy, Conserve Resources” My landlord is on the board of NAHB, so I go easy here. The highlight of the NHBA show, so my NET2007 mole tells me, was the Kohler exhibit where models showered in skin-colored bathing suits behind glass. That’s men standing around ogling. So, what else is new? From the displays at the show, its awards and the press release (despite its assertion to the contrary), not green building. The green building action was over at NET2007, not at the builder’s show where green building is as fringe pulling off a toenail.

Other goings on this week
Ellen Goodman’s, “No Change in Political Climate”in The Boston Globe: “On the day that the latest report on global warming was released, I went out and bought a light bulb. OK, an environmentally-friendly, compact fluorescent light bulb…it was either buying a light bulb or pulling the covers over my head…I would like to say we’re at a point where global warming is impossible to deny. Let’s just say the global warming deniers are on par with Holocaust deniers, though one denies the past and the other denies the present and future…I don’t expect that this report will set off some vast political uprising. The sorry fact is that the rising world thermometer hasn’t translated into political climate change in America.

“American University’s Matthew Nisbet is among those who see the importance of expanding the story beyond scientists. He is charting the reframing of climate change into a moral and religious issue – see the greening of the evangelicals – and into a corruption of science issue – see big oil – and an economic issue – see the newer, greener technologies.”

Heather Rae, a contributor to cleantechblog.com, manages a 'whole house' home performance program in Maine. In 2006, she built a biobus and drove it from Colorado to Maine. In 2007, she begins renovation of an 1880 farmhouse using building science and green building principles.

Labels: alternative energy, architecture, building, cleantech, Cleantech Blog, energy, green, green tech, greentech, renewable energy