Report from Manitoba

In early August, at the invitation of the Government of Canada, the Chicago Council on Global Affairs (CCGA) organized a delegation of about a dozen energy executives from the Midwest U.S. to visit Canada to explore energy and environmental issues of common interest to the center of North America.  From my prior participation on a CCGA task force in 2009, which produced a report on the benefits to the Midwest from proactively participating in shaping energy/climate policy, I was lucky enough to be invited by the CCGA to join the group traveling to Canada.

Our first stop in Canada was Manitoba, where we focused on some of the more notable activities being undertaken by Manitoba Hydro, the provincial electric utility. 

We convened at Manitoba Hydro’s headquarters building, Manitoba Hydro Place, a two-year old 22-story gem in downtown Winnipeg.  The winner of several architectural awards, Manitoba Hydro Place is on a path to LEED Platinum certification, the highest standard of energy efficiency excellence.  The office tower has a number of fascinating heating, cooling and humidification/dehumidification concepts applied throughout in very fundamental ways that enable such a large building to be fully climate-controlled with only occasional reliance on a relatively small geothermal heat pump system, resulting in per-square-foot energy consumption levels about 20% the norm for buildings of this type.  This is especially impressive given the harsh climate that the building must face, with hot summers peaking at nearly 100 degrees Fahrenheit (35 degrees Celsius) and annual lows down to -35 degrees (in Celsius or Fahrenheit, it’s about the same). 

For a province with such abundant low-cost hydroelectric resources, one might wonder why Manitoba Hydro would emphasize energy efficiency not only at its own facilities, but also through a sizable demand-side management program rolled out to its customers.  In our briefing with the Premier (provincial minister), the genial and very-well-informed Greg Selinger, the overall energy strategy was made explicit:  Manitoba would like to more fully develop and export its immense run-of-river hydroelectric potential to the U.S. to serve the renewable energy markets there.  (Note that Manitoba drains about 20% of all of the precipitation that falls on the North American continent.)

So that we could see how vast this potential is, and how environmentally benign run-of-river hydro energy can be, we subsequently flew via small Perimeter Air turboprop to the northern Manitoba outpost of Gillam about 400 miles above Winnipeg, where we toured the 1200 megawatt Kettle Generating Station

Crucially unlike the Hoover Dam near Las Vegas or the Three Gorges Dam in China, Kettle didn’t displace habitats or populations by creating a massive new lake where one never existed.  True, some land was flooded as a result of Kettle’s construction, but let me assure you that the terrain and topography that was lost in the process is by no means scarce:  hundreds of thousands of square miles of virtually indistinguishable unpopulated territory stretch up there for as far as the eye can see from an airplane.

At Kettle, we were informed by plant management that fish (primarily pickerel) seemed to be genuinely unaffected by the existence of the hydro facility.  Long ago, I was told a joke by power engineers that “fish-friendly-hydro” is as oxymoronic as “grass-friendly-lawnmowers”.  This is probably why hydroelectricity is often ineligible to be considered “renewable” for the purposes of complying with renewable portfolio standard policies that have been enacted in many U.S. states:  many environmentalists aren’t very keen on hydro.   However, I can attest to having seen an otter and a loon both swimming in the downstream wake of the Kettle dam in waters that looked pretty turbulent — and I can only suspect that they were there at least partially for feeding purposes.

Because it is clearly zero-emission and involves a renewable resource (precipitation), and because it doesn’t cause sizable apparent negative impacts on the regional environment, I don’t see significant problems associated with more run-of-river hydro development in northern Manitoba. 

Manitoba Hydro allowed us into places and spaces for better viewing that I’m sure would have caused any OSHA  representative to faint.  The sights at Kettle were impressive, though nothing particularly rare within the power industry:  all big hydro facilities are impressive.

Just down the (gravel) road, though, was something quite extraordinary:  the Radisson Converter Station.

Conventional power grids are alternating current (AC).  Hydroelectric dams produce AC electricity.  However, shipping power across hundreds of miles of desolate landscape over AC lines is inefficient:  capital costs and losses are high, rights-of-way are wide.  In contrast, long-distance transmission using high-voltage direct current (HVDC) is much more economically-attractive on a per-mile basis.

There’s just one challenge:  converting thousands of megawatts of AC power at high-voltage to HVDC is not so easy, nor is it cheap.

Radisson is one of the largest and oldest HVDC converter stations in the world.  For as long as Kettle has been in place, Radisson has been taking its output, converting it into HVDC, and then sending it down a 400 mile set of 450 kv HVDC lines, to be reconverted into AC at a similar station (called Dorsey) in suburban Winnipeg.  Something of the magnitude of Radisson is very rare indeed.

Surrounded by switchgear and transformers akin to those found at any major substation on the power grid, a large warehouse-like building houses several sets of immense converter valves known as thyristors.  The heart of the operation, these thyristors are like transistors on steroids, chattering continuously like enormous jackhammers.  

The side-trip from Winnipeg to Gillam illustrated the basic conundrum that Manitoba faces:  all this excellent hydro resource, but it’s a thousand miles from the nearest underserved large load centers in the U.S.  While it’s relatively easy for Manitoba to increase its transmission capacity — the province can essentially assert control of rights-of-way, and population effects are minimal — getting the needed transmission expansions in the U.S. is oh-so-difficult, time-consuming and hence expensive. 

No doubt, the purpose of our visit to Manitoba was to build goodwill and generate more support as/if transmission expansion in the northern Midwest U.S. occurs to facilitate more movement of hydropower from Manitoba into the U.S.  From my standpoint, I’m in — but I also know that I alone (and my fellow travelers) will not have much incremental impact in aiding new transmission capacity to come on-line.

After about 28 whirlwind hours in Manitoba, our next stop on the Canadian tour was Alberta.  This will be the subject of a future posting, as there is even more of interest to the cleantech community to report from there.

The Winter of Nuclear Energy

On March 11, 2011, an earthquake then tsunami triggered escaping radiation from nuclear reactors near millions of people in Japan.

On Sunday, August 7, a group of the world’s greatest musicians performed an inspiring benefit concert to support disaster relief in Japan. Crosby, Stills & Nash, Jackson Browne, Bonnie Raitt, Jason Mraz, The Doobie Brothers, Tom Morello, John Hall, Kitaro, Jonathan Wilson,  and Sweet Honey in the Rock sang on behalf of  Musicians United for Safe Energy (MUSE). Music video links and breaking news are available at NukeFree.Org.

I was mesmerized by the music, the soaring harmonies of veteran cosmic rockers and new voices, and a dazzling performance powered with little grid energy. The Shoreline Amphitheatre concert stage was powered by an integrated system of SunPower solar PV in mobile SunPod modules, biodiesel gensets, mobile batteries, and WindTronics wind turbines. The energy-saving GRNLite LED lighting rig for the show has been donated by Bandit Lites, and Schubert Systems has donated the sound rig.

“The disaster in Fukushima is not only a disaster for Japan. It is a global disaster. We come together now across cultural boundaries, political and generational boundaries, to call for changes in the way we use energy, and in the ways we conduct the search for solutions to the problems facing humanity,” says Jackson Browne. “We join with the people of Japan, and people everywhere who believe in a non-nuclear future.”

It was shortly after the March 2011 earthquake and tsunami that triggered multiple meltdowns at the Fukushima Daiichi nuclear plant in Japan that the decision was made by MUSE to coordinate the benefit. We have all read the news about the radiation in Japanese drinking water, food, and children exposed in radiation contaminated schools (New York Times Article).  When these great artists meet press members including me before the concert, Bonnie Raitt said, “We all live downwind.”

These musicians are committed to making a difference. Graham Nash uses solar power. As a father of three he told me of his compassion for all of our children. Speaking of nuclear industry executives he asked, “How can they do this. They’ve got their own children.”

“This is another massive world energy disaster from which there will be long-term effects,” adds Jason Mraz. “I am thrilled to be a part of this amazing show that will not only help those in Japan, but that will also call attention to the urgent need to embrace safe, clean energy alternatives.” Jason lives only 20 miles downwind from the aging San Onofre reactors built on an earthquake fault. Jason uses solar power and even had a solar party to educate his neighbors including my 86-year old friend Vera who now uses solar.

For over 25 years, Jackson Browne has lived off-grid using solar and wind power. He even rides on sunlight, charging his Chevy Volt with his renewable energy.

Major Nations Phase Out Nuclear

Germany makes it the age of renewables and will be ending its use of nuclear power in 10 years. By 2022, the last German nuclear power plant will be closed down. After the disaster in Japan, Germany has already permanently closed 7 nuclear plants. Germany’s world leadership in energy efficiency, wind power, and solar power, make the end of nuclear by 2022 feasible.

Italy is also no nukes due to a referendum where 90 percent of Italian voters called for the end of nuclear power. Italy is also showing strong leadership in solar power.

Reuters reports: “Japan, the world’s third-biggest nuclear power user, has only 16 of its 54 reactors on line, supplying less than a third of the total commercial nuclear generating capacity of 48,960 megawatts. The share of nuclear power in Japan’s power supply tumbled to about 18 percent in June from about 30 percent before the disasters struck.” Upgrading buildings and homes in Japan to LED and other energy efficient lighting would eliminate the need for those 16 reactors.

Most problematic in Japan are nuclear plants that are over 30 years old. Such dangers should give us pause in the United States where over 100 plants were built pre-1977 with 40-year target lives. 59 of those plants have had their licenses extended to 60 years. The nuclear industry has campaigned to stretch these to 80-year licenses.  In almost all cases, like Japan, the spent rods are stored onsite in U.S. plants. Some U.S. reactors are located near major earthquake faults.

The new generation of reactors are designed to be safer. Unlike wind and solar, nuclear provides electricity 24/7. Contrary to a common perception, nuclear is not as clean as renewable energy. The nuclear industry admits that the lifecycle greenhouse emissions from a nuclear plant are roughly equal to a natural gas plant, due to building with cement, mining, and spent fuel management. Promising innovation is occurring in small nuclear reactors, waste processing and the perpetual dream of fusion. But the industry constantly fails to meet commitments of being safe and cost-effective without government subsidy. Perhaps the greatest obstacle to new nukes in the U.S. is that financing requires taxpayer guarantees, taxpayers to insure the plants, and taxpayers on the line for future disasters.

It is no wonder that many Europeans have insisted on the phase-out of nuclear power after Chernobyl radiation spread to Europe, contaminating food and water. The cancer deaths from radiation exposure haunt people, as do child birth defects.

From my childhood, I remember when the Cuban Missile Crisis brought the United States and Russia to the brink of nuclear war.  Students were drilled to duck under our desks in the event on an atomic bomb. Neighbors built bomb shelters. We lived in fear. The threat still exists today as we watch the tension between North and South Korea, between Pakistan and India, and the threat of Nuclear Terrorism. The mideast worries that Iran’s nuclear ambitions go beyond generating electricity. If they do, another defiicit-financed war in the mideast will be the least of our problems.

Coal is the Other Unsafe Fuel

It would be tragic, however, if the phase-out of nuclear power lead to an increase of coal power. More people die each year from coal-power related lung cancer, asthma, and heart attacks, than die from nuclear plant radiation. Coal power plants emit mercury, sulfur dioxide, nitrogen oxides, and carbon dioxide.

Even worse is the methane escape from blowing-up mountain tops to feed our hunger for coal. Basic chemistry informs us that methane and CO2 accumulate in our atmosphere trapping heat. Climate models show that increased heat is threatening our food, our water, and our future. My 87-year old mother has been evacuated twice in recent years from wildfires that followed record draughts.

Although many in the fossil fuel industry now work behind the scenes to shutdown the EPA, or at least reduce their budget to make them ineffective, we actually need the EPA to increase its vigilance in protecting our health and future.

Fortunately, when new power plants are built, coal is rarely cost-effective in comparison to efficient natural gas power plants. In some parts of the world, coal cannot compete with renewable energy such as hydropower and wind power.

Safe Energy Meets All of Our Energy Needs

The good news is that we are moving to an energy future that is brighter and safer. Nations are moving from last century’s model of energy waste and unused capacity to this century’s model of energy efficiency and renewable energy.

In the United States, only about 52 percent of our generation capacity is used on average. We have build an ancient power system designed for all the air conditioners to run on the hottest afternoon in August. Now that smart grid technology including smart meters are being installed by the millions, utilities can deliver the right price signals and charge more when energy demand strains the system, and less energy is plentiful. Using software based intelligent energy management, corporations can run processes at the most cost effective time and we can wash our clothes at times when we can save money.

Energy efficiency (EE) is also lowering our need for coal and nuclear power. LEED buildings use of fraction of the energy of our worst structures. The new LED lights that shine over me as I write to you use 5 times less energy than the incandescent bulbs I formerly used.

The cleanest solutions to global warming, air pollution and energy security are wind, water, and solar power (WWS).  As Dr. Mark Jacobson walks me through the numbers of his, Dr. Mark Delucchi, and their teams’ multi-year study, the renewable energy solution stands out as the clear winner. Dr. Jacobson is a Professor of Civil and Environmental Engineering at Stanford University and an advisor to the U.S. Department of Energy.

Wind power has been doubling in capacity about every three years. It’s now over 200 GW; in 3 years it will be over 400 GW. 36 U.S. states generate enough wind power to replace one or more coal or nuclear power plants.  U.S. wind grew 39 percent in recession year 2009. In a growing number of global locations from Hawaii to Denmark, wind is the least expensive way to generate power. Their WWS study includes both on-shore wind power, which is plentiful from Texas through the Dakotas, and offshore with enormous potential along our Pacific and Atlantic coasts and our Great Lakes.

Solar includes the photovoltaics that cover homes and the faster growing PV that covers commercial roofs. It also includes the grid-scale PV and concentrating solar power (CSP) that generates the equivalent power of a natural gas or coal plant. The water in WWS includes hydropower, our most widely used source of renewable energy, and geothermal power, which uses steam to drive turbines.  Water also includes emerging, wave and tidal power generation. Brilliant minds, breakthrough innovation, and billions of investment in companies that deliver more cost-effective renewables and energy efficiency.

WWS can meet all of our needs for electricity. WWS can also meet all of our need for heat and for transportation. VantagePoint Capital Partners provide venture capital and management guidance to innovative leaders in energy innovation and efficiency, such as BrightSource, Better Place, and Goldwind.  VantagePoint was the presenting sponsor of the MUSE Concert.

Safer Energy and Economic Growth

During the next ten years, we will see major nations make their people safer by shutting down their last nuclear power plant. Due to the innovation and progress in energy efficient lights and buildings and thanks to the high growth of renewable energy their nations will better meet all their power needs.

Within the next three decades, all the of our global energy demands can be achieved with zero coal and nuclear power as we replace massive waste with intelligent energy management, replace darkness with energy-efficient lighting, and replace mercury and nuclear poisoning of our children with the power of the sun and the wind.

Cleantech Parasites

It dawned on me today, that after buying green ecommerce store 8 months ago, we put up links to the site on, and included special coupons for all our Cleantech Blog readers and members in the monthly emailings.  Here I thought people who were making a living off cleantech might *gasp* care about walking the walk and might appreciate it.

I think saw a total of 3 coupon downloads out of that, and two were spam.  Worse, I’ve gotten more than that many personal comments asking why I’d clutter up the cleantech site with blog columns about green products.  On Saturdays no less, when the weekend traffic falls off 75%.  For the record we pulled those columns a few months ago

Fine save your money or buy somewhere else, but that rate is so abysmally low, it made me wonder if the entire of my audience is completely hypocritic.  And yes, it’s the web.  And yes, I DO pay attention.   I can see what pages y’all click on, and where you comment, I moderate every single one. And several times a week I read every Yahoo, Facebook and LinkedIN comment, and systematically delete and block anyone I find that spams, no appeals.  When I ignore you, it’s because you’re being annoying, I mean err, “that comment does not meet our unpublished comment policy or is not conducive to the health of the and community”.

So I’m pretty sure this group likes to read and talk and b*%&h about cleantech and a greener better world.  But do you actually care?


Do you actually think about cleantech, green products, and energy or water use when you’re not at work?

How many of you actually have a solar system?

How many of your light bulbs are now CFLs or LEDs?

How many have done an energy audit?

What green/ecofriendly versions of a product have you actually bought?

Do you know what makes that product green?

Do you actually recycle/compost?  Do you do the minimum required, or make an extra effort? At your home?  At your office?  Do you even know?

Do you have a clue what your energy bill is?  How many kW hours you use per square foot?  How that compares to the average? – For the record, when I asked a number of people that question at the last Cleantech Forum, I got a bunch of very polite laughs.


Or, and please excuse the language, are you just a cleantech parasite sucking off the teat of the government subsidies in cleantech?  Warren Buffett literally eats the food from the restaurants he owns, right?  Do you even bother to turn your lights off? 😉  What’s the phrase?  Oh yeah, “the choice is yours”.

Safer than Nuclear – Renewable Energy, Natural Gas, Energy Efficiency

“In 88 minutes, the sun provides 470 exajoules of energy, as much energy as humanity consumes in a year.” In Scientific American, Ramez Naam adds, “In 112 hours – less than five days – it provides 36 zettajoules of energy – as much energy as is contained in all proven reserves of oil, coal, and natural gas on this planet.”

We have no shortage of energy. Fortunately, we are increasingly producing and delivering more renewable energy at lower cost. At the same time we are more efficient about using energy for everything from lighting, to buildings, to transportation. Most promising is the trend to make energy cheap when plentiful, more expensive at peak, and use intelligent energy management to level the use. The grid is starting to get smart.

With a smart grid and national network of high-voltage lines, solar and wind power that are intermittent in single locations become predictable sources of steady power with a smart super grid. Renewables such as hydro, bioenergy, geothermal are already used as base load. The most cost-effective way to meet most of our base load needs is with efficient combined-cycle natural gas power plants.

As nations around the world rethink their plans for nuclear energy, better alternatives are seen in energy efficiency, renewable energy, natural gas, smart grid, and intelligent energy management.

Workers in Japan are heroically risking their lives to prevent a Chernobyl-type disaster. Earthquake exposed cores are tenuously contained hour by hour. Onsite spent fuel rods are being prevented from melt down minute by minute. Most problematic are nuclear plants that are over 30 years old. In Germany, Chancellor Merkel has called for a temporary shutdown of all nuclear plants built before 1980.

Such dangers should give us pause in the United States where over 100 plants were built pre-1977 with 40-year target lives. 59 of those plants have had their licenses extended to 60 years. The nuclear industry has campaigned to stretch these to 80-year licenses.  In almost all cases, like Japan, the spent rods are stored onsite in U.S. plants. Some U.S. reactors are located near major earthquake faults.

Fortunately, we have safer and more cost-effective energy solutions. The new Clean Energy Trends 2011 highlights strong growth in energy efficiency (including solar hot water), renewable energy, and innovative integration of natural gas and CSP. The report documents rapid progress: “The global market for solar photovoltaics (PV) has expanded from just $2.5 billion in 2000 to $71.2 billion in 2010, for example, representing a compound annual growth rate (CAGR) of 39.8 percent. The global market for wind power, which like solar PV we have tracked every year for the past decade, has similarly expanded from a global market worth $4.5 billion in 2000 to more than $60.5 billion today, for a CAGR of 29.7 percent.” Clean Edge research projects wind power to expand from $60.5 billion in 2010 to $122.9 billion by 2020, and solar to expand from $71.2 billion to $113.6 billion by 2020. Clean Trends 2011 also looks at innovative combination of cost-effect base load power and renewables:

The integration of natural gas and renewable energy offers an opportunity to transition smoothly away from dirty energy sources. One key trend in pairing natural gas with renewables has been the development of solar-gas hybrid systems, such as Florida Power & Light’s Martin Next Generation Solar Energy Center, which recently connected a 75 MW, concentrated solar power (CSP) plant to the largest natural gas plant in the U.S. (3.8 GW). Other hybrid plants in development include an NV Energy project in Nevada and two separate projects in California led by Inland Energy. Along with tackling renewables’ intermittency issues, hybrid plants are an enticing idea because the sharing of existing infrastructure, such as turbines and transmission lines, promises to reduce upfront capital costs. Integrated solar combined cycle (ISCC) plants, which increase steam generation by adding solar heat to gas-turbine waste heat, are another example of the mixing of solar and gas.

The best solution of all is to encourage people to save money by being more energy efficient. By making energy cheap off-peak and more pricey during peak hours, consumers know when to run their energy-efficient appliances, and industry knows how to optimize electricity demand.

Twenty-seven percent of all global electricity is consumed by lighting. I write this article sitting underneath new LED light bulbs that use one-tenth the energy of the old fashioned incandescent bulbs that came with the home when we bought it three years ago. As I finish the article, no lighting is needed. Sunlight streams in to welcome a bright day and a brighter future.

Matthew J. Schiltz Named Group CEO; Powerit Receives $5 Million in Funding from Investors

Media Contact:
Sarah Grolnic-McClurg
Thinkshift Communications/Pounce PR

(SEATTLE, March 1, 2011) Powerit Solutions, an international cleantech company that plugs energy-intensive businesses into the smart grid, today announced two actions that will fuel the firm’s continued growth and development. 

Effective March 7, 2011, Matthew J. Schiltz, a seasoned chief executive, will serve as group CEO of Powerit Solutions. He will lead Powerit’s international operations and take a seat on the company’s board. Concurrent with his arrival, the firm has secured an additional $5 million round of investor funding.

“Sometimes the stars really do align,” says Claes Olsson, chairman of the Powerit Solutions board of directors. “This fresh infusion of capital, coupled with Matt’s hiring, will launch a new era. We have ambitious plans under way on several fronts, and now we have bolstered our resources and leadership expertise, better preparing us to enter into new partnerships and channels and move even more deeply into the industrial and commercial energy management sectors.”

Matthew “Matt” Schiltz to Serve as Group CEO

Schiltz has served as president and CEO or COO for five highly successful technology companies since 1989. His track record in building high-growth technology companies encompasses all aspects of leading, building, growing, funding, and managing. His leadership helped each of his past five companies earn a spot on the Inc. 500 and/or Fast 50 lists due to their explosive growth. At Powerit Solutions, Schiltz will take the company’s proven technology and traction to scale.

Says Schiltz about his new position, “I’m excited to be leading Powerit Solutions—a dynamic, growing cleantech firm that is well out of the gate. Powerit’s proven energy management technology is producing terrific results for customers and the company has clear momentum. Armed with a leading solution in the growing smart grid sector, Powerit is very well positioned and we see great potential for accelerating growth even further.”

Most recently, Schiltz was president and CEO of DocuSign. Recruited by the board in 2007, he transformed the start-up into a market leader in electronic signatures. He closed three rounds of financing that totaled over $25 million, ran strategic business development relationships with leading corporations like Microsoft and, and grew shareholder value by more than 900 percent.

New Round of Financing Brings Fresh Capital

Powerit Solutions has also just completed a new round of financing with a $5 million investment from five funds. Black Coral Capital, a fund focused on the cleantech sector, led the round as a new investor; the other four were existing investors from prior rounds.

The investment will finance Powerit’s plans to scale these initiatives:

•Extend the company’s reach in key vertical manufacturing sectors with its Spara energy management technology.
•Develop partnerships with OEMs and energy services firms that want to use Spara technology to connect their customers to the smart grid.
•Add channel partners in North America and internationally.

“Powerit Solutions’ Spara technology is a valuable tool for smart grid connectivity, as we see in their work with Auto-DR, for example,” says Rob Day of Black Coral Capital. “Unlike a lot of smart grid companies that just have good ideas, Powerit’s ideas have become products that are already producing real benefits from the smart grid—customers are reducing their electricity bills and increasing operational efficiency.”

“Powerit is an established leader in energy management, with active installations operating around the world,” Day continues. “And we think Spara’s flexible technology will integrate well with partner services and products. That will help build Powerit’s value.”

About Black Coral Capital
Black Coral Capital is a fund investing in the alternative energy/cleantech space. It invests in a wide variety of cleantech arenas, both directly and through funds. Black Coral was formed in late 2008 and is building its presence in North America, with offices in New York, Boston, and Montreal. For more information, visit the Black Coral Capital website.

About Powerit Solutions
Powerit Solutions is a Seattle-based international cleantech company that plugs energy-intensive businesses into the smart grid. Powerit’s Spara technology enables users to automatically increase energy efficiency, cut peak-rate usage, participate in demand response programs, and respond to dynamic pricing advantageously—without compromising quality, production, or comfort. For more information, visit the Powerit Solutions website.

$100,000 Cleantech Shipping Grant Competition

WWL is one of the cleanest shipping companies and each year, offers a grant to the best new clean-tech innovation.

We are hoping to raise as much awareness of this scheme as possible to attract some really high quality entries – the grant has been upped this year to $100,000 and last year’s winner has seen his idea (a concept to rival SkySails) being trialled on ships at the moment.

With just over a month to go until its 2011 Orcelle Grants application period closes, global shipping and logistics provider Wallenius Wilhelmsen Logistics asked naval architects Per Brinchman and Per Tunell to share their insights into what makes a winning clean-tech idea.

This year, WWL has expanded the eligibility criteria for the Orcelle Grants to include alternative energy sources and energy-efficient technologies with applications for 1) commercial shipping and 2) terminal operations, reflecting WWL’s research and development into the E/SOrcelle, a zero emissions concept vessel, and the Castor Green Terminal, a zero-emissions terminal and cargo processing centre.

Applications are being welcomed from across the world from individual inventors, entrepreneurs and technology developers and are available at All applications must be submitted by Monday March 21, 2011. Winners will be announced in April 2011.

WWL head of environment, Melanie Moore, speaks to Per Brinchman and Per Tunell:

More about Wallenius Wilhelmsen Logistics

Wallenius Wilhelmsen Logistics ( delivers innovative and sustainable global shipping and logistics solutions for manufacturers of cars, trucks, heavy equipment and specialized cargo. WWL has approximately 3,300 employees worldwide, and deploys around 60 modern eco-adapted vessels. The company has a strong environmental focus and is an industry leader in developing innovative solutions to reduce its operational impacts on the environment.

Gas Chamber

Recently, the U.S. Chamber of Commerce released its prescription for U.S. energy policy.

“Facing Our Energy Realities:  A Plan to Fuel Our Recovery” is a more balanced document than what I might have expected.  Given the Chamber’s ardent undercutting of all efforts to deal with climate change in a thoughtful manner during the last Congress — see, for instance, this Washington Post article from late 2009 profiling how Apple (NASDAQ: AAPL) decided to leave the Chamber due to its strident positions — I was prepared to title this post “Chamber of Horrors”, expecting the Chamber to call for continued status quo on energy, only perhaps a little better.

The outline of their recommendations is as follows:

I.  Maximize America’s Own Energy Resources:  Promote Energy Efficiency.  Produce More Domestic Energy.  Improve Access to Federal Lands.  Allow Development of New Resources.

II.  Make New and Clean Energy Technologies More Affordable:  Commit to Innovation.  Demonstrate New Technologies. 

III.  Eliminate Regulatory Barriers Derailing Energy Projects:  Create A Predictable Regulatory Environment.  Streamline, Not Weaken, Environmental Reviews.  Prioritize Siting and Permitting of Interstate Transmission.

IV.  Do Not Put America’s Existing Energy Sources Out of Business:  Ensure Adequate Supplies of Energy for a Smooth Transition. 

V.  Encourage Free and Fair Trade of Energy Technologies and Resources Globally:  Promote Free Trade.  Eliminate Trade Barriers.  End Discriminatory Content and Trade Policies. 

To be sure, the primary message of the Chamber in this pamphlet is “more”:  especially, more production of fossil fuel based energy from domestic sources.  And, to be sure, this stance is being greatly enabled by the recent promise of a surge in natural gas available by producing from heretofore uneconomic shale plays due to advancements in new drilling/extraction technologies.

I have nothing against producing more natural gas domestically, particularly if it can be economically used to displace more environmentally-damaging coal-based energy or strategically-damaging petroleum-based energy.  However, we can’t put all our eggs in the natural gas basket — if for no other reason than we’ll end up painted in a corner someday from over-reliance on gas, just as we’re painted in a corner now from over-reliance on coal and oil. 

I’m glad to see that the Chamber has made some room and recognition available for energy efficiency and renewables (e.g., by supporting the suggestion of a Clean Energy Bank) in its public platforms, but the Chamber is clearly full of gas.

In The Navy

by Richard T. Stuebi

At last week’s Clean Economy Summit in Washington, Navy Secretary Ray Mabus gave a stirring speech on how the Navy and Marines were committed to pushing ahead on new clean sources of energy to fuel their operations.  The energy goals of the Navy include the creation of a “Green Fleet” and the impressive target of 50% from domestic renewable energy supplies by 2020.

The goals are not just long-term, they are beginning to be implemented already.  Mabus told of the USS Makin Island that is using hybrid drive technology, employing battery power at low sailing speeds, that saved $2 million in fuel costs in its maiden voyage from its launch in Mississippi around South America to its base in San Diego.  “Over the lifetime of this ship,” Mabus continued, “we expect to save American taxpayers about a quarter-billion dollars.”

Mabus recited the daunting economic costs (estimated at $400/gallon all-in for gasoline at the frontline in Afghanistan) and personnel costs (extra security forces and casualties associated with fuel convoys of high value to the enemy) of hauling petroleum products to forward military theatres of operation.  Then, he switched from the factual to the philosophic by asking a compelling rhetorical question:  “We would never allow our ships, planes and tanks to be made somewhere other than the U.S., but we’re OK with powering them by fuels from foreign sources?”

Notably, Mabus spoke on the very same day that the New York Times reported on a new and highly-critical study issued by the RAND Corporation entitled “Alternative Fuels for Military Applications”.  Mabus flatly refuted the negative RAND assessment, stating bluntly that RAND “didn’t talk to us, and therefore didn’t see what we were already able to do, today, with alternative fuels.” 

Being on the vanguard is not a new role for the Navy:  Mabus noted that the Navy has historically been the leader in ushering in energy technologies into the mainstream, being an early adopter of coal in the mid-1800s, of oil in the early 1900s, and of nuclear in the mid-1900s.

There were probably doubters back then, too.

Israel Awakening to Cleantech

by Richard T. Stuebi

In early November, I  participated in a week-long delegation concerning energy in Israel, at the invitation of Project Interchange, an educational program of the American Jewish Committee

In addition to learning a tremendous amount about Israel’s history, culture and political situation, my fellow travelers and I were fortunate to talk with many leaders active in various aspects of Israel’s cleantech sector.  From a cleantech standpoint, the key takeaways I gained from our tour were:

Even with a population of only 7 million people, Israel can nevertheless be an important force in cleantech, given that Jews have consistently played a disproportionately influential role in scientific and social advancement of the human race throughout history.

Predictions for cleantech in 2011

It’s December, and time for an annual reading of the green [tech industry] tea leaves. What will the new year have in store for cleantech?

From our standpoint at Kachan & Co., 2011 could be a strong year for the global clean technology sector. Seemingly, the markets have been correcting themselves in 2010; valuations are returning to rational P/E multiples, price signals are emerging again after massive government investment in cleantech, early stage deals seem to be returning, corporate investment is flowing, new funds are being announced everywhere. Outside the U.S., which is having an increasingly hard time supporting the sector, cleantech is alive and well, even in exits… albeit mostly in China.

While we’re calling a positive 2011 for the industry, the largest risk, to cleantech and every sector in 2011, will continue to be the spectre of another global economic slide: another massive economic “stair-step” downwards prompted by the continued and growing mismatch between global energy supply and demand, food supply and demand, ever-increasing debt and trade deficits, currency revaluation or political/military developments. Any one, or combination of these, could result in another 2008-scale financial crisis, or worse.

Yet, if none of the above make themselves felt, 2011 could be a solid year for worldwide cleantech. Here’s why, in our analysis.

Sustained worldwide VC investment in cleantech in 2011
Predictions of cleantech’s death, or bubble, are exaggerated, we believe. Kleiner Perkins may be looking to scale back its cleantech investing. But that doesn’t mean cleantech companies won’t be getting funded, or that the sector is on the downside of a bubble, as some have called it. The big drivers of cleantech remain: resource scarcity and the drive for greater efficiencies, the desire for energy independence, and (dare we say it?) climate change—the latter of which has taken a back seat of late. We predict these drivers—particularly the real or perceived scarcity around oil, rare earth elements and other commodities—will be felt even more acutely in 2011, especially as the Chinese middle class expands, further cementing the demand for and the market validity of clean technologies.

Much media attention was given to a downturn in cleantech investing in the third quarter of this year, in particular North America’s share of it. But doomsayers missed that there was still a fourth quarter in 2010 to report. And that worldwide, cleantech investment hasn’t fared that poorly in 2010. Indeed, as tracked below, 2010 venture investment in cleantech, even simply up to and including 3Q10, has already exceeded that of all of 2009.

Cleantech Investment 2010 YTD

Venture investment in cleantech in 2010, up to and including 3Q10, already exceeded that of all of 2009. The full 2010 total will be at least $1B higher when fully tallied and reported in 2011. That'll make it the second best year on record—hardly a bubble that's burst. Source: Cleantech Group

We believe venture investors will continue to chase opportunities in cleantech in 2011, investing robust amounts from record-level funds raised recently around the planet. Make no mistake: there’s plenty of capital being allocated for cleantech in 2011. Another $500 million has just been announced from the California Public Employees Retirement System (CalPERS). Hony Capital in China is closing in on a new 10 billion RMB ($1.5 billion) fund, and there’s a new €9b ($12.4b) NER300 fund for cleantech in the EU. And that’s just three of dozens announced in the last month.

Yes, there are concerns about exits and long time horizons in cleantech, but the sheer sizes of the addressable markets many cleantech companies target, and the possibilities for massive associated returns, will continue to draw investors to the sector.

Venture capital will continue to cede importance to corporate and non-institutional capital
As important as venture numbers are, they are no longer the single barometer of the state of worldwide cleantech investment. They don’t factor in most angel, project finance, private equity, sovereign and other sources of capital that are now making an impact in cleantech worldwide.

One of the most important sources to watch is corporate venture funding. Look for large companies to invest billions in cleantech in 2011. In recent weeks, Suez Environnement, affiliated with GDF Suez, created a venture capital fund called Blue Orange to invest primarily in waste management. GE invested $200 million+ in a handful of cleantech companies under the auspices of a competition. Corporations continue to form corporate venturing arms, driven not just by returns, but by associated corporate social responsibility (CSR) benefits.

Also anticipate an increase in corporate-led cleantech M&A activity in 2011, which reached record levels in 2010. Expect cash-laden firms to pick off even more leading technologies and concepts, as in recent transactions like Constellation buying CPower, and Sharp’s purchase of Recurrent Energy.

A return to early stage venture investments
We predict a return to early stage venture capital investing in cleantech in 2011. Already, in the last few months of 2010, data shows the pendulum has begun to swing back to early stage deals. In the third quarter of 2010, 46 percent of all cleantech deals worldwide were early stage deals, according to latest data.

Why? Investors are no longer piggybacking on U.S. government grants and loan guarantees, which had skewed investment into more mature cleantech companies. Government stimulus funds earmarked for cleantech by the U.S. and other countries globally are now largely allocated. In 2011, venture investment in cleantech will return to what it does best: seeking out emerging early stage technologies and teams that promise good multiples, and will be less influenced by governments putting large amounts of capital to work themselves. Funds are still being raised. And those funds will need to be invested.

Energy efficiency emerges as the clear rock star of cleantech
Yes, we have a broader definition of energy efficiency than others (see our cleantech taxonomy here). But efficiency—including smart grid, where we expect continued massive investment and corporate activity—really just got underway in 2010, so expect big things in 2011. To wit: GE’s huge announcements, investments and acquisitions in the third quarter of 2010. And just over a month ago, Russia unveiled a massive energy efficiency plan, given that the country apparently wastes as much energy in a year as the French economy consumes.

There were some calendar quarters in 2010 where more venture investment went into solar than efficiency, but in 2011, look for efficiency to become the clear dominant investment theme as investors continue to seek less capital intensive efficiency plays and eschew solar, where company valuations have been swinging wildly in 2010 from continued supply/demand and international subsidy havoc.

Anticipate a Darwinian winnowing of efficiency companies in 2011—partially because of concerns about differentiation, and partly because of the long sales cycles of utilities that are only starting to become appreciated to some startups. There will be failures in 2011 in certain advanced metering companies and other firms engaged in death-by-trials with utilities, and some winners among favorite brands like OPower, EnergyHub, Tendril, Silver Spring, eMeter, AlertMe, Energate. The deep-pocketed stand the best chance of surviving.

Biofuel investment could reach former highs
If economic growth continues in 2011, oil prices will rise, making renewables more cost competitive. And after several years of relatively inexpensive oil, we predict an upswing in biofuels investment in 2011, specifically, that will catch some unaware; investors still smarting from crop-based ethanol and biodiesel, cellulosic ethanol and algal oil disappointments may not see adrop-in biofuels revolution at hand.

The excitement will not be over cellulosic ethanol, which we saw disappear from headlines in 2010. Cellulosic ethanol may even disappear from investors’ portfolios altogether in 2011, if the U.S. EPA lowers its cellulosic ethanol mandates yet again. We believe the recent jump in the share price of Amyris (NASDAQ:AMRS) is representative of a larger awakening to the transportation, storage, energy balance and fungibility benefits of drop-in biofuels, i.e. chemically similar diesel, jet fuel, butanol, bio natural gas and others.

In biofuels in 2011, as elsewhere in cleantech, look for biology to trump chemistry. And for the likes of Amyris, Codexis (NADAQ:CDXS) and Gevo to make more commercial progress than cellulosic companies Range Fuels, Coskata and Mascoma.

Nuclear surprises, but not in U.S.
Expect to hear about more and more nuclear innovation in 2011, as the industry begins cautiously testing new science after decades of relative inactivity. However, don’t expect the U.S. to lead in either the science, the trials or the adoption: watch Asia, Europe and Canada as centers of innovation and where trials of new nuclear tech will be performed in 2011. Companies to watch include Thorenco (new reactor designs based on thorium fuel), Thorium One (thorium fuel for existing reactors, trials scheduled to start in existing reactors in 2011), Kurion (glass encasing of nuclear waste), General Fusion and others. Nuclear development will remain stalled in the U.S. in 2011 in regulatory and public opinion purgatory while the rest of the world passes it by.

Recycling and mining will attract more investment
Rising commodity prices have been quietly making the economics of recycling and recovery of trace materials more commercially viable. Silver almost tripled in price in 2010. Gold doubled. Companies that recover and reprocess materials, such as scrap metal, used lithium batteries or mining tailings, will be companies to watch in 2011. BacTech Mining (CVE:BM), Simbol Materials, Buss & Buss Spezialmetalle, DeMetai Technologies, MBA Polymers and GFL Waste & Recycling (which just got a$100m private equity infusion) are examples of companies that could benefit from commodity prices that will continue to rise in 2011. That’s barring a macro-economic downturn that, like everything else, whacks the price of commodities (gold bugs note: metals are not immune to market gyrations! Gold fell substantially in the 2008 global downturn).

Natural gas emerges to threaten solar and wind for utility renewable power generation
Renewable natural gas? Today it’s fossil-based. But what if chemically identical natural gas (not just messy syngas) could be made inexpensively from practically free feedstock? Such gas, if indistinguishable from petro-based natural gas, could be transported in existing pipelines and sold at a premium to industrial customers like power utilities anxious for a cheaper renewable source than solar and wind. And, if burned in existing IGCC / NGCC plants, such power could be baseload 24/7 renewable energy. Look for scientific innovation in natural gas in 2011, increased political support for it as a transitional “cleaner” fuel, a folding in of it into renewable energy standards and general cleantech industry buzz over it being an important new wagon to hitch to.

China becomes the most important market for cleantech: if you’re not selling in China, you won’t matter
Expect the leading cleantech IPOs of 2011 to continue to be on the Shenzhen and Hong Kong exchanges, as they were in 2010. Central government support of Chinese clean technology companies on Chinese exchanges will continue to give the country’s solar, wind and other vendors advantage in access to capital, growth and, therefore, ability to scale and conquer worldwide.

Kachan & Co. made a case this past August that China had assumed the worldwide leadership position as a cleantech market and supplier. This week, Ernst and Young asserted the same thing. So it’s time to underscore it again: if you’re not selling into China in 2011, you’re missing the biggest market for your clean technology product or service.

in 2011, the leadership of cleantech vendors and service providers will be determined by the extent of their traction in China. It’s the largest and the fastest growing market for clean technologies, and to ignore it out of concern for intellectual property or other costs of doing business will be to watch most of one’s addressable worldwide market disappear to competitors that willshoulder the costs of business in China.

We’d welcome rhetoric in 2011 being less about how countries could or should compete with China’s cleantech leadership, and more focus on how to simply get on with capitalizing on the commercial opportunity that Chinese growth represents. While there’s still a worldwide financial system to profit from.

[Reposted by permission from]

A former managing director of the Cleantech Group, Dallas Kachan is now managing partner of Kachan & Co., a cleantech research and advisory firm that does business worldwide from San Francisco, Toronto and Vancouver. Its staff have been covering, publishing about and helping propel clean technology since 2006. Kachan & Co. offers cleantech research reports, consulting and other services that help accelerate its clients’ success in clean technology. Details at

Cleantech Success Formula = EE + ROI + 0 Capex

Cleantech Growth for Energy Efficiency, Smart Grid, Distributed Solar

metro la rooftop1 300x217 Cleantech Growth for Energy Efficiency, Smart Grid, Distributed SolarBy John Addison (11/5/10)

Energy Efficiency with Fast ROI Voted Most Likely to Succeed

Venture capitalists, cleantech executives, and technology experts gathered this week for GreenBeat 2010, hosted by SSE Labs of Stanford University andVentureBeat.

John Doerr, Partner KPCB, is optimistic about cleantech. He is one of the most successful venture capitalists of all time, backing Google, Amazon, and my alma mater Sun Microsystems. He has made six new cleantech investments this year. KPCB cleantech investmentsinclude Silver Springs Networks, Amyris, Mascoma, Ausra, Bloom Energy, and Fisker Automotive with ambitions to surpass Tesla.

Mr. Doerr is enthusiastic about cleantech in California, where voters this Tuesday defeated proposition 23, effectively showing that 60 percent of voters favor California’s climate cap-and-trade program. The oil industry proposition threatened hundreds of cleantech companies and ultimately hundreds of thousands of future jobs.

Nationally, however, the voters sent a clear message that they want fiscal responsibility and an economy that creates jobs.  Projects that need billions in federal funds or billions in loan guarantees are likely to go nowhere including nuclear, so-called clean coal, and utility-scale solar.

Distributed Solar and Energy Efficiency

Solar experts from SunRun, Sungevity, and SolarBridge observe that business is growing rapidly for distributed solar, confirming our solar energy report that distributed solar will grow over 40 percent annually. Commercial rooftops can support 100 kW to 20 MW solar projects located where power is consumed. Distribution investment is minimized. In contrast, utility-scale solar in the desert is more expensive to site, according to the industry panel, requires major high-voltage line and distribution investment, and can face years of NIMBY opposition. All this adds cost, risk, and project finance difficulty. These same factors can allow local solar, more expensive per kWh, to compete against remote coal and natural gas. A cap-trade fee for carbon emissions provides added distributed solar advantage over fossil fuel plants.

Negawatts are cheaper than megawatts. The biggest opportunities are in helping commercial customers and consumers reduce their electricity and heating bills. The Empire State Building will save over $4 million per year through energy saving initiatives such as installing 6,500 dual pane windows from Serious Materials whose CEO, Kevin Surace, reports that he already has 400 employees and is adding jobs.

Optimal energy savings occurs where energy technology converges with information technology to manage everything in buildings and homes from HVAC to lighting. Energy savings of 10 and 20 percent were reported without asking people to change behavior. Customers want these savings without capital expenditure (capex). Innovative companies that provide solutions as services win. Even better is when they implement demand response solutions that make the customer money.

Smart Grid to Grow to Billions of Nodes

Smart grid technology will ultimately be used to manage billions of points of energy generation and consumption. The first payoff of smart grids is allowing electric utilities to be more efficient and avoid payroll costs of manual meter readers and technicians that turn-on home power. So far, the utilities are saving and the ratepayers are footing the bill for smart meters. Consumers are starting to benefit as they get information about where they are losing energy money. Bill Weihl, Green Energy Czar for Google reports a large number of users, with hundreds commenting about saving money.

The “killer app” for the smart grid may be electric cars. By charging cars off-peak, utilities will find a home for electricity generated in power plants that like to run 24/7. Consumers, using smart charging and friendly charging apps and net tools, will save with low time-of-use rates for nighttime charging instead of expensive trips to the gas station.

Ten cleantech start-ups presented to a panel of venture capitalists at GreenBeat 2010. The winner was Redwood Systems, an intelligent lighting provider. Redwood is already saving money for giant customers like Flour. Redwood provides LED lighting networked with sensors and software for monitoring, control, and automated lighting. The VCs liked that Redwood addressed the need for energy efficiency with a high ROI, low barriers of entry in the built environment, and no big capex decision by the customer.

Global Cleantech 100

by Richard T. Stuebi

This past week in New York, at its annual East Coast investor forum, the Cleantech Group released its 2010 Global Cleantech 100, profiling the private cleantech companies that a set of panelists thinks has the most promise for large long-term impact.

Some highlights from the list and the report:

  1. In the panel’s eyes, the most promising company is Silver Springs Networks, followed by Zipcar, Opower, Bridgelux, and BrightSource Energy. Of course, the panel isn’t infallible: one of the 2009 Cleantech 100, Imara, flamed out even before 2009 ended.
  2. Energy efficiency displaced solar as the subsegment of cleantech with the most firms on the list, with 15. Solar and biofuels each account for 14 companies on the list. As big and active as the segment is, only one company in wind energy made the list.
  3. The U.S. remains the dominant geographic region for cleantech (55), with California far and away the leading state (33), and no other state with more than 8 (Massachusetts). However, Asia-Pacific (especially China) is fast on the rise.
  4. VantagePoint is the venture firm with the most companies on the list (14), one more than Kleiner Perkins.
  5. Corporate strategic partners and investors are increasing their cleantech activities. Google (NASDAQ: GOOG), IBM (NYSE: IBM), Siemens (XETRA: SIE), PG&E (NYSE: PCG), Landis & Gyr (a large global private company that itself is on the Cleantech 100) and General Electric (NYSE: GE) are at the top of the heap in engaging with companies on the list.

Richard T. Stuebi is a founding principal of NorTech Energy Enterprise, the advanced energy initiative at NorTech, where he is on loan from The Cleveland Foundation as its Fellow of Energy and Environmental Advancement. He is also a Managing Director in charge of cleantech investment activities at Early Stage Partners, a Cleveland-based venture capital firm.

Efficiency, Meet Elasticity

by Richard T. Stuebi

I sometimes receive criticism for not sufficiently promoting energy efficiency as a means of reducing our reliance on fossil fuels. I don’t think that the criticism is justified – I do strongly support the pursuit of energy efficiency – but I am willing to admit that I spend more time and attention focusing on energy supply technologies.

This is for two reasons. One is that we can’t realistically shrink our way to zero energy requirements – or even close. Yes, we must stop wastage, but for continued human progress over the centuries to come, we will always need a substantial supply of energy, from more benign and everlasting sources than the fossil fuels we depend upon today.

Second, and more subtly, the adoption of energy efficient technologies often begets a perverse reaction from the market – increased energy consumption — due to the effect of the economic concept of income elasticity.

This concept is illustrated by a paper entitled “Solid-State Lighting: An Energy-Economics Perspective” by Dr. Jeff Tsao and colleagues at Sandia National Laboratories in the Journal of Physics D: Applied Physics, assessing the long-run implications of the adoption of more efficient lighting technologies. Their study indicates that, by 2030, LED lighting will be three times more efficient than fluorescent lights – but that customer demand for lighting (as measured in lumens) will increase by a factor of ten, meaning that electricity requirements to supply lighting demand would have to double, even with elimination of incandescents and replacement with LEDs.

Again, I support the transition to LEDs. It should be noted that LEDs have much less of a thermal footprint, so even if the paradoxical results suggested by Dr. Tsao et al come to pass, there may still be a substantial reduction in energy requirements associated with air conditioning as LEDs come to replace incandescent lights.

The moral of this story is that energy efficiency is not a panacea for our environmental challenges. It is easy for advocates of energy efficiency to overlook consumer behavior when considering the aggregate impacts of a new technology – and thereby may overstate the potential environmental benefits associated with energy efficiency innovations. As a result, the search for new and better energy supply approaches remains an imperative – even while more aggressively promoting more efficient energy consumption technologies.

Richard T. Stuebi is a founding principal of NorTech Energy Enterprise, the advanced energy initiative at NorTech, where he is on loan from The Cleveland Foundation as its Fellow of Energy and Environmental Advancement. He is also a Managing Director in charge of cleantech investment activities at Early Stage Partners, a Cleveland-based venture capital firm.

The Future’s So Bright, My Windows Wear Shades

by Richard T. Stuebi

“You can think of it as a building with sunglasses.”

So says Rao Mulpurri, CEO of Soladigm, as reported in this item by Michael Kanellos in GreenTech Media.

Soladigm is commercializing electrochromic windows, which lighten and darken in response to an electric current, which in turn can be controlled by a building energy management system. The thought is to significantly reduce air conditioning requirements by reducing the amount of solar heat that penetrates a building through windows on hot sunny days.

As noted in the article, electrochromic windows is not a new concept in itself, highlighting Sage Electrochromics‘ work over the past 20 years. With big-time venture capital backing (led by Khosla Ventures), Soladigm claims to have cracked the code on reducing costs and improving performance of the core technology. Time, and the market, will tell.

Also telling is how much money — a $4 million grant and a $40 million (presumably below-market interest) loan — that the state of Mississippi recently threw at Soladigm to locate their manfuacturing plant in the town of Olive Branch. States are increasingly playing a pseudo-VC game, placing bets on still-new companies to lure companies for their tax base — in Soladigm’s case, 300 new jobs are claimed for the Olive Branch facility.

I really question the wisdom and prudence of these public sector handouts to lure jobs, but for sure, it’s darn near impossible to attract a company to a geographic area unless the government pulls out the wallet in a big way. When leading the Ohio Department of Development, Lieutenant Governor Lee Fisher said several times at public events that company attraction has become an “arms race”. (Of note, Ohio has won Site Selection‘s Governor’s Cup for most company investment projects for four years running, so the state is maintaining a fair degree of competitiveness, notwithstanding any perceptions to the contrary.) You can’t blame the companies for taking the money that’s on offer from states. But, from a taxpayer standpoint, you gotta wonder.

Money like that is very blinding to an early-stage company like Soladigm. No wonder they’re wearing shades.

Richard T. Stuebi is a founding principal of NorTech Energy Enterprise, the advanced energy initiative at NorTech, where he is on loan from The Cleveland Foundation as its Fellow of Energy and Environmental Advancement. He is also a Managing Director in charge of cleantech investment activities at Early Stage Partners, a Cleveland-based venture capital firm.

An Audit That One Can Actually Like

by Richard T. Stuebi

The concept of an “audit” is something that is inherently, well, unsettling. The word itself implies that you might have done something wrong, and someone is coming to catch you and punish you. For sure, no-one wants to face the prospect of an IRS audit.

Of course, that’s not the sole or even main reason that I’ve never undertaken an energy audit for my house. It’s not an excuse, but an explanation to say that I’ve simply been too preoccupied with other matters to go through the effort of finding a qualified firm to perform an energy audit. And, frankly, I had no idea whether an audit would cost $100 (easily acceptable) or $1000 (too much!).

So, it was with a bit of relief actually that a firm called GreenStreet Solutions sent me a mailer offering an energy audit for $199. No longer burdened with finding a firm to do the work, and knowing that the price was one I could afford, I gave them a call to schedule a visit.

I was very pleased. A two-man team from GreenStreet came to my 1978-era house for a 3-hour tour (sing along: “a 3-hour tour”), and found some pretty interesting results. I wasn’t surprised to discover that certain of the walls and ceilings were underinsulated. However, I was shocked to see that the biggest source of thermal leakage was out of my basement, through the front stoop.

Armed with a host of data collected from the building envelope, thermal images from scanning, and my prior year’s gas and electric bills, the GreenStreet team went off to prepare an assessment . A couple weeks later, the lead analyst returned for an evening debrief with me and my wife, handing us a bound report summarizing the findings and suggesting measures to implement.

The results: at 50 Pascals of pressure, 5135 cubic feet of air per minute were leaking through the building shell of my home, relative to a target of 2299 for a reference home of comparable size. To combat this, GreenStreet proposed three packages of solutions — Bronze, Silver and Gold — to reduce the leaks. To my wife and me, the Silver package looked the best — the most bang for the buck — entailing $9738 of outlays to save an estimated $2288 annual heating costs (surprisingly, savings on air conditioning expenses are not calculated), for a projected average payback of 4.3 years.

In addition, GreenStreet provided a bag full of goodies to further help reduce energy. For instance, we were given a Kill-A-Watt meter to measure appliance consumption rates and phantom loads. Though I haven’t yet gone around the house to develop a list, it sounds like a pretty fun project some rainy afternoon.

Also, GreenStreet gave us a bunch of thermal insulating gaskets for outlets and light switches. I installed these the other day, and in removing the covers, it’s really amazing to see how much thermal leakage is likely to occur through these huge uninsulated gaps. Parents: installing these gaskets would be an excellent project to give to your teenager to undertake.

As for implementing the audit results, we were prepared to authorize a go-ahead — until the GreenStreet salesperson noted that a bill was winding its way through Congress to reimburse up to $8000 (with no ceiling on income levels) for weatherization efforts, and since the bill wouldn’t be retroactive, we would be better off waiting for the bill to pass (expected this summer). We thanked him for his divulging this important opportunity, and asked him to have GreenStreet call us when the bill passed.

He further noted that a bill was moving through the Ohio legislature to reimburse the $199 we paid for the energy audit too, and informed us that we would be notified if this were to pass as well.

I was really impressed with the audit by GreenStreet — very professional, and not pushy. The GreenStreet agent noted that their parent company was Vectren (NYSE: VVC) — a gas and electric utility based in Southern Indiana — which leads me to wonder if all energy audits should be performed by companies that have a corporate parent that is a utility possessing sufficient financial wherewithal and expertise on energy-related issues.

However, unless the utility has revenue/profit decoupling mechanisms in place, it’s clear in my mind that an audit can’t effectively be done by the local utility, who may be subject to conflicts of interest by threatening to cannibalizing their core business from reducing energy consumption.

In all respects, my wife and I actually enjoyed this audit, and recommend a similar type of audit for anyone who wants to make their personal contribution to the cleantech challenge.

Richard T. Stuebi is a founding principal of NorTech Energy Enterprise, the advanced energy initiative at NorTech, where he is on loan from The Cleveland Foundation as its Fellow of Energy and Environmental Advancement. He is also a Managing Director in charge of cleantech investment activities at Early Stage Partners, a Cleveland-based venture capital firm.

Meeting the Energy and Climate Challenge

Dr. Steven Chu, Secretary of Energy and co-winner of the Nobel Prize for Physics (1997) delivered this speech “Meeting the Energy and Climate Challenge” at Stanford University on March 7, 2010, where he was formerly a professor.

Dr. Chu called on the students and faculty to take part in a new Industrial Revolution. At the epicenter of Silicon Valley, Stanford has been at the heart of the Information Technology Revolution – a catalyst for innovators such as Intel, Cisco, and Google. “America has the opportunity to lead the world in a new industrial revolution,” he was quoted in the Stanford Report.

Humans are causing Global Warming

The Novel Laureate discussed the irrefutable case for anthropogenic climate change. “There is a mountain of climate data going back to 1860.” Climate deniers say that humans are not causing global warming; rather it is a variance of solar energy including sun spots. Dr. Chu presented a chart showing the long-term continued rise in the global surface temperature while the solar energy reaching the atmosphere followed a predictable 11-year cycle of 1366 and 1367 watts per square meter (W/m²).

CO2 concentration has increased 40% since the start of the first industrial revolution, including all GHG such as methane the equivalent increase has been 50%. Irrevocable effects are under way. The Earth must warm until a new equilibrium is reached in about 150 years due to time lags such as deeper ocean warming. Added temperature increase will result from the long life of greenhouse gases, such as CO2, and from increased emissions.

The effects of warming can be measured. Satellites can now measure with good precision the mass of the earth. Dr. Chu observed that the ice mass is decreasing quadratically in the Greenland and decreasing in the Antarctic.

He also pointed to potential tipping points. There are huge uncertainties with the risk of 3.5 to 6 degree temperature increases.

United States Innovation in Energy Efficiency, Renewables, and Transportation
“The U.S. innovation machine is the greatest in the world,” said Dr. Chu. “When given the right incentives, [it] will respond.” Energy efficiency and renewables present major opportunities.

The U.S. market share of photovoltaics peaked in 1996 at over 40 percent of global production;
it is now less than 10%. Asia has the lead in batteries. China is spending $9 billion a month on clean energy. For example, the State Grid is investing $44 billion by 2012 and $88B by 2020 in UHV transmission lines with transmission losses over 2,000 kilometers that are less than 5%. China is committed to produce 100GW of wind power by 2020.

The United States Recovery Act is making an $80 billion down payment on a clean energy economy to regain our global competitiveness and create U.S. jobs. Dr. Chu described how the United States could be the world’s innovative leader. The most immediate opportunity is in energy efficiency.

Since 1975, the electricity saved from energy efficient refrigerators with smaller compressors exceeds the total energy produced from wind and solar. Consumers respond to Energy Star ratings. We are expanding our energy efficiency standards to include buildings. In answering a question, Dr. Chu noted that energy efficiency can be extended beyond buildings to city blocks and cities themselves. The Energy Secretary got laughs from the students when he demonstrated how to adjust the sleep mode settings on their PCs and Macs.

Optimistic about Research Breakthroughs

There is good reason for optimism for renewable energy. The cost factor of wind power has decreased by a power of ten. Learning curves for photovoltaics has also declined by over a factor of ten. On a large roof, the installed solar cost is still around $4 per watt. If you get to $1.50 per watt installed, solar takes off without subsidy.

Because renewables are variable they benefit from local and grid storage, and from a smart grid. Pumped water storage is often 75% efficient; compressed air has the potential to be 60 percent efficient. The DOE has funded research for a variety of grid and vehicle battery chemistries.
Currently the United States is dependent on oil. Most proven reserves for oil majors such as Exxon, BP, Shell, are now off-shore. It will cost more to extract from tar sands and with more CO2 emissions.

Transportation is the hardest area to improve, mused Dr. Chu. Liquid petroleum fuels have excellent energy density. A Boeing 777 departs with 45% of its weight in jet fuel which has an energy density of 43 Mj/kg and 32 Mj/liter; a lithium battery, only .54 Mj/kg and 0.9 Mj/liter, yet batteries can compete in cars because of the efficiency of electric drive systems and learning curve improvements. We need an automotive battery pack for less than $10,000 with 5,000 deep discharges and 5X higher storage capacity, stated Dr. Chu.
We need breakthroughs. Much can from great research labs, such as Dr. Chu’s former Bell Labs. Scientific research for new breakthroughs will be encouraged with multiple programs:

Energy Frontier Research Centers = university sponsored scientific research for
innovative energy solutions.
Energy Innovation Hubs = multi-disciplinary,
highly collaborative teams working under one roof.
Advanced Research Projects
Agency – Energy (ARPA-E) = short term, high risk – high reward research

Energy Secretary Chu concluded with the first view of Earth from the Apollo 8 orbit of the lunar surface and with these two quotations:

“We came all this way to explore the moon and the most important thing is that
we discovered the Earth. – U.S. Astronaut Bill Anders (Dec 24, 1968)

“…We are now faced with the fact, my friends, that tomorrow is today. We are confronted with the fierce urgency of now. In this unfolding conundrum of life and history, there is such a thing as being too late.” – Dr. Martin Luther King (1967)

Video of Dr. Chu’s Speech at Stanford

John Addison publishes the Clean Fleet Report and speaks at conferences. He is the author of the new book – Save Gas, Save the Planet – now selling at Amazon and other booksellers.

Behave Yourself!

by Richard T. Stuebi

It’s axiomatic among the cleantech community that energy efficiency represents the cheapest/easiest way to address our energy and environmental challenges. Indeed, as illustrated by some analysis by McKinsey & Company, many energy efficiency measures actually have net negative costs to implement.

So, why is it so damned hard for customers to adopt energy efficiency technologies? Consider the recent article from the Wall Street Journal, profiling the challenges faced in Boulder, Colorado — one of the most environmentally-inclined communities in North America — in encouraging energy efficiency measures. The WSJ article spurred some navel-gazing among the green-conscious Boulder citizenry, as witnessed in this blog post.

One way of looking at this issue is that it is indeed hard to change people’s habits and behaviors, but that eventually people do change. Another way of looking at this issue is that people are economic animals: they do make changes, pretty quickly, like it or not, when something hits their wallets and pocketbooks.

In other words, it’s really pushing water uphill trying to encourage a shift to using less energy, when energy is so bloody cheap for most people. Unless/until energy becomes more expensive (taxes anyone?), the only way to spur many customers to use less energy is to change codes such that inefficient devices — whether they be lightbulbs, refrigerators, air conditioners, TVs or computers — can no longer be bought.

In the absence of price signals that strongly encourage behaviors to reduce energy consumption, restricting what customers can buy is the only brute-force method available that really works. And, as can be seen in our current political environment, many Americans don’t like being strong-armed by their government.

Richard T. Stuebi is a founding principal of the advanced energy initiative at NorTech, where he is on loan from The Cleveland Foundation as its Fellow of Energy and Environmental Advancement. He is also a Managing Director in charge of cleantech investment activities at Early Stage Partners, a Cleveland-based venture capital firm.

Investing our way out of the Recession

I recently ran across this blogpost from a man I really respect. He says, “However, Paulson acknowledged to NPR host Scott Simon, the “conundrum” is that to spur the economy, we now need to spend more and create more jobs. Paulson did not offer a solution to this impasse.

Indeed, this contradiction is now paralyzing the nation’s political life, as Americans are worried about both high unemployment and record deficits. The Obama Administration and Congress are now walking a tightrope between these anxieties.

Investment as Solution. The solution to this jobs vs. savings conundrum is to invest money now, into projects that when completed will help us individually and as a nation to save more.”

The blog post goes on to offer some recommendations and I would visit it here:

My recommendation is to focus only on the built environment. According to a Navigant study funded by the Energy Foundation, there are 15,000,000 Commercial buildings in the US. out of a total of 130,000,000 million structures. There has been huge movement in the non-recourse financing space since SunEdison pioneered financing for solar PV in 2003. Today Property Assessed Clean Energy (PACE) bonds and utility on-bill payment mechanisms can bring interest rates for non-recourse energy efficiency bonds down to below 8.5% over 20 years. Not bad!

Companies like Pulse Energy, SCI, and others have software/hardware solutions that for less than $15,000 per building to perform retro-commissioning/continuous commissioning solutions to save over 10% of total electricity used in the Commercial sector — or around 150 terawatt hours. Given the 80/20 rule you would focus your efforts on the 3,000,000 buildings that are the largest opportunities or $45B in investment. The savings from these 20% of buildings would exceed 100 terawatt-hours per year or $10B per year. With interest the customer pays an extra $1,000 per year and savings of over $3,000 per year.

Job creation occurs from this one cost effective technology alone is almost a half a million job years. Taking energy audits that have already been completed for deeper energy retrofits and giving them a non-recourse financing solutions gives you a 2-3X multiplier on this opportunity. Cost effective solar, demand response, ice storage, and other consumer technologies multiply this by another 3X. LBNL estimates that the opportunity is around $440B using today’s technology.

The job creation from the work is important but not really what we are after. Money that is freed up from the sleepy electricity industry is usually redeployed in much more value creating areas — new businesses, consumption, savings

The multiplication effect here is what we are after. The Carbon War Room has recently launched the Green Capital Global Challenge to go after this opportunity.

There are so many investment opportunities that do not need federal government financial support — simply some assistance on removing market barriers. Smells like an opportunity!

Jigar Shah
Founder of SunEdison
CEO of the Carbon War Room

Why isn’t there a Building Efficiency Trade Association

Is it time for a real trade association for the Building Efficiency industry?

I was thinking about this today. I have seen one that really does the job. For those of you that have been a part of the efficiency industry for a long time, you know that it is like a greyhound race. Companies running as fast as they can to realize the dream only to come up short on actually catching the rabbit. Energy Efficiency in the US alone is estimated to have $440B of potential by LBNL and over $3 Trillion when calculating the ultimate economic potential by 2030. As the costs of new electricity, water, and natural gas capacity continues to rise, saving electricity, water, and natural gas becomes a far more cost-effective option – important during a recession. The challenge is that from energy efficiency financing to building codes – there is no coherent industry voice.

That’s why we need a real trade organization. Yes, there’s the Alliance to Save Energy; American Council for an Energy Efficient Economy; US Green Building Council and many others. And, yes, these organizations have worked on standards, financing, and regulations that would help the industry.

All that’s well and good, but we need an organization willing to do the hard work in the industry to establish and prioritize efforts to tackle the biggest obstacles to our growth. This is not easily done by a non-profit – we need a trade association. Currently, there is no widely recognized leader for energy efficiency financing, standards, and other issues. Leaving this to non-profits will leave us in the slow lane. A pathway for incremental change and more stop/start efforts.

An industry-wide trade association dedicated to energy efficiency financing, building codes, and other important areas make sense.

Jigar Shah, CEO Carbon War Room, Founder of SunEdison

Impact of Energy Efficiency on the System

by Jigar Shah, Founder SunEdison and CEO of the Carbon War Room

I was looking at the new Homestar program on the Efficiency First website here:
To start, it would be an amazing effort on the part of the Federal government. This comes on the heels of a huge effort on the part of the government to weatherize homes across this country. As many of you who know me, this is right up my alley. The problem with this program is that Homestar doesn’t really fundamentally shift our priorities as a nation. Assuming there is $23B of money available over 2 years available, here are some options:
1) PACE – property tax financing. This money could be used as a first loss guarantee available to the first $230B of non-recourse financing by cities. This would NOT be a Federal loan guarantee. As many of you know I find the Federal loan guarantee generally allows banks to be lazy and cuts out small contractors that can’t afford to do the paperwork
2) Utility on bill payment mechanisms – with the threat of PACE above, you might finally see utilities offer this program in a large enough quantity to offset the need for new generation facilities period. The beauty of this method is that it protects utility profits with decoupling or other half measures that really do not scale fully. The utility can use this method to carefully roll out energy efficiency in the best interests of its shareholders. Physical equipment like ice storage: would be my first choice. It shift peak power to off-peak power and reduces overall air conditioning by making ice at night when it is cooler. This technology by itself could reduce demand charges for customers by over 30% while make the utility more profitable by smoothing out generation usage. In this case the $23B would be used as a 20% subsidy to be matched by 80% utility money for energy efficiency. The 20% would pay for the “utility profits” and usher in a new way of thinking.
The reason this is better than Homestar can be best summed up by the article below. When the utility sells less electricity, it needs to raise rates to cover its fixed costs. The Federal government would spend its $23B in energy efficiency only to see almost 50% of that be charged back to rate payers in bill increases . . not catalytic.

“It’s a balance,” said Mayco Villafana, FPL spokesman. “If you do too much energy efficiency, a la what the conservationists are asking for, you are going to increase electric rates. You are reducing consumption but you still have to pay for existing power plants, transmission lines plus any new

It’s a classic chicken-and-egg dilemma for the utility regulators. They’ve let the companies start charging customers for new nuclear power and natural
gas-powered generators based on the companies’ predictions that Florida needs to double it electricity capacity by 2050. But if conservation reduces demand, will existing customers be forced to pay more?

“How outrageous is that?” asked Kristin Jacobs, a Broward County commissioner and chairman of the county’s Climate Change Task Force. “We should just continue to stumble along in our wasteful excessive ways?”

You can find out more about Jigar Shah and how the Carbon War Room is fixing market failures to create Climate Wealth at