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Updated: 1 year 49 weeks ago

A123 Bankruptcy: The National Security Question

Fri, 12/14/2012 - 15:45

Chinese automotive equipment giant Wanxiang has already given up a lot in its $256.6 million winning bid to take over bankrupt U.S. battery maker A123. Not only has it said goodbye to A123’s U.S. government work, it has lost the remaining $120 million or so of a $249 million Department of Energy grant that’s helped build A123’s lithium-ion factories in Michigan -- plants that Wanxiang says it will keep open.

But political opponents of A123’s sale to a Chinese company are saying that may not be enough. Even A123’s commercial technology is inextricably linked back to its federally funded work with partners like DOE and the Department of Defense, they say. That could allow Wanxiang to develop military applications based on A123’s U.S.-funded technology, it is claimed -- and that’s enough reason to block the sale.

These are some of the issues facing the Committee on Foreign Investment in the U.S. The committee chaired by Treasury Secretary Tim Geithner is in charge of deciding just what parts of a proposed sale of A123’s assets and intellectual property might constitute a national security risk. This week, the group began a 45-day review of the sale, with a deadline of January 15, 2013 to make a decision.

Let the lobbying begin. Johnson Controls, which had wanted to acquire A123’s automotive assets out of bankruptcy for $125 million, but bowed out of the auction after a final bid of $251 million jointly with Japan’s NEC, has made it clear that it stands ready to buy A123 if the sale to Wanxiang is blocked.

The Strategic Materials Advisory Council, an industry group, said this week that dozens of members of Congress have weighed in against Wanxiang’s takeover. U.S. Rep. Bill Huizenga (R.-Mich.), representing the state with the most to gain or lose from the future of A123’s U.S.-based manufacturing, took to Facebook to call it a threat to national security and economic competitiveness.

Members of Congress have already been demanding investigations into A123 and key business partner Fisker Automotive, along with other DOE-backed companies that have gone under (Abound Solar, Beacon Power) in the wake of Solyndra’s bankruptcy. Of course, DOE has also given money to foreign companies to create U.S. jobs, with mixed success -- LG Chem, which took a $151 million DOE award for its Michigan factory that builds batteries for the Chevy Volt, furloughed 200 workers in September.

As for A123’s military work, it was sold to Illinois-based Navitas Systems for $2.25 million, ensuring that Wanxiang would not take over federal contracts for projects like portable power systems and unmanned vehicles. Wanxiang gets the remainder of the Waltham, Mass-based company’s assets, including its automotive business with customers like Fisker, General Motors, BMW, Tata Motors and Smith Electric Vehicles, and its grid storage business, with partners including AES Energy Storage, Sempra Energy and NSTAR.

Just how many of those customers will remain with A123 through its transition remains to be seen. GM, which has tapped A123 to build batteries for its Spark EV, has remained mum on whether it will continue to work with the company as it goes through bankruptcy. Fisker, which accounted for 26 percent of A123’s revenues at the time of its bankruptcy, is facing its own challenges.

On the grid-scale energy storage front, AES, which accounted for 24 percent of A123’s revenues at the time of its bankruptcy, last week announced a new battery partner, Mitsubishi-GS Yuasa, for a 20-megawatt lithium-ion energy storage project in Chile. AES Energy Storage President Chris Shelton said in an interview this week that the choice of a new partner wasn’t related to A123’s bankruptcy, and that AES envisions working with a post-reorganization A123, as well as many other battery partners in the future. He wouldn’t say whether or not A123 had competed for the latest bid.

Can the DOE Kick-Start Offshore Wind in the US?

Fri, 12/14/2012 - 14:30

While there are nearly four gigawatts of installed offshore wind capacity in Europe and China, the U.S. has no operational projects in the water, and its nine advanced-stage plans, representing 3,380 megawatts of potential capacity, face challenges, according to a new study on the industry by Navigant Consulting that was conducted for the U.S. Department of Energy (DOE).

To further drive U.S. offshore wind past those challenges and into commercial operation by 2017, the DOE awarded $28 million per year in Advanced Technology Demonstration funding for the next six years to seven projects that proved themselves with backing from DOE in 2011.

1. Baryonyx Corporation (Austin, Texas) will build three 6-megawatt direct-drive wind turbines in Texas’ Gulf of Mexico waters near Port Isabel to demonstrate an advanced jacket foundation design and integrate lessons learned from the oil and gas sector on hurricane-resistant design, building and safety.

2. Fishermen's Energy (Atlantic City) will build six direct-drive turbines three miles off the Atlantic City coast in New Jersey waters to demonstrate an advanced bottom-mounted foundation design and innovative installation procedures to mitigate potential environmental impacts. The company expects to be in commercial operation by 2015.

3. Lake Erie Energy Development Corporation (Cleveland, Ohio) will build nine 3-megawatt direct-drive wind turbines in Lake Erie, seven miles off Cleveland’s coast, to demonstrate "ice breaker" monopile foundations designed to reduce ice loading.

4. Principle Power (Seattle, Washington) will build five 6-megawatt direct-drive offshore wind turbines on semi-submersible floating foundations in deep water ten miles to fifteen miles off Coos Bay, Oregon to demonstrate how the semi-submersible foundations and turbines can be assembled in the water near the project site to reduce installation costs.

5. Statoil North America (NYSE:STO) (Stamford, Connecticut) will build four 3-megawatt wind turbines on floating spar buoy structures in the Gulf of Maine’s 460-foot deep waters off Boothbay Harbor to demonstrate the spar buoys and turbines can be assembled in harbor and towed to the project site to reduce installation costs.

6. The University of Maine (Orono, Maine) will build two 6-megawatt direct-drive turbines on floating concrete semi-submersible foundations near Monhegan Island to demonstrate potential cost-effective improvements in commercial-scale production of traditional steel foundations.

7. Dominion Virginia Power (NYSE:D) (Richmond, Virginia) will design, develop, and build two 6-megawatt direct-drive turbines off the coast of Virginia Beach to demonstrate innovative "twisted jacket" foundations that offer the strength of traditional jacket or space-frame structures but use substantially less steel.

Among the Navigant study’s key findings:

The State of the Industry

-The U.S. has 33 offshore wind projects lay in varying stages of development

-The average nameplate offshore wind turbine has grown to 3.94 megawatts, likely has a monopile substructure and will soon be likely to have direct-drive generator technology.

- Offshore wind is riskier, costlier, and harder to finance than land-based wind.

The Direction of Growth

- As offshore turbines grow bigger and more different from land-based turbines in all their systems, their costs will come down.

- U.S. offshore wind will need a fleet of dedicated vessels capable of installing and servicing the ever-bigger turbines in ever-deeper waters and upgraded ports that can handle the vessels and the turbines.

- Like renewables onshore, offshore wind will require new transmission.

- With better siting, new technologies and methods, and the right enhanced infrastructure, production will increase and costs will fall.

What Offshore Wind Needs

- U.S. offshore wind’s three biggest challenges: high costs, inadequate infrastructure, uncertain policy and regulation.

- Short-term policies should drive demand, including mandated long-term PPAs, RPSs with offshore wind carve-outs, directed ITCs/PTCs, directed low-interest loans and loan guarantees, accelerated depreciation, and feed-in tariffs.

- Longer-term policies should be aimed at growing infrastructure and transmission.

- Improved regulation would streamline siting and permitting.

Costs for a 500-Megawatt Reference Plant Installed in the Mid-Atlantic in 2018:

- Estimated capital cost of $3,040 million ($6,080/kW).

- Estimated operations and maintenance (O&M) cost of $68 million/year ($136/kW-year).

- Estimated 3,000 job-years and $584 million in local spending over the construction period.

- Estimated 313 local jobs and $21 million in local spending per year of operation.

By 2030, the Navigant study concluded, the U.S. offshore wind industry could support ~50,000 to ~350,000 FTEs and drive ~$10 billion to ~$70 billion (in 2011 dollars). Whether it will be the high number or the low number depends on the evolution of other sectors in the economy, especially the price of natural gas and the change in coal-based generation capacity. 

The Top Trends in Smart Grid Analytics

Fri, 12/14/2012 - 14:14

The tens of billions of dollars of smart grid technology being deployed across the world is going to create a huge amount of data -- and that means that building the tools to collect, understand and act on that data is going to be a billion-dollar-plus business in its own right.

In fact, the U.S. market for smart grid analytics is set to grow from about $322.5 million this year to $1.4 billion by 2020, according to GTM Research’s report released this week, The Soft Grid 2013-2020: Big Data & Utility Analytics for Smart Grid.

That’s a combined total of $8.2 billion over the next eight years expected to be spent on the hardware, software and technical and business expertise needed to bring the U.S. smart grid into the mainstream of IT and big data. Much of it is being forced on utilities struggling to manage the massive flood of data coming from smart meters and other grid devices being deployed in the millions across the country.

But there’s also plenty of money flowing from venture capital investors, corporate investors and government-industry partnerships into the next generation of big data intelligence for the smart grid. After all, one of the key goals of analytics is to discover insights that have previously been obscured by a lack of data, and then to devise ways to act on those insights to save energy and money -- or even create new markets and business models.

So what are the top trends for smart grid data analytics in 2013? We’ve been covering the soft grid in depth for some time now, but GTM Research’s new report lays out some key findings:

1) Unstructured data is a major challenge, and tools like Hadoop and NoSQL architectures -- and companies that know how to use them for the smart grid -- will find willing customers. Examples of smart grid companies leveraging Hadoop include home energy analysis and efficiency startup Opower, utility-to-home-energy-management startup Tendril and the cloud-based, home-thermostat-optimizing technology of EcoFactor, to name a few. Companies like Versant and AutoGrid are building smart grid applications on top of their unstructured data analytics software platforms built out of the latest developments from the telecommunications and finance IT sectors, for instance.

In the meantime, IT giants like Oracle, IBM, EMC and Microsoft are promising unstructured data-ready platforms using Hadoop, though they’re not known for using open-source tools. That could mean acquisitions -- Oracle just bought big-data startup DataRaker, and Teradata, which is working closely with partners like Southern California Edison and Itron on smart meter data management, bought big-data startup Aster Data in 2011. Expect that big players in business analytics like SAS, IBM and SAP, all of which have utility and energy customers, will be watching the field closely as well.

2) MDM is today’s challenge, but the grid at large is the future. GTM Research highlights the fact that meter data management (MDM) is and will remain the top big data priority for utilities next year. However, “In the next wave of innovation, transformer sensors, cap banks, voltage regulators, distributed PV solar panels, and other grid assets will gain the ability to communicate their status updates back to the utility,” the report states.

In other words, we’re talking about the Internet of Things, applied to everything that attaches to the utility side of the grid. Companies like General Electric, Siemens, ABB, Alstom and Schneider Electric are all in a position to leverage their existing base of “smart” devices in the field to capitalize on this opportunity, the report finds, though it also notes that most have been slow to do so.

But that’s starting to change. Last month, General Electric launched its “Industrial Internet” initiative meant to network and analyze data from devices ranging from jet engines to smart meters, and has rolled out a cloud-based smart grid deployment and analytics software-as-a-service package it’s hoping will gain interest with utilities, for example.

3) Integration will remain a core function. First, utilities have to get all of their existing data sets to fit together somehow. For the foreseeable future, that kind of complex integration task will remain the realm of masters in the field, like IBM, Infosys, Wipro, Capgemini and Accenture, the report found.

4) Companies we’ve never heard of may be leaders in short order. The report noted that a string of big-data startups, such as Cloudera, Hortonworks, Hadapt, Platfora, Karmasphere, Domo, and Sumo Logic, to name just a few, have received roughly a half-billion dollars in VC capital so far. Of course, smart grid may be far down the list of profitable industries that big-data startups are targeting -- but as we’ve seen, developments in industries like telecommunications and mobile devices for consumer markets eventually filter their way down to the utility industry as well. We should expect the same for big data.

5) Trust for the cloud and software-as-a-solution smart grid offering is growing, but at utility (i.e., slow) speed. GTM Research takes the example of Salesforce.com here to show that, for certain utility business processes like customer information software (CIS) and enterprise IT, turning to SaaS is an increasingly viable options for utilities. But utilities are slow-moving and regulation-bound entities, and that makes change slow coming for many.

Indeed, according to GTM Research’s survey of utility executives, only 20 percent of respondents were implementing SaaS for enterprise IT or CIS, although another quarter or so of respondents said they were evaluating or planning to move certain apps to a SaaS provider in the next two years. Still, about 35 percent of respondents said they aren’t planning any SaaS implementations.

Turning over energy pricing or grid operations functions to a third-party platform provider is even less popular, however. Only one in ten respondents said they’re doing that now, and about 45 percent of respondents said they have no plans on that front. In the main, the next big wave of customers for SaaS utility platforms is expected to be municipal and cooperative utilities, which don’t have investor-owned utilities’ preference for capital (i.e., self-owned) projects over service-based models.

Stion Wins $25M VC Round for CIGS PV

Fri, 12/14/2012 - 12:40

Despite the carnage in the thin film solar sector (see bankruptcies or fire sales of CIGS players MiaSole, Ascent, HelioVolt, AQT, Solyndra, Global Solar, etc.), Stion just closed on $25 million of an anticipated $55 million VC round, according to an SEC filing.   

Almost a year ago today, the firm closed on the biggest photovoltaic VC round of 2011 with $130 million in private equity, led by AVACO and Korean private equity funds. AVACO is a supplier of thin-film processing equipment. 

The most recent funding looks to have come from existing investors, which include Khosla Ventures, Taiwan Semiconductor, Lightspeed Venture Partners, Braemar Energy Ventures and General Catalyst Partners. Stion also just received $2 million from the DOE's Sunshot program.

In June of this year, Stion announced a 13.4 percent module efficiency for its commercial modules built at its Hattiesburg, Mississippi factory. The firm's 145-watt module had one of the highest efficiencies verified by NREL for a monolithically integrated CIGS module manufactured on a commercial production line, according to a release by the firm. Stion began commercial shipments from its Hattiesburg factory in the first quarter of 2012.

The firm has a tandem design in the works and has licensed its technology to Taiwanese foundry TSMC. Stion claims an 18.8 percent aperture efficiency for its prototype tandem modules.

In an earlier interview, Chet Farris, the CEO, had claimed:

  • The company's CIGS-based product will offer "silicon efficiency at thin film costs."
  • Stion has demonstrated 14.1 percent efficiency on full-size panels with its single-junction product.
  • Stion is currently producing 2-foot-by-5-foot panels at 120 watts to 130 watts for all solar sectors.
  • The firm has a roadmap to 15 percent efficiency and is sold out of short-term capacity.
  • Farris also claimed that Stion can get to market in "half the time and with one-tenth the money."

 

In May of this year, Stion sent out an email blast offering solar modules "for as low as $.75 per watt." Neither the email nor a subsequently contacted representative of the company disclosed the volumes available or the terms of the offer for modules at that price. Aaron Thurlow, then Stion's VP of West Coast Sales, did say that these were fully UL-compliant modules shipping from Stion's Hattiesburg, Mississippi factory.

As GTM Research Solar Analyst MJ Shiao has discussed in his thin film market analysis, thin film vendors have a small window of opportunity to be competitive -- but the firms have to get their factories running at capacity to realize the cost promise of the technology. 

In terms of volume, the only two players of note in thin film are First Solar (Nasdaq: FSLR) with massive amounts of cadmium telluride panels deployed and Solar Frontier shipping hundreds of megawatts of CIGS. A thin film startup has to prove performance and pricing on par with crystalline silicon and then make the leap to perceived bankability to be a viable supplier in today's challenging marketplace.

 

Mass. Imposes $24.8M Penalty on Utilities for Storm Response

Fri, 12/14/2012 - 12:00

Before Sandy, there was Irene. While the mid-Atlantic was largely spared during Irene, parts of southern New England were hit hard by the tropical storm and a subsequent October snowstorm in 2011.

After an investigation into the response to the two storms, the Massachusetts Department of Public Utilities imposed a $24.8 million penalty on the state’s utilities, with National Grid facing the steepest penalty of $18.7 million.

The DPU found “systematic failures” in National Grid’s preparation and response to both storms. NSTAR and Western Massachusetts Electric Company were also fined.

“The DPU understands that there will be many thousands of outages in bad storms like Tropical Storm Irene and the October snowstorm.  These will not be the last severe storms we see, and the public cannot expect that the utilities can prevent outages in events of this magnitude,” DPU Chair Ann Berwick said in a statement. “On the other hand, public safety will remain our absolutely highest priority, and we will not tolerate inadequate responses to local public safety officials. Additionally, in this day and age, we expect competent communications with towns and customers alike.”

All of the companies were faulted for not communicating with other response teams and towns as quickly as they should have. The DPU also said National Grid took too long to address downed wires and respond to priority facilities. The order also said that National Grid did not secure enough restoration crews before the storm.

Massachusetts is hardly alone. Senators in Maryland have urged the state’s regulators to fine Baltimore Gas & Electric and Pepco for the response to the summer storms of 2012, known as "derechos," which led to some outages that lasted as long as a week.

Andrew Cuomo, the governor of New York, has opened an investigation into the state’s utilities’ response to Hurricane Sandy. The Long Island Power Authority has already endured some of Cuomo’s wrath, even though the governor himself is responsible for appointing the members of the utility’s board.

The investigation in New York will look at preparation and response and will also review the regulatory structures that oversee the utilities.

Outages are inevitable in large storms, but as utilities make significant investment into cutting-edge technologies that can reduce outages, there will be more examples that indicate that there is a new way of doing things.

Data analytics that use information coming off of smart meters can help to map outages and deploy crews faster. Some utilities with just partial smart meter deployments saw advantages during Sandy. Other utilities are upgrading their entire outage management systems and fault location isolation and service restoration, which can significantly cut the duration outages.

Currently, it is the wait-and-see stage for the rulings after Superstorm Sandy, but with increasing numbers of storms, there will likely be increasing penalties for utilities that don’t make the necessary investments, not only in tree-trimming, but also in all of the different technologies that can help with an outage.

Shell, VCs Ante Up $26M for Solar That Beats Natural Gas

Thu, 12/13/2012 - 16:30

GlassPoint Solar just won $26 million in Round B financing from an impressive list of investors. GlassPoint’s Enclosed Trough Concentrating Solar Power (CSP) enhanced oil recovery (EOR) process attracted oil giant Royal Dutch Shell (NYSE:RDS.A) as well as RockPort Capital, Nth Power, and Chrysalix Energy Venture Capital.

GlassPoint’s 300 kilowatt Kern County 21Z solar EOR project is presently at work in partner Berry Petroleum's McKittrick, California field. Another 7 megawatt project is nearing completion in a Petroleum Development Oman field in the south of Oman.

“Played out” wells still hold a third or more of their potential in heavy oil that is not recoverable by conventional drilling and pumping methods. For decades, natural gas has been used to boil water into pressurized steam that, flooded into the well, can turn the oil more fluid so that pumping can keep it coming up.

In 1983, ARCO’s solar subsidiary used a one-megawatt solar power tower project to generate steam in its Taft, California, field. Though the concept proved feasible, it was not cost-effective and ARCO dropped the experiment.

BrightSource Energy (BSE)’s 29-megawatt pressurized steam solar power tower CSP technology is presently doing EOR in Chevron’s Coalinga oil field. According to BSE’s S-1 report, Chevron (NYSE:CVX) contracted for its solar EOR services at $27.8 million in 2008, and the project, which was initiated in 2011, has cost BSE $67.3 million.

But the project is essentially R&D, said BSE’s Keely Wachs, and paved the way for BSE’s landmark three-unit, 370-megawatt Ivanpah electricity generating facility scheduled to go on-line in California’s Mojave Desert next year.

The project’s purpose is to prove the BSE solar EOR system’s viability, said Chevron spokesperson Madonna Smith. Production is not even being tracked.

Areva’s Compact Linear Fresnel Reflector (CFLR) technology is also a candidate for a share of the solar EOR market, but to date has built only projects that augment steam production in conventional fossil electricity generating plants.

An EOR method’s rate and percentage of recovery from any well is reservoir-specific, explained GlassPoint CEO Rod MacGregor, but an oil company will keep pumping as long as the process renders the product economical.

MacGregor said studies show solar EOR is able to produce approximately 16 percent more oil from a well than natural gas because gas has a fuel cost. Even the historically low $3.50 to $4.00 per MMBTU current price detracts from the economic viability of production.

Solar, MacGregor said, has no fuel cost and its operational cost, approximately $0.35 per MMBTU, is essentially fixed for the life of the project.

Though solar pricing varies with insolation and natural gas pricing just varies, CSP can produce steam at rates competitive with natural gas, according to a 2011 Raymond James evaluation. It put solar EOR at $2.00 per million cubic feet equivalent in the Middle East to $4.00 per million cubic feet equivalent in California.

That is the range in which natural gas spot market prices have hovered, though there is little reason to think they will remain below $5.00 per million cubic feet much longer.

“All natural gas cogeneration and 100 percent solar fraction scenarios had the largest and nearly equal net present values of $12.54 billion and $12.55 billion, respectively,” according to a 2012 paper from Stanford researchers presented to the Society of Petroleum Engineers. The 100 percent solar scenarios are achievable, the Stanford researchers say, from CSP with storage.

Solar power tower technology seems to be winning favor away from the older and more proven parabolic trough technology GlassPoint uses because it is capable of getting its operating fluids to higher temperatures.

The very efficiencies that make power tower technology able to achieve the higher temperatures, MacGregor said, are why trough technology is better suited for EOR. Both a Ferrari and a Ford F150 pickup can pull a trailer, he said, but it is not economic to use the Ferrari.

GlassPoint’s technology is designed, MacGregor said, to handle dirty feed water and harsh low maintenance conditions in an oilfield. And GlassPoint’s facilities require less capital and less land because they do not have to achieve the high temperature.

With GlassPoint’s technology, aluminum parabolic trough mirrors on single-axis trackers are enclosed in agricultural glass houses. Because they have been in use for decades, there is no need to scale up a supply chain. And because the trough units are enclosed in rectangular buildings, they can be readily cleaned robotically.

There is some loss of solar power, about 8 percent, to reflection by the glass, transmission through the glass, soiling and shading, MacGregor said, but the mirror and fluid system requires less land and less maintenance and it can be built with materials that do not have to stand up to the harsh desert environment because it is protected by the glass house.

One recent research study predicted the global EOR market will be $16.3 billion in 2014. Over 40 percent of California’s century-old oil wells now require enhancement and that is expected to be 60 percent in the next few years. But the real market, MacGregor said, is the Middle East, where a “perfect EOR storm” is setting in.

With light crude in many Middle East fields largely played out, they will be turning to heavy oil soon, he said. And there is a shortage of natural gas. And there is plenty of sun.   

SolarCity Trading Up 50% on Day of IPO; Rive and Musk Comment

Thu, 12/13/2012 - 16:00

After a painful pricing process, SolarCity (Nasdaq:SCTY) is now a public company. The stock is currently trading late in the day at $12.00, up 50 percent. Pricing the deal at $8.00 per share looks smart now, one day in to a very long slog.

CEO Lyndon Rive said in a video interview on Bloomberg TV, "What matters is what the price is in four years, not what the price is today."

In their first post-IPO interview, Rive and Chairman Elon Musk spoke about SolarCity's stock pricing, the solar market, and weddings.

The pair was asked by Bloomberg TV about the initial IPO price: "Who screwed up here? Something went wrong when you target $13 to $15 and end up with $8. [...] Who was pushing for that valuation and didn't get it? Was it you guys or was it your bankers, led by Goldman Sachs?"

Musk said, "Where we arrived at the $13 to $15 was based on valuing the business on fundamentals," adding, "$13 to $15 is actually a deal -- we actually think it's worth more than that." 

Rive suggested that people confused SolarCity with solar manufacturing companies. He said "SolarCity has a totally different business model than any other solar company out there. The business model is not to sell equipment but to sell energy -- and we sell energy at a lower cost than what you can buy from the utility."

When asked if the company should have postponed the IPO until after the fiscal cliff matter in the new year, Tesla CEO and SolarCity Chairman Elon Musk said, "We debated that at length at the board. In fact, it was a close call as to whether we should remain private or go public."

The deciding factor according to Musk and Rive was that it was important for the firm to go public and allow investors the ability to look at the firm's execution and get comfortable with the business model. Musk took the "advice of institutional investors that we respect."

Musk said, "Think of it like a wedding: you're there, you're at the altar, you're ready to get married. It's not such an easy thing to, sort of -- let's just get married next month."

Rive added, "It starts raining -- let's cancel the wedding and re-assess it next month." 

Rive said that the goal is to be cash-flow positive by the end of 2013.

New Report: Utility Data Analytics Market to Hit $3.8 Billion Annually by 2020

Thu, 12/13/2012 - 15:00

GTM Research forecasts cumulative global spending on power utility data analytics to top $20 billion over the next nine years, with an annual spend of $3.8 billion globally by 2020. GTM’s latest report, The Soft Grid 2013-2020: Big Data & Utility Analytics for Smart Grid, forecasts grid operations analytics will see the most significant investment, with consumer analytics as the second largest area. The report forecasts U.S. utilities alone will spend nearly $100 per home in grid operations and consumer-related analytics over the next nine years.

FIGURE: Global Utility Analytics Spending, 2012-2020


Source: The Soft Grid 2013-2020: Big Data & Utility Analytics for Smart Grid

This 133-page report from GTM Research is the first of its kind to take a competitive look at power utility data analytics, the smart grid’s next big growth market. With smart meters and distribution sensors beginning to populate “big data” from every corner of their territories, utilities must seek out data analytics solutions capable of managing this incoming data and realizing the promise of the smart grid.

“With the influx of big data, the potential of smart grid has shifted dramatically from the original aim of adding a myriad of new devices toward a complete re-invention of the way utilities do business,” said Rick Thompson, President and Co-Founder at GTM Research. “We are now moving into a market where the spotlight will be on the data analytics software that will allow utilities to track, visualize and predict everything from grid operations to electricity consumption. These capabilities are the core elements of what GTM Research calls the 'soft grid.'”

Driving growth of the utility soft grid are data technologies, ranging from open-source data management platforms like Hadoop, to massively parallel processing (MPP) big data appliances, to predictive analytics now catching fire in every industry, to the cost improvements and enhanced performance of underlying data storage and infrastructure layer.

Supporting this technology shift is a rich ecosystem of vendors. While the biggest names in IT are positioning themselves to be at the head of the class, it is becoming apparent that there will be several seminal companies that will be launched in this soft grid space, to which utilities will look for new products and services.

 

FIGURE: Leading Vendors in Soft Grid

Source: The Soft Grid 2013-2020: Big Data & Utility Analytics for Smart Grid

 

GTM Research analyzes more than 60 vendors in this report and identifies the following companies and their technologies as potential market leaders in each segment of the soft grid market:

  • Analytics & Applications: Opower, SAS, Space-Time Insight
  • Data Infrastructure & Storage: Cisco (NASDAQ:CSCO), IBM (NYSE:IBM), VMware (NYSE:VMW)
  • Data Management & Movement: Accenture (NYSE:CAN), IBM, SAS, Teradata (NASDAQ:TDC)


For more information on the soft grid and GTM Research’s latest report, visit http://www.greentechmedia.com/research/report/the-soft-grid-2013.

Cleantech VCs Count Profit and Loss From Investments

Thu, 12/13/2012 - 14:10

Poor performance for cleantech stocks this year may continue in 2013 despite some silver linings during 2012, a leading analyst and a panel of VCs recently warned.

Kevin Genieser, Managing Director and Global Head of Clean Technology Banking at Morgan Stanley, said that cleantech equities had underperformed this year despite a bright start to 2012 with three IPOs in the sector.

Biodiesel company Renewable Energy Group went public in January, bioenergy feedstock company Ceres followed in February, and microinverter manufacturer Enphase in March.

"But those that did go public traded down 50 percent to 75 percent since the time they went public," said Genieser.

This year's high-profile bankruptcies such as Energy Conversion Devices, owners of United Solar Ovonic, and battery maker A123 did not improve investor sentiment in the cleantech sector. Other cleantech IPO registrations were withdrawn this year, including BrightSource, Genomatica, Enerkem and Elevance.

But while the media were focused on high-profile failures and controversies around the Department of Energy's loan program, some individual stocks did well in the marketplace, said Genieser.

EnerNOC, an energy management solutions company, "was the darling of the marketplace and outperformed the market from the beginning of the third quarter," he said.

After concerns earlier this year about Tesla's new Model S, the car was the first electric vehicle to win Motor Trend magazine's Car of the Year award and hit a three-month high in trading.

Tesla was also ranked number one in this year's Deloitte Technology Fast 500, a ranking of the 500 fastest growing technology, media, telecommunications, life sciences and clean technology companies in North America. Tesla has grown 279,684 percent between 2007 and 2011. Meanwhile, EnerNOC was ranked 228th out of 500 with a revenue growth of 371 percent.

SolarCity, a residential solar installation company started by Elon Musk, Tesla's founder, is also expected to go public before the end of the year to raise around $151 million.

Genieser said that although global investment in cleantech would be an estimated $219 billion in 2012, down from $257 billion in 2011, figures for this year were more or less flat, with $220 billion invested in 2010.

Morgan Stanley also predicts a rise in natural gas prices from an average of $2.83 per mmbtu this year, to $4 per mmbtu in 2013, said Genieser, which would increase opportunities for renewables to achieve grid parity.

Superstorm Sandy had also resurrected discussion about a carbon tax in Washington and renewed interest in smart grid technology.

"One of the silver linings is that VCs are returning to where they are most comfortable: energy smart technology software communications and green IT," said Genieser. "It's no surprise that is where we're seeing large chunk of dollars going." 

Early Stages of a New Business Cycle?

Venture capitalists admitted that 2012 had been a challenging year for them. Tesla has been an especially bright spot for VantagePoint's $1.5 billion cleantech portfolio, which also includes solar thermal developer BrightSource and MiaSolé. MiaSolé, a thin-film solar manufacturer, was acquired in a "distressed sale" earlier this year by Chinese company Hanergy for $30 million after receiving hundreds of millions from investors.

Stephen Dolezalek, who leads VantagePoint's cleantech practice, said he had seen growing pains in other VC-backed industries and dismissed claims that cleantech did not fit their investment model.

"One of the unfortunate patterns is that you carry the scars of previous battles. I remember this argument coming up when we were building out the computer infrastructure in the 1980s. I remember it coming up at the end of the 1980s when we were building out pharmaceutical infrastructure and trying to run clinical trials for biotech companies. I remember it in 2002 when we were trying to build out 3G networks."

"It seems like every single wave goes through a lot of enthusiasm; [but] you've got to build out the infrastructure on which the industry will ultimately rely. But if we hadn't built disk drives, if we hadn't built solid-state memory; if we hadn't built internet networks, we wouldn't have Facebook, we wouldn't have social networking, we wouldn't have cloud [computing].

"Without building smart grids, smart meters and solar panels and windmills, we won't have the infrastructure that will allow us in ten to fifteen years to manage this infrastructure in this high technology play.

"It would be nice to say we can go directly to the sexy stuff, the high margin stuff, but unfortunately, we've got to build the hard stuff first." 

Dolezalek said that the government's help was critical, especially to level the playing field with heavily subsidized companies in other countries.

"So much of this government talk is like playing by bridge rules when everyone else is having a bar fight," he said. "Should we be picking winners and losers, should we be doing early-stage? The reality is, we play to win and we're playing in a global market and we're playing in a market where there's no question that the government in China absolutely intends to pick winners and the same is going on in Saudi Arabia. If we want to play by bridge rules, that's great. But that's not the set of rules that the others are playing by. So if we want to win this battle, we have to play to win. [...] It's about picking policy direction and [backing] investors to stand behind us. That's what government policy needs to do."

Nat Goldhaber, managing director of Claremont Creek Ventures, said that it was a "fantasy" to assume that free market rules apply in the energy industry.

"It's all about government all the way down, whether it's your local PUC, FERC or OPEC, a quasi-government organization. Everybody other than us is manipulating for price. So the question for us as VCs and entrepreneurs is, how do you fit in within the wheels of that manipulation, try to anticipate in the appropriate way and build products and services that fit in as best they can independent of these smart or stupid decisions by government."

***

Editor's note: This article is reposted in its original form from AOL Energy. Author credit goes to Felicity Carus.

Oracle to Buy DataRaker for Utility Analytics

Thu, 12/13/2012 - 13:30

Oracle announced it will acquire DataRaker, a cloud-based utility analytics company.

The need for big data solutions is growing quickly for utilities as smart meters deliver millions of readings and distributed intelligence on power, gas and water grids need to be processed and analyzed.

The market is growing quickly, according to the new report The Soft Grid 2013-2020. GTM Research forecasts that electric utilities will spend $322.5 million on analytics in the U.S. alone in 2012, a figure that will reach $1.4 billion by 2020.

“Big Data created by smart meters and sensors has presented utilities with an enormous opportunity to improve operations and deliver better customer service by acting on the unique insights that can only be found by understanding the massive amounts of data coming from their customers and networks,” Rodger Smith, Senior Vice President and General Manager at Oracle Utilities, said in a statement. “With DataRaker, Oracle can provide customers a complete and integrated set of products to further unlock efficiencies and create data insights that maximize business value.”

DataRaker describes itself as a software-as-a-service company providing data analytics for utilities, primarily crunching data from smart meters (the firm prefers the term "fixed meter").

The Sausalito-based company has 24 million smart meters under contract (about 18 million of which are already installed) and is working with large utilities including PPL, PECO and Kansas City Power & Light. Many of DataRaker’s customers already have MDM systems and are using DataRaker to provide deeper analytics than current systems provide.

“DataRaker’s cloud-based analytics, when combined with Oracle Utilities solutions, are expected to transform meter, customer, network and asset Big Data for improved decision-making capabilities,” Oracle said in a statement. Oracle will integrate DataRaker’s platform into the Oracle Utilities applications portfolio.

Oracle is painfully aware that there is a disconnect between collecting data and actually doing something with that information. In a report issued earlier this year, the software giant noted that utilities rate themselves at 6.7 on a scale of 1-10 as being “somewhat prepared” for the exponential growth in data. Less than half of utilities installing smart meters have meter data management software in place.

While companies like Oracle always think more data is better, utilities often don’t take the view that more is better; instead, it needs to be the right data. That sentiment, however, is likely to change in coming years, which is what Oracle is banking on with this latest acquisition.

The terms of the deal were not disclosed.

Wind Industry Calls for 6-Year Phaseout of PTC Subsidy

Thu, 12/13/2012 - 13:00

The American Wind Energy Association (AWEA) sent a letter to Congressional leaders accepting a six-year phase-down of its vital production tax credit (PTC) in return for getting it extended at 100 percent of its present value for projects started next year and 90 percent for projects placed in service in 2014.

The tax credit of $0.022 per kilowatt-hour of electricity for the first ten years of a turbine’s production is estimated to have leveraged $15.5 billion in private investment in wind over the last five years. It was extended for three years as part of the financial crisis relief package of 2008 and led to growth through the recession.

The PTC has allowed the industry to establish “a stable base market” on which “further market and technology innovation” over the next six years will, if the industry is properly supported, become competitive without the incentive, AWEA’s letter announced.

From “detailed economic analyses and high-level discussions with industry leaders,” AWEA’s letter noted, the industry requires only a stable, predictable phase-down of its federal incentive over an adequate timeline. AWEA recommended taking the PTC down to 80 percent of its present value for projects placed in service in 2015, 70 percent for 2016, and 60 percent for 2017 and 2018.

But, AWEA CEO Denise Bode said, “Our number-one priority right now is not putting the wind industry over its own fiscal cliff.”

 

The letter was addressed to Senate Finance Committee Chair Max Baucus (D-MT) and ranking member Orrin Hatch (R-UT), House Ways and Means Committee Chair Dave Camp (R-MI) and ranking member Sander Levin (D-MI), House Speaker John Boehner (R-OH) and Minority Leader Nancy Pelosi (D-CA), Senate Majority Leader Harry Reid (D-NV) and Minority Leader Mitch McConnell (R-KY).

“Congress must extend the wind energy Production Tax Credit for projects that start next year, to save an entire U.S. manufacturing sector and 37,000 jobs that we’ll otherwise lose by early 2013,” the letter said. “Specifically, we urge Congress to extend the wind tax credit for all projects that commence construction in 2013, as adopted by the Senate Finance Committee on August 2, on a bipartisan 19-5 vote.”

The phase-out proposed in AWEA’s letter was essentially what was reported here November 20. The industry needs about two technology cycles for innovation to bring the levelized cost of wind generated electricity to subsidy-free competitiveness, a wind industry insider told GTM. A technology cycle is two to three years, he had said, and after a short-term renewal of the PTC was secured in Congress’s lame duck session, he explained, AWEA hoped to negotiate a phase-down of perhaps five years with Congress. 

The PTC was initially granted to the wind industry in 1992 as a yearly incentive. Over the years, its extension was periodically the subject of political infighting. Installed capacity in 2000 dropped 93 percent when extension of it was delayed in 1999. Production dropped 73 percent in 2002 when that happened in 2001. And it dropped 77 percent in 2003 when it happened in 2002.

The 37,000 jobs lost and $15.5 billion investment numbers cited in the AWEA letter came from a study by the nonpartisan research firm Navigant. Its methodology was valid, an NREL researcher in the same area told GTM, and its conclusions were entirely reasonable.

Some observations from experts in finance at a recent wind industry forum looked at variables that could affect what was an entirely hypothetical phase-down at the time. They include the price of natural gas, the potential for a significant change in interest rates that alters the equations on which economic analyses are done, and the nature of state mandates and the associated utility demand.

A wind industry veteran said that it comes down to having a push and a pull. The PTC was instituted in 1992, he recalled, but it didn’t start really driving growth until state RPSs were widely instituted after 1999. That, he said, added demand to the return developers could expect from providing supply because of the PTC.

At present, load is flat due to economic stagnation, excess capacity, energy efficiency improvements, low natural gas prices and the filling out of many state mandates. Technology advances will continue to grow efficiencies. But an economic recovery could grow demand, put excess capacity to work, and drive the price of natural gas up. And state legislatures may increase existing mandates, all of which would increase wind’s return.

"We want to move the industry toward becoming competitive without the subsidy,” John Eber, Energy Investments Managing Director at JP Morgan (NYSE:JPM) noted. “That was the whole purpose of it -- to be a bridge.”

***

Check GTM’s ongoing look at how solar might fare without its investment tax credit.

CSP 2012: Concentrated Solar Power Review

Thu, 12/13/2012 - 10:00

The four major CSP companies kept their PPA-driven flagship projects on track for power production in 2013.

One: Abengoa’s 280-megawatt Solana parabolic trough project with six hours of storage in Arizona;

Two: The BrightSource Energy (BSE) 370-megawatt (cumulative) Ivanpah Units One, Two, and Three pressurized steam solar power tower in California’s Mojave Desert just across the border from Las Vegas;

Three: SolarReserve’s 110-megawatt Crescent Dunes solar power tower outside Tonopah, Nevada, with ten hours of molten salt storage; and

Four: The NextEra Energy (NYSE:NEE) 250-megawatt Genesis trough project in California’s southeastern Mojave region.

President Clinton’s visit to Ivanpah in August spotlighted the excitement CSP developers are feeling, despite BSE’s canceled IPO bid.

 

Source: GTM Research’s U.S. Solar Market Insight

The Rise of an Alliance

Five: This year’s formation of the CSP Alliance included founding members Abengoa, BSE, and Torresol, as well as Cone Drive, Lointek, and Wilson Solarpower. Former DOE solar programs leader Frank “Tex” Wilkins was named the first Executive Director.

CSP’s International Play

Six: Middle East and Levant heating up.

Saudi Arabia revealed details this year of its King Abdullah City for Atomic and Renewable Energy (K.A. CARE) $109 billion solar development program. They include a CSP target of 25 gigawatts by 2032. The first round will open to bids in 2013 and industry insiders say the Saudis are talking to all major CSP developers.

The Saudi ambitions, it is thought, are at least in part due to the as-yet little-developed CSP supply chain. Because it is largely a manufacturing industry not unlike that for traditional power generation hardware, it offers Saudi Arabia the opportunity to build a blue-collar jobs base.

Abengoa’s 100-megawatt trough project with storage in Abu Dhabi, funded by Abu Dhabi’s Masdar Corporation (60 percent) and Abengoa (40 percent), will be the world’s biggest single-site CSP project when it goes on-line at the end of 2012.

A consortium composed of Saudi-based ACWA Power and Spanish interests was awarded a 25-year PPA by Morocco to build the 160-megawatt Ouarzazate trough project with three hours of storage.

BSE, in partnership with multinational powerhouse Alstom, won a 25-year PPA for a 121-megawatt solar power tower in Israel’s Negev Desert, the first unit of the planned 250-megawatt Megalim Solar Project.

Seven: South Africa was the next most active international CSP market in 2012. Abengoa won Round Two PPAs in Eskom’s procurement program and began construction on the 50-megawatt Khi Solar One solar power tower and the 100-megawatt KaXu Solar One trough projects, both with storage.

The program has targeted 1,000 megawatts of CSP. SolarReserve is preparing a Round Three solar power tower bid. BSE partnered with multinational Sasol on a feasibility study for a solar power tower project.

Eight: Spain’s economic restructuring and austerity program included a reduction of solar incentives and a moratorium on new solar power plants. But the already under construction Torresol-Masdar-SENER funded 50-megawatt Valle One and Valle Two trough projects with a cumulative 7.5 hours of storage joined Spain’s 37 other CSP projects on-line in 2012, bringing Spain’s world-leading cumulative CSP installed capacity to 1,781 megawatts.

Nine: India’s 22,000-megawatt National Solar Mission gave AREVA Solar’s Compact Linear Fresnel Reflector (CLFR) technology a boost when Reliance Power picked CLFR for a 250-megawatt installation, likely to be Asia’s biggest when construction -- started this year and scheduled in two 125-megawatt phases -- is completed.

AREVA’s CLFR technology got a smaller boost early in the year when Tucson Electric Power picked it for a five-megawatt CSP addition to the 156-megawatt Sundt hybrid natural gas and coal power plant. This could be the beginning of bigger things for AREVA in the U.S. if experiments with molten salt storage at Sandia National Lab pay off and the technology can hit the right price point.

China has a 1,000 megawatts by 2015 CSP target but seems presently focused on PV because of its once-skyrocketing PV manufacturing sector’s painful rationalization process.

 

Source: GTM Research’s U.S. Solar Market Insight

Politics and Policy

Ten: President Obama’s re-election buoyed the spirits of the renewables industry. The policy that could help CSP along will takes its cues from the California grid operator, NREL, LBNL and others showing CSP to provide power system savings that smoothes transmission load.

Absent such policy, the California Public Utilities Commission in November granted BSE just two of its five proposed PPAs, asking it to use one unit of Rio Mesa to prove its next generation technology and one unit of Sonoran West to prove its storage technology. SolarReserve’s solar power towers in Arizona (Crossroads) and Colorado (Saguache) still lack PPAs as regulators await marketplace verification of CSP’s economic value and viability.

GE’s Industrial Internet and the Smart Grid in the Cloud

Wed, 12/12/2012 - 16:30

Two weeks ago, General Electric made a big splash in the world of the Internet of Things, or, as GE likes to call it, the “industrial internet.” In a series of high-profile announcements, the global energy and engineering giant laid out its plan to add networking and distributed intelligence capabilities to more and more of its devices, ranging from aircraft engines to industrial and grid control systems, and start analyzing all that data to drive big new gains in efficiency across the industries it serves.

That includes the smart grid, of course. GE is a massive grid player, alongside such competitors as Siemens, ABB, Alstom, Schneider Electric and Eaton/Cooper Power. But in terms of scope, GE and Siemens stand apart in that they make everything from natural gas and wind turbines, to the heavy transmission and distribution gear -- transformers, sensors, switches and the like -- that delivers it to end users.

GE and its competitors also have their own lines of industrial communication, networking and control gear for distribution automation (DA) tasks on the grid, of course. Unlike most of the above-named competitors, however, GE is also a big maker of smart meters – although the networking technology that links up all those meters tends to come from other partners.

So we’ve got the technological underpinnings for a true Internet of things environment on the smart grid. But who’s managing it all on the back end? Right now, utilities tend to run their own data centers and back-office control rooms. But legacy billing, customer service and enterprise resource planning systems don’t easily integrate with the new breed of data coming at them from the smart grid. Indeed, we’ve got a host of IT giants like Cisco, IBM, Microsoft, Oracle, SAP, Infosys, Wipro and many more offering smart grid software services and integration, aimed at making sure data from smart meters, grid sensors and other formerly siloed technologies can be freely shared across the enterprise.

Perhaps the most important stepping stone for GE in moving its smart grid business into the “industrial internet” age is to capture its own share of this future market in smart grid integration. GE’s “Grid IQ Solutions as a Service” business, launched last year, represents that effort. In a move increasingly being rolled out by grid giants and startups alike, GE is moving the smart grid to the cloud -- in this case, dedicated servers in its GE Digital Energy data center in Atlanta, Ga. -- and offering utilities the opportunity to choose from a list of products and functions they’d like to deploy, all for a structured fee.

In the year since it launched, GE’s smart grid service has landed two city utilities, Norcross, Ga. and Leesburg, Fla., as named customers for its first SaaS product line, the Grid IQ Connect platform. That’s essentially a smart meter deployment run and managed by GE working with unnamed AMI partners, Todd Jackson, SaaS product line leader for GE Digital Energy, said in a Tuesday interview.

GE has lined up partners to provide a host of AMI networking flavors, including the mesh networking that dominates in U.S. smart meter deployments to date, as well as point-to-multipoint and cellular solutions, Jackson said. That’s not unlike GE’s current smart metering business model, in which it works with partners such as Silver Spring Networks, Trilliant, and others that add their own communications gear to GE’s core meters.

GE’s new role as back-end IT services provider to its Grid IQ Connect customers means that GE is also bringing a lot more software expertise to the fore, Jackson noted. While its AMI partners tend to provide the networking and meter data management aspects of the deployment, GE is providing about half of the remaining IT functionality, he said -- including the core task of hosting all its partners’ software on its own dedicated servers. GE has also been rolling out new feature sets for its smart-grid-as-a-service platform, including prepay options for smart meters, as well as its Grid IQ Restore, which adds outage detection and management to the array of options for its customers.

Expanding the Service Set With Demand Response

Earlier this year, GE also took a step beyond the utility and into the homes and businesses that they serve, launching its Grid IQ Respond platform. Essentially, it’s a version of GE’s demand response technology offered over the cloud, and is currently being rolled out with three unnamed utilities, two in the United States and one in Europe, Jackson said.

Right now the projects are mostly focused on homes, he explained, and most of those are connecting to load control switches, attached to major household loads like pool pumps, water heaters and air conditioners, that the utility can switch off and on to help manage peak power demands. A few million homes across the U.S. have these kinds of radio or pager-operated load control switches installed, usually in exchange for rebates or cheaper power rate offers from utilities desperate to curb their customers’ appetite for expensive peak power.

At the same time, competitors in this business, such as Honeywell, Eaton/Cooper Power, Comverge and others, have been busy working on their own software-as-a-service models, complete with cloud-hosted applications and increasing options for networking end-devices in homes and businesses. And of course, we’ve got literally dozens of startups competing for the still-nascent market for in-home energy management devices and the networks that can connect them to utilities, as well as the internet at large.

GE, which is a huge appliance maker, has its own version of a home energy management device, called the Nucleus. But it hasn’t rolled it out to market yet, preferring to keep it in pilot projects so far, and Jackson said there aren’t any immediate plans to include it in GE’s Grid IQ Respond offerings.

As for target markets, GE is largely looking at municipal utilities and cooperatives, which tend to lack the big budgets and capital expenditure recovery mechanisms of larger investor-owned utilities (IOUs), Jackson said. At the same time, GE does offer its smart grid platform in a so-called “boosted model,” in which utilities can put the capital equipment on their balance sheets, as well as a managed service model where GE owns the hardware, he said. So far, utilities are about evenly split in their interest between the two business models, he said.

The Industrial Internet, Slowly

So how does this tie into the Internet of Things concept? Well, “Once the network is deployed, there are other things that municipal utilities can tie in there and benefit from,” Jackson noted. Some examples include the ability to connect streetlights or traffic cameras to the same network that supports smart meters, he said. That’s a concept that we’ve seen deployed by such smart grid players as Sensus and Santa Clara, Calif.-based startup Tropos Networks, which was bought by grid giant ABB earlier this year.

On the backend IT side, GE is also tackling challenges like connecting smart meter data to customer service platforms and other utility business software platforms, Jackson said. That’s led to integration that allows customer service reps to tie directly into an individual customer’s smart meter during an outage, to figure out whether or not it’s a utility problem or a blown fuse, for example -- the kind of incremental improvement that only comes when data is freely shared.

Whether or not utilities will catch on to the smart-grid-as-a-service model remains to be seen. Jackson said that GE has been talking to multiple utilities that haven't announced themselves yet. Amidst a general slowdown in North American smart meter deployments expected next year, smaller municipal and cooperative utilities stand out as a relatively untapped sector -- and one that will need some help in managing the IT behind an AMI or DA deployment at a cost commensurate with the smaller scale of their projects, in the tens or hundreds of thousands of meters, rather than millions.

Utilities do face some regulatory challenges and uncertainties in turning over key parts of their operations to a third party. At the same time, they're under pressure to meet a whole new array of requirements, including smart grid security and data privacy, that may well be better managed by a big central provider like GE than by each small utility. In the end, services will be the key to unlocking the small utility smart grid market, to be sure. But GE faces plenty of competition in establishing itself as the platform to trust -- and as with every shift in the way utilities do business, it's going to take years to develop.

SolarCity to Open at $8 Per Share on NASDAQ Thursday AM

Wed, 12/12/2012 - 15:00

SolarCity will be a public company on Thursday morning. (Thanks Dana Hull).

After lowering its stock price to a reported $10 per share from a range of $13 to $15, IPO aspirant SolarCity was unable to fill its book and postponed its IPO, according to Reuters, which quoted an underwriter of the deal. SolarCity has not returned requests for comment.

SolarCity then lowered the deal size and now looks to raise $92 million and sell 11.5 million shares at $8 under the symbol SCTY. (See S-1 Amendment No. 5)

SolarCity hoped to sell 10 million shares of its stock at $13 to $15 per share in its maiden offering. A total of 65,012 shares were to be sold by stockholders. SolarCity had originally planned to raise $201 million. 

According to the S-1 amendment, Chirman Elon Musk still intends to purchase $15 million of shares at the IPO price:

Elon Musk, the chairman of our board, has indicated his intent to purchase $15.0 million of our common stock in this offering from the underwriters at the initial public offering price [...] Entities affiliated with Draper Fisher Jurvetson have indicated an intent to purchase an aggregate of 1,500,000 shares of our common stock in this offering at the initial public offering price. Entities affiliated with DBL Equity Fund have indicated an intent to purchase an aggregate of 300,000 shares of our common stock in this offering at the initial public offering price.

Like BrightSource Energy, another solar firm, albeit in vastly different sectors -- institutional investors were having none of the high valuations anticipated by these VC-funded startups. If you're selling electrons like SolarCity or BrightSource Energy, then you get valued like a conventional power generator, not like a consumer gadget.

***

We reported on some accounting headwinds at the firm earlier today, and looked at the stock performance of recent greentech IPOs.

Included in Amendment No. 3 to the S-1, published Friday, is this important passage regarding a judgment on the manner in which Solar City is accounting for Fair Market Value. Note that the Treasury sets different price-per-watt value guidelines by state and that Arizona takes a big hit here:

The Internal Revenue Service recently notified us that it is conducting an income tax audit of two of our investment funds

In October of 2012, we were notified that the Internal Revenue Service was commencing income tax audits of two of our investment funds which audit will include a review of the fair market value of the solar power systems submitted for grant under the 1603 Grant Program. If, at the conclusion of the audits currently being conducted, the Internal Revenue Service determines that the valuations were incorrect and that our investment funds received U.S. Treasury grants in excess of the amounts to which they were entitled, we could be subject to tax liabilities, including interest and penalties, and we could be required to make indemnity payments to the fund investors.

If the Internal Revenue Service or the U.S. Treasury Department makes additional determinations that the fair market value of our solar energy systems is materially lower than what we have claimed, we may have to pay significant amounts to our investment funds or to our fund investors and such determinations could have a material adverse effect on our business, financial condition and prospects.

We and our fund investors claim the Federal ITC or the U.S. Treasury grant in amounts based on the fair market value of our solar energy systems. We have obtained independent appraisals to support the fair market values we report for claiming Federal ITCs and U.S. Treasury grants. The Internal Revenue Service and the U.S. Treasury Department review these fair market values. With respect to U.S. Treasury grants, the U.S. Treasury Department reviews the reported fair market value in determining the amount initially awarded, and the Internal Revenue Service and the U.S. Treasury Department may also subsequently audit the fair market value and determine that amounts previously awarded must be repaid to the U.S. Treasury Department. Such audits of a small number of our investment funds are ongoing. With respect to Federal ITCs, the Internal Revenue Service may review the fair market value on audit and determine that the tax credits previously claimed must be reduced. If the fair market value is determined in either of these circumstances to be less than we reported, we may owe the fund or our fund investors an amount equal to this difference, plus any costs and expenses associated with a challenge to that valuation. The U.S. Treasury Department has determined in some instances to award us U.S. Treasury grants for our solar energy systems at a materially lower value than we had established in our appraisals and, as a result, we have been required to pay our fund investors a true-up payment or contribute additional assets to the associated investment funds. For example, in the fourth quarter of 2011, we had discussions with representatives of the U.S. Treasury Department relating to U.S. Treasury grant applications for certain commercial solar energy systems submitted in the third and fourth quarters of 2011 and the appropriate U.S. Treasury grant valuation guidelines for such systems. We were unsuccessful in our attempts to have the U.S. Treasury Department reconsider its valuation for these systems, and while we maintained the accuracy of the contracted value to the investment fund, we elected at that time to receive the lower amounts communicated by the U.S. Treasury Department. Thereafter, other U.S. Treasury grant applications were accepted and the U.S. Treasury grant paid in full on the basis of the valuations submitted. On December 5, 2012, the U.S. Treasury Department notified one of our investment funds that it has established new guidelines for residential solar energy systems placed in service in California and Arizona on or after October 1, 2012. The new guidelines communicated are $6.00 per watt in California and $5.00 per watt in Arizona. Prior to this change, we had been reimbursed at $6.87 per watt in California and $6.20 per watt in Arizona. As a result of this updated guidance, we will be obligated to contribute additional solar energy systems to this investment fund so that the fund investors will recover a shortfall of approximately $200,000. If the Internal Revenue Service or the U.S. Treasury Department further disagrees now or in the future, as a result of any pending or future audit, the outcome of the Department of Treasury Inspector General investigation, the change in guidelines or otherwise, with the fair market value of more of our solar energy systems that we have constructed or that we construct in the future, including any systems for which grants have already been paid, and determines we have claimed too high of a fair market value, it could have a material adverse effect on our business, financial condition and prospects. For example, a hypothetical five percent downward adjustment in the fair market value in the approximately $341 million of U.S. Department of Treasury grant applications that we have submitted as of September 30, 2012 would obligate us to repay approximately $17 million to our fund investors.

Darren Van't Hof of US Bank would not comment on the IRS judgment, saying it was inappropriate with the IPO imminent.

We'll understand the impact of this ruling when the deal prices tonight.

According to the updated S-1, Elon Musk, the chairman of the board, "has indicated his intent to purchase $15.0 million of our common stock in this offering from the underwriters at the initial public offering price." Musk's intent to purchase stock could indicate troubles in selling this IPO to institutional investors.

But Musk's Tesla is one of the few recent cleantech IPOs which has had some legs. Other recent cleantech IPOs show a clear downward trend whether they be solar or biofuels. (Stock charts from Yahoo.)

 

Tesla (TSLA) is a maker of battery-powered electric vehicles:

 

 

Enphase (ENPH) is a manufacturer of solar photovoltaic microinverter hardware for residential and commercial rooftops:

 

 

KIOR (KIOR) is a biomass-to-fuel aspirant.

 

Gevo (GEVO) is planning to produce isobutanol using synthetic biology and chemistry.

 

Amyris (AMRS) looks to use synthetic biology to make green chemicals and fuels.

 

Codexis (CDXS) also aspires to make bio-based chemicals.

 

Ceres (CERE) is a developer of green bio-crops.

 

Record US Solar PV Installations of 1.2 GW in Q4: GTM Research

Wed, 12/12/2012 - 14:00

The U.S. is going to deploy 1.2 gigawatts of photovoltaic solar power this quarter.

That's the kind of news that serves as a bellwether for the solar market, not the SolarCity IPO. If you were looking for the now-humbled SolarCity IPO to serve as the greentech savior and for Elon Musk and Lyndon Rive to lead solar to the promised land, then you were the victim of facile thinking.

The solar industry is going to be lifted out of its doldrums by getting to massive volumes at lower prices at residential, commercial, and utility scale -- not by accounting tricks, exploiting tax investment schemes, or overvalued IPOs. Those are the tools of Solar 1.0.

Solar 2.0 requires the massive consolidation that the market is currently slogging through. Solar 2.0 is when photovoltaic solar competes with fossil fuels in an unsubsidized environment. Certainly, the third-party financing pioneered by SolarCity and others is a tool in the toolbox, but it's not a panacea. Solar needs manufacturing efficiency, capacity that matches demand, and regulatory and policy consistency, as well as the innovative financing offered by the disappointed IPO aspirant and firms like Clean Power Finance, Sungevity, Sunrun, SunEdison, and OneRoof.

And that brings us to today's data point.

According to GTM Research, the U.S. will install 1.2 gigawatts of photovoltaics in the fourth quarter of 2012.

That healthy quarterly number will bring the annual U.S. solar total to 3.2 gigawatts for the year and set the U.S. up for 3.9 gigawatts of solar deployed in 2013, according to GTM Research.

The analysts at GTM forecast the U.S. solar market at 8 gigawatts in 2016.

Shayle Kann, Director of Research at GTM, notes that the U.S. market tends toward an odd seasonality, with installers rushing to complete projects before incentives wane or contracts impose penalties. The most recent U.S. Solar Market Insight report notes, "In 2010 and 2011, the fourth quarter represented 41 percent and 42 percent of all annual installations, respectively," adding, "To be sure, much of this forecast hinges on the timely completion of a number of utility-scale projects currently in the late stages of construction."

Kann also notes that the U.S. has the "firepower" to deploy gigawatt levels of solar every quarter.

Here's the sector breakdown according to the GTM Research analyst team. The obvious takeaway is the marked stress on utility scale, not residential, over the next few years in the U.S.

More detail on the U.S. solar market can be found in this quarter's U.S. Solar Market Insight report. To download the free Executive Summary, visit www.greentechmedia.com/research/ussmi.

Smart Grid Analytics Spending to Hit $1.4 Billion in US by 2020

Wed, 12/12/2012 - 11:00

Tomorrow, GTM Research will publish its latest report, The Soft Grid 2013-2020: Big Data & Utility Analytics for Smart Grid. Below is an excerpt from the report's market forecast for utility analytics. To learn more, visit www.greentechmedia.com/research/report/the-soft-grid-2013.


While there has been a period of “pilotitis” with respect to the hardware spend in smart grid deployments, GTM Research expects utility analytics to find an easier pathway to adoption by virtue of its remarkable return on investment (ROI).

FIGURE: U.S. Utility Analytics Spending and Market Penetration, 2012 to 2020


Source: The Soft Grid 2013-2020: Big Data & Utility Analytics for Smart Grid

GTM forecasts $322.5 million to be spent on analytics in the U.S. in 2012, reaching $1.4 billion by 2020, with a cumulative $8.2 billion to be spent between now and 2020. 

GTM Research expects the lion’s share of spending on smart grid analytics will begin in the United States. Over time, Europe, Asia Pacific, and Latin America will increase their spending on a percentage basis relative to the U.S., but we expect the U.S. to account for 45 percent of the global market share in 2012, with Europe and Asia Pacific each taking 25 percent and Latin America claiming the balance.

Connecticut Auction Cuts Clean Energy Costs

Tue, 12/11/2012 - 16:58

Connecticut has driven down the costs that ratepayers will incur for their public utilities' clean-energy purchases through an innovative reverse auction. The newly launched program is the first of its kind, but there's a congressional proposal with language directing the Energy Department to set up reverse, renewable-energy auctions on a nationwide basis.

The legislation has languished in the current Congress, but it will be back -- and its sponsor can now point to the promising outcome in Connecticut, where Gov. Dannel Malloy has led a charge for "cheaper, cleaner, and more reliable" electricity.

The state's auction was mandated by the 2011 Energy Act and held last spring by Connecticut's two distribution companies -- United Illuminating and Connecticut Light & Power. The utilities selected from 368 bids, 87 solar, and 10 fuel-cell projects qualifying under the state's Low- and Zero-Emissions Renewable Energy Credit (LREC and ZREC) Program.

In this first round of auctions, UI and CL&P solicited bids for large and medium-sized ZREC projects and LREC projects of any capacity. The bids were expressed as prices for renewable energy credits that the projects would be assigned on the basis of one REC per megawatt-hour of electrical generation.

The bids were limited to $350 per REC for ZREC projects and $200 per REC for LREC projects. However, the utilities won't have to pay anywhere near those numbers for the 31 megawatts that the winning bidders will produce from their 97 projects.

The resulting RECs will cost UI and CL&P a total of $8.1 million annually, which works out to an average weighted price of $90 per REC -- or far less than REC prices in many other states.

Alex Kragie, a senior official in Connecticut's Department of Energy and Environmental Protection, told AOL Energy, "As predicted, the results showed that the program successfully drove down the cost of clean energy even more impressively than we had anticipated, which is a huge step towards grid parity."

Creative Financing Mechanisms are Key

Kragie also pointed out that the winning bidders will enjoy a rock-solid assurance that the REC prices paid for their projects' output will never change during the 15-year terms of their contracts. Like the reverse auction itself, the price guarantee is unique in comparison to the terms in practically all other PPAs for renewable energy.

DEEP Commissioner Dan Esty said, "This is the key to the program because these [REC price] commitments enable the developers to get private sector loans to build out the projects. We believe that the key innovations required for renewable energy development are much less in the area of technology than in the area of financing -- particularly with government funding for subsidies being so limited."

Reed Hundt, CEO of the Coalition for Green Capital, said that Esty and Gov. Malloy -- who had directed Esty to come up with a legislative proposal for clean energy incentives -- "should get all the credit in the world. They're protecting the ratepayer and the taxpayer while fostering clean energy conversions. A lot of economists think customers have to be punished in exchange for clean energy conversions, but they're wrong, wrong, and wrong."

Hundt, who served as FCC commissioner under President Bill Clinton, is very familiar with auctions inasmuch as he had been tasked with launching "spectrum auctions" of the commercial airwaves. He observed that clean-energy subsidies are typically too high or too small, "so you have to think of a way to get the maximum amount of clean electricity for the least amount of money. And that's what Connecticut has achieved with its reverse auction."

Using market incentives instead of government subsidies to foster clean electricity was the motivation for Rep. Devin Nunes (R-CA) to include a national, reverse-auction mandate (Title III) in his comprehensive energy bill, H.R. 909.

Advocating the Market-Based Approach

In a statement, Nunes said, "The government's preferred method of supporting alternative energy -- doling out millions of taxpayer dollars and taxpayer-backed guarantees to risky green-energy startups -- is inefficient, unfair, and prone to corruption and cronyism. This system should be replaced by reverse auctions, which are a more efficient, market-oriented way to accomplish the same goal."

Nunes spokesperson Jack Langer told AOL Energy that the congressman intends to bring back his reverse-auction proposal in the next Congress.

Brown Rudnick partners John Wadsworth and Phil Small told AOL Energy that reverse auctions will help eliminate the boom-and-bust cycles that are inevitable when states set lofty REC prices to encourage green energy development, leaving developers stuck with inadequate REC payments after the initial flood of projects saturates the market with RECs and their prices collapse.

Wadsworth and Small recently published in Law360 an article entitled, "Could CT's Approach to Clean Energy Be a National Model?" The attorneys both said the answer to the question is yes, adding that one of the auction problems addressed by Connecticut is potential non-performance by winning bidders.

That's because the winners are required to put up 10 percent or 20 percent of their project costs (for medium and large projects, respectively) when they sign their PPAs, and they forfeit the earnest money if they don't build their promised projects, thereby ensuring that the utilities (and their ratepayers) aren't left holding the bag. 

Equally as important is the contribution that the performing bidders will make toward bringing the utilities into compliance with the state's renewable portfolio standard: 9 percent this year and 20 percent as of 2020. Esty said the utilities have been "barely" complying with the standard because "there are very few opportunities to buy low-cost renewable power [in- or out-of-state], and the utilities have been hesitant about going out and purchasing clean but expensive power -- and we concur with that sensitivity."

Looking further out, Kragie said reverse auctions and financing support will pave the way for renewable energy to become the third piece of the country's predicted energy "renaissance," with the other two pieces being cheaper natural gas and a surge in domestic oil production. "The big question," Kragie said, "is who will be the 'Chuck Yeager' who breaks through the 'carbon barrier' and delivers electricity at prices below that level."

***

Editor's note: This article is reposted in its original form from AOL Energy. Author credit goes to Phil Zahodiakin.

Cisco, Japan, Wi-SUN and the Global Smart Grid Standards Race

Tue, 12/11/2012 - 15:45

Today’s smart grid is a tangled web of communications technologies, some of them decades old, some of them brand new -- but almost all of them proprietary in nature. Where standards for interoperability do exist, they’re complicated by the fact that utilities still need them to interoperate with existing gear, ranging from SCADA systems to the latest in 4G wireless, and everything in between.

Enter the Wi-SUN Alliance, a Japanese group with international partners including Silver Spring Networks and, most recently, Cisco. Wi-SUN is working on a complicated goal: to get a global set of manufacturers to agree on some common specifications for the communications gear they’re building for the smart grid.

In a Tuesday morning blog post, Cisco laid out its role in Wi-SUN (so named for "smart utility networks"), focused on its vision of field-area networks (FAN) built on devices from multiple partners, all built on Internet Protocol (IP). Other Wi-SUN partners include Fuji Electric, Murata Manufacturing, Omron Corp., Osaki Electric, Renesas Electronics and Japan's National Institute of Information and Communications Technology (NICT).

Wi-SUN has thrown two interoperability events so far, but it hasn’t set any hard dates for when it expects the first set of certifications to be released. As Gary Stuebing, global smart grid standards managing engineer for Cisco’s connected energy networks (i.e., smart grid) business, noted in a Monday interview, the group has a long road ahead of it.

To get there, Wi-SUN members are busy hashing out a certification regime, likely based on existing technologies in key markets like North America, Europe and Japan/Asia, he said. At the end of the line, “What we really want is devices from different manufacturers that can talk to each other at some base level,” he added.

Wi-SUN is focused on the IEEE 802.15.4g and 802.15.4e specifications, which deal with the physical and media access control (i.e., PHY/MAC) layers of the network in which these devices operate. It’s not the only Japanese group working on these standards -- another group, including NICT, Elster, Itron, Landis+Gyr and Silver Spring Networks, announced their participation on the latest 802.15.4g efforts in May.

Elster, Itron, Silver Spring and Landis+Gyr, which was bought by Toshiba for $2.2 billion in 2010, also represent a list of likely contenders for Japan’s much-anticipated smart meter deployment plans. Tokyo Electric Power Co. (TEPCO), the country's biggest utility, wants to deploy about 17 million smart meters over the span of the decade, and could help set nationwide standards in choosing its partners. New Wi-SUN Alliance partners also include Huawei and Toshiba, indicating other communications contenders on the horizon.

Cisco, of course, is already supplying its own IPv6-ready, 802.15.4g-congruent wireless-and-wireline communications technology, via its smart grid switches and routers being deployed by utility partners worldwide, as well as through partners including Itron, Elster and Alstom. Last month it landed its first toehold in Asia with a pilot project for China Light and Power Hong Kong, featuring Itron’s cellular-connected meters and Cisco’s connected grid management system.

But Wi-SUN members will also need to contend with some key regional differences, including the use of different radio bands for the underlying 802.15.4g technology in different regions, Stuebing noted. For example, Elster, Itron, Landis+Gyr and Silver Spring all use 900-megahertz radios for North American smart meter deployments, but those bands are largely reserved for other uses in Europe and Japan, requiring a different approach.

Other complications arise in matching field-area or neighborhood-area networks -- FAN and HAN, in smart grid parlance -- to the different wireless technologies meant for so-called home area network (HAN) use. For example, while U.S. smart meters have largely chosen the low-power ZigBee wireless standard, “the Japanese have a strong interest in EchoNet,” an alternative standard, Stuebing said -- “so if we want to operate in Asia, we have to be interested in EchoNet as well.” At the same time, we’ve seen IPv6-capable home area networks rolled out by contenders like GreenWave Reality and NXP, and promised by Google’s Android@Home platform.

Cisco would certainly like to see future Wi-SUN certified devices integrate well with its own technology, particularly on the distribution automation front, Stuebing said.  He previously worked for Duke Energy, the country’s biggest utility and a big Cisco smart grid partner, on its slow and measured approach to its smart grid deployments, so he’s aware of how long it takes for the utility industry to get on board with new technologies.

But one thing’s for sure, he said -- “Utilities love standards, because that means they don’t have to single-source anything.” That basic idea of opening up the smart grid to a plug-and-play approach is far more complex to implement in the real world, of course -- and Cisco no doubt would like to be the platform of choice to make it all happen.

The IRS Knocks: Can SolarCity Break the Curse of the Cleantech IPO?

Tue, 12/11/2012 - 13:59

If everything goes as planned, SolarCity will price its stock tonight and go public on the Nasdaq exchange tomorrow. But there might be some headwinds in the form of a judgment by the IRS.

SolarCity hopes to sell 10 million shares of its stock at $13 to $15 per share in its maiden offering. A total of 65,012 shares are to be sold by stockholders. SolarCity's plans to raise $201M have been pulled back -- the firm now looks to raise approximately $151 million, according to this filing with the SEC.

Included in Amendment No. 3 to the S-1, published Friday, is this important passage regarding a judgment on the manner in which Solar City is accounting for Fair Market Value. Note that the Treasury sets different price-per-watt value guidelines by state and that Arizona takes a big hit here:

The Internal Revenue Service recently notified us that it is conducting an income tax audit of two of our investment funds

In October of 2012, we were notified that the Internal Revenue Service was commencing income tax audits of two of our investment funds which audit will include a review of the fair market value of the solar power systems submitted for grant under the 1603 Grant Program. If, at the conclusion of the audits currently being conducted, the Internal Revenue Service determines that the valuations were incorrect and that our investment funds received U.S. Treasury grants in excess of the amounts to which they were entitled, we could be subject to tax liabilities, including interest and penalties, and we could be required to make indemnity payments to the fund investors.

If the Internal Revenue Service or the U.S. Treasury Department makes additional determinations that the fair market value of our solar energy systems is materially lower than what we have claimed, we may have to pay significant amounts to our investment funds or to our fund investors and such determinations could have a material adverse effect on our business, financial condition and prospects.

We and our fund investors claim the Federal ITC or the U.S. Treasury grant in amounts based on the fair market value of our solar energy systems. We have obtained independent appraisals to support the fair market values we report for claiming Federal ITCs and U.S. Treasury grants. The Internal Revenue Service and the U.S. Treasury Department review these fair market values. With respect to U.S. Treasury grants, the U.S. Treasury Department reviews the reported fair market value in determining the amount initially awarded, and the Internal Revenue Service and the U.S. Treasury Department may also subsequently audit the fair market value and determine that amounts previously awarded must be repaid to the U.S. Treasury Department. Such audits of a small number of our investment funds are ongoing. With respect to Federal ITCs, the Internal Revenue Service may review the fair market value on audit and determine that the tax credits previously claimed must be reduced. If the fair market value is determined in either of these circumstances to be less than we reported, we may owe the fund or our fund investors an amount equal to this difference, plus any costs and expenses associated with a challenge to that valuation. The U.S. Treasury Department has determined in some instances to award us U.S. Treasury grants for our solar energy systems at a materially lower value than we had established in our appraisals and, as a result, we have been required to pay our fund investors a true-up payment or contribute additional assets to the associated investment funds. For example, in the fourth quarter of 2011, we had discussions with representatives of the U.S. Treasury Department relating to U.S. Treasury grant applications for certain commercial solar energy systems submitted in the third and fourth quarters of 2011 and the appropriate U.S. Treasury grant valuation guidelines for such systems. We were unsuccessful in our attempts to have the U.S. Treasury Department reconsider its valuation for these systems, and while we maintained the accuracy of the contracted value to the investment fund, we elected at that time to receive the lower amounts communicated by the U.S. Treasury Department. Thereafter, other U.S. Treasury grant applications were accepted and the U.S. Treasury grant paid in full on the basis of the valuations submitted. On December 5, 2012, the U.S. Treasury Department notified one of our investment funds that it has established new guidelines for residential solar energy systems placed in service in California and Arizona on or after October 1, 2012. The new guidelines communicated are $6.00 per watt in California and $5.00 per watt in Arizona. Prior to this change, we had been reimbursed at $6.87 per watt in California and $6.20 per watt in Arizona. As a result of this updated guidance, we will be obligated to contribute additional solar energy systems to this investment fund so that the fund investors will recover a shortfall of approximately $200,000. If the Internal Revenue Service or the U.S. Treasury Department further disagrees now or in the future, as a result of any pending or future audit, the outcome of the Department of Treasury Inspector General investigation, the change in guidelines or otherwise, with the fair market value of more of our solar energy systems that we have constructed or that we construct in the future, including any systems for which grants have already been paid, and determines we have claimed too high of a fair market value, it could have a material adverse effect on our business, financial condition and prospects. For example, a hypothetical five percent downward adjustment in the fair market value in the approximately $341 million of U.S. Department of Treasury grant applications that we have submitted as of September 30, 2012 would obligate us to repay approximately $17 million to our fund investors.

Darren Van't Hof of US Bank would not comment on the IRS judgment, saying it was inappropriate with the IPO imminent.

We'll understand the impact of this ruling when the deal prices tonight.

According to the updated S-1, Elon Musk, the chairman of the board, "has indicated his intent to purchase $15.0 million of our common stock in this offering from the underwriters at the initial public offering price." Musk's intent to purchase stock could indicate troubles in selling this IPO to institutional investors.

But Musk's Tesla is one of the few recent cleantech IPOs that has had some legs. Other recent cleantech IPOs show a clear downward trend whether they be solar or biofuels. (All the following stock charts are from Yahoo.)

 

Tesla (TSLA) is a maker of battery-powered electric vehicles:

 

 

Enphase (ENPH) is a manufacturer of solar photovoltaic microinverter hardware for residential and commercial rooftops:

 

 

KIOR (KIOR) is a biomass-to-fuel aspirant:

 

Gevo (GEVO) is planning to produce isobutanol using synthetic biology and chemistry:

 

Amyris (AMRS) looks to use synthetic biology to make green chemicals and fuels:

 

Codexis (CDXS) also aspires to make bio-based chemicals:

 

Ceres (CERE) is a developer of green bio-crops:

 

Top Ten Greentech Media Articles of 2012

Tue, 12/11/2012 - 13:30

1.) Polysilicon Prices Hit Record Low in 2011; Will Head Even Lower, Enabling $0.70/W PV in 2012

The analysts at GTM Research saw that crystalline silicon (c-Si) module prices fell from $1.80 per watt at the start of 2011 to $0.90 per watt by the year's end. The group suggested $0.70 per watt modules would be available at the end of 2012 -- and they were spot on.

 

2.) Serious Energy in Serious Trouble

Jeff St. John takes a careful look at Serious Energy. The green drywall and windows company spent the past few years pushing into building energy efficiency software and financing, and then abandoned those lines of business to refocus on its building materials core. It was a stunning reversal for the Sunnyvale, Calif.-based startup with $140 million in VC cash. Over the past year, Serious has been bleeding talent, losing top executives from including key players in its energy efficiency software development team and sales team.

 

3.) Who Reigns Supreme in Residential Solar?

In this analysis by Andrew Krulewitz from earlier this year, SolarCity was revealed to have a 14 percent market share for residential solar in 2011. He wrote, "SolarCity is already far ahead of the pack and well on its way to conquering the small-commercial market, as well." SolarCity and its bankers aim to price its IPO tonight and float the stock on Wednesday.

 

4.) Twin Creeks: Secretive Solar Equipment Firm Unstealths

Twin Creeks Technologies was a stealthy thin-silicon via ion-implant equipment startup with lots of venture capital. Shortly after a blustery PR-heavy entrance, the firm altered its ambitions and sold itself in a fire sale to GT Advanced Technology for $10 million.

 

5.) Nest Labs' Thermostat: Sexy? Yes. Functional? Maybe not.

I reported on the world's sexiest thermostat from Nest Labs with a bit of skepticism. Could a well-designed thermostat become a fetish item like the iPhone? I wrote, "It will be an enormous challenge for Nest to recreate the excitement of an entertainment product in a utilitarian device like a thermostat."

It looks like I might have been wrong.

When I last spoke with the Palo Alto, Calif.-based Nest, the firm noted an energy savings of 20 percent. That's the same as a conventional programmable thermostat -- but according to Nest, only 11 percent of owners use their thermostat correctly. Nest automates the process with some wireless data crunching and sensors. Reports from GigaOm claim an energy savings of 20 percent to 30 percent and sales volumes in the "hundreds of thousands." 

That sounds like a successful cleantech startup.

 

 

6.) The Networked Grid 100: The Movers and Shakers of the Smart Grid in 2012

Who are the leaders of the smart grid industry? Read this to find out.

 

7.) Candidate Romney’s Energy Plan

Mitt Romney accused the Obama administration of having an “unhealthy obsession with green jobs.” Unfortunately, for Romney, swing states with wind industries shared this same obsession, and that may have cost Romney some votes.

 

 

8.) MiaSolé Sold to China's Hanergy for $30 Million

MiaSolé, the most technologically and commercially advanced VC-funded CIGS thin film firm, sold to China's Hanergy for $30 million. MiaSolé has raised in the neighborhood of $500 million in VC funding since its founding in 2004. Investors included Voyageur Mutual Funds III, Kleiner Perkins, Firelake Capital, and VantagePoint Venture Partners. Board members include KP's John Doerr, Firelake's Marty Lagod, VantagePoint's Stephan Dolezalek, and Rob Chandra of Bessemer. 

 

 

9.) High Speed Test Drive of Tesla Model S

A not entirely true story of a Tesla Sedan test drive and subsequent jail term.

 

10.) Who Are the Top Ten Vendors in Smart Grid?

GTM Research profiles the leading 150 smart grid vendors