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US clean tech investment takes a nosedive
- 12 years ago (2011-08-09)
- Junior Isles
US venture capital investment in clean technology, including power generation, shrank 44 per cent to $1.1 billion during second quarter 2011 compared to the same period last year, according to analysis from Ernst & Young.
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The same period in 2010 saw record levels of investment topping $1.9 billion, primarily because of five large deals amounting to $978.6 million alone.
Although investment is down significantly compared with 2010, the number of actual deals during the quarter only fell by 12 per cent to 68 across the seven categories, showing that the scale of investment suffered most, according to Ernst & Young analysis.
Meanwhile, energy and electricity generation continues to dominate the clean technology sector, with $311.6 million invested during the quarter. Energy efficiency held up well – down only 3 per cent and ranking third with investment of $183.7 million.
Solar energy companies dominate the energy and electricity generation sector, representing 21 per cent of investment, with developer of solar thermal systems BrightSource Energy leading the way.
The energy storage market brought in $150.3 million, marking a 4 per cent increase from the same period last year.
Taking the largest hit was the alternative fuels sector, down 57 per cent on last year, although it did see one of the largest single deals of $55 million by hydrocarbon-based oil provider Kior.
Indicative of the cautious nature of the current market, Ernst & Young’s report finds that well-developed, revenue-generating companies attracted the greatest proportion of investment – 79 per cent in all – totalling $865.2 million.
Support also continues to filter in from the US government, with the Department of Energy providing loans and guarantees of more than $32 billion for 32 clean energy projects.
Ernst & Young also report that 11 wealthy US families have formed The Cleantech Syndicate to invest up to $1.4 billion over the next five years in renewable energy and energy efficiency companies at all stages of development.