Invested Development: clean tech

Showing posts with label clean tech. Show all posts

Friday, December 9, 2011

Weekly Review December 3-10

In honor of our upcoming event, Clean Tech That Matters, it’s only appropriate to report on articles discussing clean tech and alternative energy opportunities in emerging markets. Anytime you can get a group of ambitious techies, entrepreneurs, and investors in the same room, seeking extraordinary innovations in a time of favorable policy developments and continued market growth, it’s a time for celebration. If you like what you’re hearing, come find out more at Greentown Labs in Boston on Wednesday, December 14. Find out all the details here.

“Africa: €400 million being raised for renewable energy; 6.5 MW PV project underway” by Beck Stuart on PV Magazine

NextEnergy Capital is working to raise a fund for renewable energy projects in Africa. About 80% of the funds will be invested in infrastructure projects; the rest will be invested in early stage technologies with the goal of bringing them to the African market. The fund manager is already working with European Merchant Bank to develop a €18 million 6.5 MW photovoltaic project in South Africa. Check out the article to find out all the details on the investors and other plans for the fund.

“Power out of Africa” by Andrea Chipman on The Wall Street Journal

There’s no denying that Africa presents a huge opportunity for renewable energy development. The continent is described appropriately as a “blank canvas,” since infrastructure is currently unreliable or nonexistent. Meanwhile, renewable energy is increasingly cheaper, safer, and more efficient. In addition, most Africans are not connected to the grid and rely on diesel generators, costing them $1.00 per kWh, while solar PV power would only cost $0.20 per kWh. The difference in adoption usually comes down to the upfront expenditure cost differentials (PV is more costly upfront, but cheaper on an average cost of energy basis), which is why such solutions should be supported by government subsidies to promote adoption. An interesting article coming from the Wall Street Journal, it offers a great summary of renewable energy in Africa.

“African nations move closer to EU position at Durban climate change talks” by John Vidal and Fiona Harvey on The Guardian

Climate change talks are very relevant to clean energy development in emerging markets, as developing countries are holding higher stakes and having a greater influence. The UN’s Framework Convention on Climate Change in Durban, South Africa Conference of the Parties (COP17) wraps up this week. Propositions from COP17 include extending the Kyoto Protocol’s carbon reduction targets beyond 2012 and setting up “a new green fund ‘to keep Africa safe’ from climate change.” It’s very important that Africa plays a critical role in international talks as it is the continent that will be most deeply affected by climate change. The Guardian’s overview offers a great overview of the highlights from the talk so far, and we’re looking forward to seeing the outcomes. (NB. This is only the second time the COP has been held it Africa. It was held in Nairobi, Kenya in 2006).

“Econet to launch prepaid home ‘power station’” on TechCentral ZA

Econet Solar is a subsidiary of African mobile phone operator Econet Wireless. The subsidiary has launched a first-generation prepaid solar-powered home power station. It allows users to light their homes and charge their phones. Customers will pay for energy in a similar fashion to buying airtime. This is very similar to Simpa Networks’ Progressive Purchase Model, which actually allows users to work towards ownership. Both solutions overcome the financial barrier of the up-front cost of the system.

#CleanTechThatMatters is on December 14th.

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Friday, December 2, 2011

Weekly Review November 27-December 3

After last week’s regional focus on Africa, this week we focused our reading on social enterprise and development in Latin America.

“Latin America Report: Ready for Explosive Growth” on Renewable Energy World

Many Latin American nations are reducing their reliance on fossil fuels and by transitioning toward renewable energies like wind, solar, geothermal and biofuels. Wind energy prices are increasingly competitive, especially in Brazil, which are expanding so rapidly that wind farms may very overtake natural gas thermal plants in the next 5 years. With high hopes for solar, Renewable Energy World is launching a weekly report on Latin America. Watch out for in on Wednesdays.

“Rural Peru gets connected” by Mattia Cabitza on The Guardian Poverty Matters Blog

Revolutionizing life in Peru, where one in four people live without electricity, 130 rural communities are benefitting from the Euro-Solar Programme. The program reaches “more than 300,000 people whose communities are not connected to the electricity grid.” Each community received solar panels and the free EU kit, which allowed them to run dozens of electronics, including an antenna for satellite Internet. The investment of ~$47.6 million is also benefiting seven other Latin American nations.

“Survey shows confidence in SMEs amount banks in South America” on MicroFinance Focus

SMEs in South America will be crucial to the development of the region, according to a survey of 170 regional banks that are looking to increase their credit portfolio in the sector. This year, 89% of banks actively lend to SMEs, up 13% from 2008. This type of support and confidence in the SME sector helps foster entrepreneurship and continued growth in the region.

“Latin America poverty level lowest in 20 years, says UN” on The BBC

According to Eclac, the UN’s regional economic body, there are 177 million people living in poverty in Latin America. That’s 31.4% of the total regional population. The good news is that level is down from 1990, when 48.4% of the population lived in poverty. Poverty and inequality are on the decline, but to maintain this, there is a need for employment in high productivity sectors. See Eclac’s report for full details: Social Panorama of Latin America 2011 (PDF).

If you’re in Boston, don’t forget to sign up for our event #CleanTechThatMaters on December 14! Find out more here.
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Wednesday, November 16, 2011

In Boston? Interested in new opportunities for clean tech innovation?

Event Registration Online for Clean Tech That Matters - Meet Up at Greentown Labs with Invested Development and NCIIA powered by Eventbrite

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Friday, October 28, 2011

Weekly Review October 23-29

Several exciting headlines this week point to the adoption of clean tech as a affordable and scalable solution to the world’s energy problems.

“New Technology Could Double Solar Cell Efficiency” by RP Siegel on Triple Pundit

Although installed costs of solar photovoltaics have declined by over 43 percent since 1998, many who rely on fossil fuels are still reluctant to make the change to solar. Now, through advancement in the research and development of using so called “quantum dots”, several scientists at UT Austin have demonstrated how to increase solar panel efficiency from 31 percent to 66 percent, harnessing the previously illusive “hot energy” from the sun’s rays. These advanced developments and efficiency increases will likely drive down the costs, making solar energy more affordable for all.

“World Bank opens up $60m climate finance scheme to developing nations” on Business Green

A newly developed $60m fund by the International Finance Corporation will promote innovation in clean technology for emerging markets. Individual investments are expected to be in the range of $3 and $4 million. The fund will also support startups’ endeavors to reduce greenhouse gas emissions.

“Developing world ups ante in cleantech ‘arms race’” by Fiona Havey on The Guardian

Not surprisingly, the developing countries of the world are investing more and installing more clean technology than their counterparts in the developed countries. Specifically, China added 19GW of wind generating capacity, while India met targets of about 10GW. The Global Wind Energy Council wrote in its annual report that the demonstrated growth in wind capacity “puts an end to the assertion that wind power is a premium technology only for rich countries which cannot be deployed at scale in other markets.”

“Massachusetts Celebrates Green Technology with 2011 Clean Energy Week”

The Seventh Annual Conference on Clean Energy is happening in Boston on November 1. The Massachusetts Technology Transfer Center and The Massachusetts Hydrogen Coalition host the event as part of Massachusetts Clean Energy Week. Our own Miguel Granier is a panelist on “Energy Solutions for Developing Countries,” alongside Sam White, Co-Founder of our portfolio company, Promethean Power. Check out the agenda for all the details, including pitch sessions and lots of exciting panels.

“Selling Home Solar Like a Cell Phone Plan” by Brian Merchant on TreeHugger

It’s no secret that the two biggest obstacles to scaling clean technologies are cost and access. TreeHugger points out that it’s important to invest in renewable energy sources but also to experiment with pricing models that will allow people at all income levels to afford and access sustainable energy. Our portfolio company, Simpa Networks, tries to combat the financial barrier by allowing users to pay for energy just as they would with a mobile phone. Watch Brian Merchant’s interview with Paul Needham, Simpa Networks founder and a new PopTech Social Innovation Fellow.

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Friday, October 21, 2011

Weekly Review October 17-21

Source: Wikimedia Commons

This week we’re highlighting the importance of enterprise level development and impact investing in India. Several newsworthy excerpts describe the myriad opportunities emerging from the growth of social enterprises, impact investing, and the use of technology in the region.

“Could impact investing help India’s poor” by Shilpa Kannan on BBC News, Delhi

A massive existing population in India coupled with robust economic growth expectations and a changing investor appetite for disruptive innovation in emerging markets has driven growth in social enterprises opportunities. Impact investors are seeking cutting edge local entrepreneurs and business innovators in India for the development of the region. In late 2010, JP Morgan was one of the first to formally acknowledge that this sector is more than an emerging trend but rather a unique and emerging asset class all its own, a notion that supports the Times of India Social Impact Awards. As the article reports, it is becoming increasing clear that the potential and support for impact investing in India is huge. This investment class is both a solution for the risk-averse private sector and compliments the already exhausted resources coming from many governments and donors.

“Cheap tablet computer leads India’s drive to tackle rural poverty” by Charles Arthur on The Guardian

The Indian government is buying £30 tablets, the “Aakash,” from a British manufacturer, DataWind. The government will use the tablets to supply rural schools and universities with modern technology “to help lift villagers out of poverty.” This is an effort to get 220 million children of India online and close the gap between the burgeoning rich and the underserved poor. Currently, “only 7% of Indians graduate from high school” and the government aims to increase enrollment to 30% by 2020. DataWind tablets enable teachers to access important teaching resources and give students a taste of technology.

“How billions without electricity will benefit from clean energy” by Charles Kenny on Grist

“Just as many [governments] in developing countries skipped landlines and went straight to mobile phones,” many developing countries will also skip coal and go straight to clean energy. Clean technology and alternative energy sources are the competitive choice for under electrified countries in emerging markets. Especially in India, where the population is so large, the benefits of clean and safe energy sources will be significant. For example, there are about 2.5 million burn cases in India alone each year due to the use of kerosene lamps. Also in India, solar panels are priced around $300, the equivalent of a year’s supply of kerosene. Strengthened with innovative financing solutions like the Simpa Regulator Simpa Networks, India may reach its goal to produce 15% of its total energy from renewable sources by 2020. With the support of the public sector and the private sector, the second most populous country in the world can electrify the country with sustainable solutions.

“Aavishkaar raises $62 Million in Series D Funding” on Silicon India

Aavishkaar, a Mumbai-based venture capital firm, has raised a new $62 million fund that will focus on early-stage firms serving the base of the pyramid in India. In a similar fashion to Invested Development, Aavishkaar India emphasizes the importance of solutions that are affordable and scalable. The fund will serve a wide range of industries in India, including: healthcare, water and sanitation, education, agriculture, and renewable energy. VineetRai founded Aavishkaar in 2001 with the vision of enabling and harnessing the entrepreneurial spirit found at the base of the pyramid to promote sustainable and self-sufficient economic development.

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Friday, July 22, 2011

Weekly Review July 18 – 22

via unep.org

With the release of “Global Trends in Renewable Energy Investment 2011” from the UN Environment Program, many publications are lauding the $211 billion worth of global investment in renewable energy in 2010. The impact investing industry contributed to that number. This week, we looked at articles discussing the rising amounts of capital invested in clean tech and renewable energy, especially in developing countries.

“For The First Time, Developing Countries Spending The Most On Renewables” by Michael J. Coren via Fast Company
In 2010, developing countries propelled themselves “toward a future powered by clean renewables” like solar, geothermal, and wind “in parts of the world where they are often the only source of power available.” In 2010, “investors poured a record $211 billion into renewable energy in 2010… a 540% rise since 2004,” according to the new UNEP report. It’s remarkable that countries like Kenya, Pakistan, and Argentina are beginning to increase their energy accessibility, specifically with renewable energy. If our neighbors in the developing world can afford renewable energy, surely the developed world can do the same, especially considering that “the price of PV solar per megawatt has dropped 60% since mid-2008.”

“Renewable Energy Investments Set New Record, Up 32% in 2010” by Andrew Burger via Triple Pundit
Further to the fact that $211 billion was invested in renewable energy in 2010, $72 billion was invested in “faster-growing developing economies.” Notably, renewable energy investments were highest in China at $48.9 billion, followed by “$13.1 billion in South and Central America… $5 billion in the Middle East and Africa… $3.8 billion in India…. $4 billion in [other] Asian developing countries.” In addition to capital, research and development expenditures on renewable energy have increased globally. A combination of government policy and private equity are contributing to the electrification of rural markets along with sustainable economic development.

“A research revolution to save the planet” by Jonathan Glennie via The Guardian UK
The world is approaching the 7 billion population mark and global energy demands are increasing. At a climate change workshop held by the Asia Europe Foundation, Shell argued that “the world will need to be producing about twice as much energy in 2050 as we are today,” while lowering carbon emissions simultaneously. The obvious solution is clean tech, the only problem is the high expense when compared to dirty energy. Research and development propels technological advances and “if we were to invest more [in clean technology], progress would be rapid. It is the difference between having 1,000 university working on a problem instead of 100.” Developing countries have had the smallest impact on the environment, but are now adopting clean technology faster than the damaging, developed countries because any changes in the environment will dramatically affect their citizens. Consider India, where “300 million people live by the coast – a rise in sea level matters.” Investment in clean technology will proactively prevent poverty caused by climate change and actively combat poverty by increasing global access to energy.

“Unlocking investment in Africa: could private equity be the key?” by Yingni Lu and John Battersby via The Africa Report
More and more private equity funds are looking for African investments. In addition to less competition and good deals, African investments have significant potential for social impact, which appeals to impact investors like us. Additionally, “the average Africa fund performs as well as average global funds,” which appeals to investors of all types, whether impact driven or not. Investors and governments are seeking to utilize the growing investment in renewable energy for sustainable economic development. For example, South Africa has vowed to reduce carbon emissions with a set “target of 42% of new electricity generation to be met by renewable energy sources such as solar, wind, and wave-generation by 2030.” With a combination of government policy, foreign direct investment, and private equity, South Africa’s goal is very possible.

“Unprecedented success in Beijing paves avenues for impact investment” by Kevin Short via New Ventures
In the impact investing industry, it is often difficult to match entrepreneurs with the right impact investors and vice versa. New Ventures hosted an Investor Forum in China last month centered on “the region’s development towards becoming a vibrant hub of environmental entrepreneurship.” Social entrepreneurs came together to present and discuss business models and to connect with impact investors. The Investor Forum attracted many different types of clean tech businesses and “marked the intersection of environment and development in China.” New Ventures is responsible for connecting Chinese environmental entrepreneurs with $150 million in capital from impact investors. Following the success of the Investor Forum, “New Ventures is now considering facilitating creation of a China-based impact investment fund that directly targets SMEs in the environmental sector.” China will continue to lead the way as an example of increased investment in clean tech in the years to come.

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Friday, June 3, 2011

Weekly Review May 30-June 3

Every week at ID we read as many articles as we can on our favorite industry topics. In searching for an alternative energy BETA Resident, we’re studying the types of innovative clean technology solutions out there. In addition to a great product or technology, innovative business models and applications of the technology inspire us and are the topic of this week’s Weekly Review.

Photo Credit: Port of San Diego under Creative Commons

“The Clean-Tech Economy at the Base of the Pyramid” by Stuart L. Hart from The Conversation HBR Blogs

Hart laments that US companies aren’t taking advantage of the financial potential and social benefits of clean technology. Emerging markets like China, on the other hand, are producing affordable products that can “truly shift the market” to clean technology. In addition to environmental benefits, several Chinese companies are creating multi-billion dollar industries serving the poorest areas in China. For example, “Chinese solar companies like Tsinghua and Himin Solar” are providing energy access in underserved areas of China, thereby improving the lives of the citizens there. Hart gives class examples of business maintaining financial returns while also having a positive social and environmental impact. The US certainly does not lack the technology, but the business models, attitudes, and infrastructure that are already in place are difficult to change The Base of the Pyramid has an “advantage,” because new, innovative solutions can be introduced without disruption to current policies, systems, or infrastructure. We seek to invest in small, seed-stage companies with innovative energy solutions for the Base of the Pyramid. We hope it will serve as a model for US companies to follow and we’ll start to see more US based clean tech incubators like Greentown Labs.

“Scaling Green Energy Access from Millions to Billions” by Tom Boyd of Nokero via Ideas on Energy

Boyd offers a reality check: 1.6 billion people live without electricity and those that do, often only have access to unsafe and inefficient sources, most commonly kerosene lamps. Despite our efforts, the number of citizens actually using renewable energy in emerging markets is still too small. The solutions are highly effective, but are not quite reaching the necessary scale to increase access to safe and renewable energy. Boyd’s company Nokero offers solar light bulbs along with a “Power Panel” that can charge phones. In addition to a good product, social enterprises must have innovative business models to address the needs of the BoP as they are. Boyd outlines four innovative business models, including the benefits and challenges of each The four methods are: 1) the small enterprise approach, 2) the government subsidy approach, 3) the partial government subsidy approach, and 4) corporate, big-business approach. Our favorite is the small enterprise approach – market-based solutions that create micro-economies have both financial and social benefits for the investor, the entrepreneur, and most importantly, the customer. The customer usually saves money in the long-run from their investment and, using a solar light as an example, has access to safer and more efficient energy.

“Ashoka, Bamboo Finance, and the Canopus Foundation Join Forces to Launch Solar Energy Fund for Developing Countries” Press Release via Ashoka

The “Oasis Energy – Solar for All Fund” seeks to invest in social enterprises that provide affordable solar energy solutions in sub-Saharan Africa, India, South East Asia, and Central & Latin America. The Fund has been raised by the Solar for All (SfA) Initiative, launched by Ashoka and the Canopus Foundation. Bamboo Finance of the Blue Orchard Group has come on board to serve as the Fund’s investment advisor. The SfA Initiative’s objective is to bring “affordable solar power to 60 million off-grid households by 2020.” Now, with the Oasis Energy Fund, the SfA Initiative has become an impact investor for social enterprises.

“One Laptop Per Child Weights Going For-Profit” By Mary Moore from Boston Business Journal

One Laptop Per Child is currently a non-profit with an innovative product in developing countries. Developed close to home in the MIT Media Lab, the laptops they offer are powered by solar energy or by pulling a chain which creates energy. They are durable and able to sustain everything from a child’s usage to the climate’s harsh conditions. As we’ve said before, an innovative product isn’t enough. Non-profits have great missions and intentions. However, shifting part of the business to for-profit would allow OLPC to distribute more laptops and could create leasing arrangements with governments to allow the laptops to reach more children. As a for-profit social enterprise, OLPC’s business model will have a greater reach and will be able to source more innovative technological solutions to global poverty.

“Mexico Advances Renewable Goals But ‘Much More’ Could Be Done” by Ivan Castano from Renewable Energy World

Mexico and Latin America include many of the world’s poorest citizens with a huge potential for clean energy. Greenpeace said Mexico “could satisfy 95% of its electricity requirements from green energy by 2050 and 42% by 2015.” Some alternative energy options for Mexico are wind, geothermic, nuclear, hydraulic, and solar. According to the article, wind energy will lead the clean tech revolution in Mexico. There are also many biogas projects planned. Surprisingly, solar is overlooked. The weak commitment to alternative and renewable energy may be due to the perceived high costs and a commitment to oil and natural gas production. The government is planning to build several nuclear power stations, citing that a disaster like the one in Japan is unlikely to happen in Mexico, but without realizing the real risings costs of nuclear power. The government doesn’t realize the social benefits of energy access, and that the costs of renewable energy are decreasing or can be innovatively priced.

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Friday, May 20, 2011

Weekly Review May 16-20

This Weekly Review focuses on the economic and social opportunities in renewable energy and clean technology, especially within emerging markets to better the lives of the world’s poorest citizens.

SELCO solar panels in India at Simpa Site Visit

“Mobile Phones to Use Noise from Your Conversations to Charge Low Batteries” by Jaymi Heimbuch on TreeHugger

We know that there’s a certain connection between mobile technology and alternative energy, which is why they are our investment focus. Researchers at the Texas A&M and University of Houston are studying piezoelectric material that could harvest sound waves for energy. Researchers at a Korean university are studying particular ways to harvest sound waves that are abundant in urban environments. So far, tests show that “100 decibels of sound can generate 50 millivolts of electricity,” which is perfect for charging cell phones during conversations. Harvesting the sound energy from traffic has the potential to produce abundant clean energy, but would require extensive urban planning. The article reports that harvesting sound energy is still in its early stages, but something to look out for in the future. Capitalizing on energy that is readily available and potentially highly affordable will be beneficial to the poor populations in urban areas.

“Renewable Energy Can Power the World in 40 Years: IPCC” by Brian Merchant on TreeHugger

It’s clear that the global community needs to find sustainable and renewable energy sources before we run out of oil or do any more environmental damage. In order for this to happen, change is necessary. Realistically, people and, more importantly, companies won’t change their energy consumption habits unless the government requires them to do so. With some governmental policy, the Intergovernmental Panel on Climate Change reports that “the world can get 80% of its power from renewable sources by 2050.” This includes everywhere from the US to Tanzania (where EGG-energy operates), to India (where Promethean Power and Simpa Networks operate). The report from the Intergovernmental Panel on Climate Change offers many great stats, including “the investment that will be needed to meet the greenhouse gas emissions target demanded by scientists is likely to amount to $5 trillion in the next decade, rising to $7 trillion from 2021 to 2030. “ What the article doesn’t touch upon, however, is that many investments will come from impact investors who have social goals beyond those that are simply environmental. Impact investors' contributions will promote economic development and improve citizens’ lives in emerging markets. Clean energy and technology in emerging markets can do more than save the environment (which is important, too). Investing in renewable energy in emerging markets can create jobs and provide products and services that the people there need to get an education or overall better their lives.

“Emerging markets lead in energy growth,” by Aya Lowe on Gulf News

ExxonMobil’s latest Energy Outlook Report states that global energy demand “will be up 35 per cent in 2030 compared to 2005.” What’s interesting is that the demand coming from countries outside of the Organization for Economic Cooperation and Development (OECD) will “increase by 70 per cent in 2030.” See here for a complete list of OECD member countries. Non-OECD countries include India, all of Africa and most of South America. In other words, the three major areas where we seek to invest. Furthermore, “the types of energy consumed [are] also forecast to change in the coming years,” and we’re confident that the switch will be towards renewable in both developed and developing countries.

“Global alliance seeks to promote renewable solutions for rural electrification” by Eleanor Seggie on Engineering News

Simon Rolland is the secretary-general for the Alliance for Rural Electrification. He argues (and we agree) that people in Africa need to turn towards renewable energy sources. However, as we’ve noted before, there are many challenges for the social entrepreneurs who try to bring renewable energy to rural regions. The Alliance for Rural Electrification helps to alleviate some of those challenges by developing key recommendations for companies or those involved in the renewable energy sector “to guide governance and decision makers.” Rolland says, “Markets must be shaped according to the needs of the private sector because the first needs in developing countries are for reliable technologies, suitable business models and investment.” The Alliance believes that energy access in rural areas will contribute to sustainable development and progress. Here at ID, we seek to invest in those very companies that aim to electrify rural areas.

“How Start-Ups Will Lead the Clean Tech Revolution” by James Parle from Presidio Graduate School’s MBA program on Triple Pundit

Clean tech is one of the “fastest growing sectors in the economy.” Parle points out that GE’s Ecomagination foreshadows that “start-ups and not large corporations will lead the clean tech revolution.” More specifically, small start up social enterprises like those in our portfolio and clean tech incubators like our friends at Greentown Labs will have maximum impact and the greatest influence in the clean tech revolution. The most successful clean tech incubators, Parle notes, are those that operate with sustainable business practices with a triple bottom line: people, planet, profit. A combination of investors who are willing to offer patient capital and sustainable clean tech incubators will lead the clean tech revolution both in the US and in emerging markets.

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