El Paso Solar Energy Association - EPSEA

As Michael Kanellos reported, recent greentech IPOs have had mixed and less than stellar results.  And we've looked at many of the greentech IPO prospects in the past.

The public market regurgitated Solyndra, unable to squeeze that debt level and fragile value proposition down its craw.  The shiny bolus of Tesla has been swallowed, although that firm's value proposition has not been fully digested or priced.  

I'll stop with the alimentary metaphors for now. 

Here's a rundown of Greentech IPOs that have already priced or been withdrawn, the ones currently on deck with their S-1s filed, and some wild prognostications about who the next IPO candidates might be. 

If there's a running theme here, it's that this first crop of Greentech IPOs has stunk up the room -- but there are likely some higher-quality IPOs to come.

Withdrawn Greentech IPOs

• Trony Solar just withdrew its planned IPO, about six months after the Shenzen, China-based PV module maker postponed its original IPO plans.  J.P. Morgan Chase & Co. and Credit Suisse Group were the lead underwriters for the amorphous silicon solar panel vendor.  Investors included Intel, which owned about 5 percent of the firm.
• Solyndra, recipient of $1 billion in VC and $500 million in government loan guarantees, could not convince institutional investors that their manufacturing costs could keep up with the solar market leaders or that profitability was remotely achievable in the near- to mid-term.  We haven't heard the last of Solyndra, but it might be a while until they can try the public markets again.

Greentech IPOs Past: Only a Few Winners

(stock prices as of 8/11/10)

If the mark of success is in exceeding the IPO strike price -- then only Tesla and Jinko meet that test.

• It's too early to tell with Tesla -- they have first mover advantage and certainly the stock will be volatile in the coming year.  Let's check back in a year when hybrids and EVs from Chevy, Nissan, BYD, Hyundai, Fisker, Porsche (more Porsche here), Mercedes, BMW and VW start to reach the market. 
• A123 has its share of challenges ahead.  The firm just announced that it lost Chrysler as a customer and missed its revenue estimates.  And recent news of spinning out a flow battery subsidiary doesn't seem like a vote of confidence for lithium-ion in large-scale utility storage applications.
• GT Solar's most recent quarter was mostly positive with earnings beating estimates, a very healthy backlog of $1.1 billion and good visibility into 2011 for the solar manufacturing equipment vendor.

 

Greentech IPOs Present - SEC documents Filed

PetroAlgae

• Last week saw paperwork for the proposed $200 million offering from biofuel player PetroAlgae.  The firm actually no longer grows algae (it grows lemna or duckweed) and has no intention of supplying petroleum, despite their name. The company has a technology licensing business plan, zero dollars in revenue and a management team with a spotty record.  It's only operation is a small-scale demo facility in Florida.  In a questionable algae biofuels market, PetroAlgae is not the company to inspire confidence in institutional investors.  Here's the S-1.  Prediction: IPO withdrawn "because of market conditions." 

(GTM Research has a research report on third and fourth generation biofuels here).

 

SemiLEDs

• SemiLEDS is an LED chip and component manufacturer that filed its S-1 registration this week.   According to the filing, the company is looking to raise $172.5 million from the offering.  The firm builds blue, green and UV LED chips for general lighting applications, including street lights and commercial, industrial and residential lighting.   The company had $24.275 million in revenues and -- get this -- $6.3 million in profit in the nine months ending May 31, 2010.  That's up from revenues of $7.01 million and losses of $2.707 million for the same period last year.  It's the only profitable company on this list.

 

Fallbrook Technologies

• Fallbrook Technologies of San Diego, a startup building an innovative transmission for vehicles and wind turbines, filed for a $50 million IPO back in February.  Here's their S-1.  Fallbrook has developed a transmission that improves the efficiency and performance of mechanical systems that run at different speeds between primary drive and operating drive.  Here's a link to a video that explains their technology. The startup identifies several multi-billion dollar markets for its NuVinci transmissions: automotive accessory drives, bicycles, electric vehicles, etc. Fallbrook claims its transmission improves EV battery life and increases operating range in applications such as lawn care equipment and small wind turbines. The firm has received $55 million in venture funding since its founding in 2000 and its largest shareholders are NGEN and Robeco. This might be a tough sell to institutional investors.

 

Amyris

• Amyris feeds sugars to custom microbes, which in turn exude hydrocarbons that are then converted to fuels or industrial chemicals.  The first product out of the company was an artificial version of artemisinin, an antimalaria drug that drew millions in support from the Bill and Melinda Gates Foundation.
• Here are the real kickers in the list of investment risks: The company has no experience producing products at the commercial scale, they have no production agreements, they have a limited operating history and have not generated revenues from the sale of any of their renewable products.  To date, their revenues have consisted of sales of ethanol produced by third parties, funding from third-party collaborative research services and government grants. That would make them a distributor -- a money-losing distributor.  And a grant mill.
• The company had 2007 sales of $6.1 million, 2008 sales of $13.9 million and 2009 sales of $64.6 million.  The company lost $11.7 million in 2007, $41.8 million in 2008, and a whopping $64.4 million in 2009.   To date, Amyris’ cumulative deficit stands at $120.4 million.
• The company genetically modifies microorganisms, primarily yeast, and uses them "as living factories in established fermentation processes to convert plant-sourced sugars into potentially thousands of target molecules." Their first commercialization efforts have been focused on a molecule called farnesene, the basis for a range of products varying from specialty chemical applications such as detergents, cosmetics, perfumes and industrial lubricants, to transportation fuels such as diesel. 
• Here's the link to the S-1. The synthetic biology firm has raised more than $244 million in private funding from Kleiner Perkins Caufield & Byers, Khosla Ventures, TPG Biotechnology, Advanced Equities, DAG Ventures, Grupo Cornélio Brennand, Naxos Capital Partners, The Westly Group, Stratus Group, and Temasek Holdings, et al. and is looking to raise $100 million.   (GTM Research has a research report on third and fourth generation biofuels here).

 

Gevo

• Biobutanol producer Gevo is looking to raise up to $150 million led by underwriters UBS Investment Bank, Goldman Sachs, and Piper Jaffray.  Here's a link to the S-1. Gevo has raised more than $40 million in funding from Burrill & Co., Malaysian Life Sciences Capital Fund, Khosla Ventures, Lanxess and Virgin Green Fund.  Khosla Ventures is the leading share holder at more than 40 percent. 
• Gevo had a mere $660,000 in revenue in 2010 -- hardly IPO material.  Until this month, that is, when Gevo acquired 18-million-gallon-per-year ethanol producer Agri-Energy.  With that acquisition, Gevo suddenly has $40.7 million in revenue, with losses of $18.2 million. Gevo is working on a fermentation process to produce isobutanol from the fermentable sugars in cellulosic biomass. Isobutanol is a building block for making biodiesel, jet fuel and other materials.  The S-1 estimates the global market for isobutanol as more than a trillion gallons per year.  (GTM Research has a research report on third and fourth generation biofuels here.)
• Gevo's strategy, according to their S-1, "is to commercialize biobased alternatives to petroleum-based products using a combination of synthetic biology and chemical technology." They "intend to produce and sell isobutanol, a four carbon alcohol. Isobutanol can be sold directly for use as a specialty chemical or a value-added fuel blendstock. It can also be converted into butenes using simple dehydration chemistry deployed in the refining and petrochemicals industries today. Butenes are primary hydrocarbon feedstocks that can be employed to create substitutes for the fossil fuels used in the production of plastics, fibers, rubber, other polymers and hydrocarbon fuels. Customer interest in our isobutanol is primarily driven by its potential to serve as a building block to produce alternative sources of raw materials for their products at competitive prices." 
• Rob Day refers to this IPO as a venture capital/project finance fundraising and "not your classic IPO liquidity event" -- along with some more insight here.

 

And Future: Top Ten Greentech IPO Hopefuls

Here's where it gets interesting.  Unlike most of the previously listed (and frankly, rather questionable) firms, the list of companies to follow actually have real products, serious revenue and the prospect of profits in high-growth markets.  Here's a list of ten potential greentech IPOs coming in late 2010 through 2012:

Bloom Energy has a great story, revenue from the sales of its Bloom Boxes and marquee customers including Cypress, Google, FedEx and San Francisco's SFO Aiport.  The company's Solid Oxide Fuel Cells (SOFCs) are an alternative to diesel gen-sets in the off-grid world and to the electric grid in the developed world.  The fuel cells run on natural gas which, in the view of some, makes the value proposition fragile.  But a strong team, veteran investors and a big narrative make this a firm to watch, profitability and value proposition notwithstanding.

Bridgelux has emerged from the pack of LED startups with a solid product roadmap and a CEO (Bill Watkins) familiar with the scale-up issues surrounding tech companies.  The firm is aiming at the commercial market, avoiding the coming residential bulb bloodbath. Still, Bridgelux must compete against Philips, Osram, GE and other companies with over 100 years of experience and mature sales channels all over the world.  Reliable sources at the Director level inform us that revenue is in the high tens of millions.

BrightSource Energy is the leader in the solar thermal startup world, now that the Ivanpah CSP plant has been given the green light.  That's hundreds of megawatts of power under contract and gigawatts of power in the pipeline.  An enormous $1.37 billion federal loan guarantee has been won and investors, developers and EPC personnel are in place.  But revenue doesn't flow until power flows, which explains why the company is looking at Thermal Enhanced Oil Recovery (TEOR) as a shorter term revenue source.

Enphase has shipped more than 300,000 of their microinverters, carved out more than a 10 percent U.S. market share in Q1, according to the CEO, and has a strong balance sheet -- partially from a recent funding infusion from Kleiner Perkins. The inverter and microinverter market is growing fast and Enphase is the microinverter leader.  Reliability issues seem to have been addressed, although gross margin questions remain.  The company has made a tentative foray into the consumer-facing smart grid with an automated thermostat, looking to leverage their platform into other markets.

Intematix produces a product that makes LEDs work.  Their phosphor materials enable LEDs for general illumination to achieve good quality light and efficiency.  Reliable sources indicate that the company is generating revenue in the "tens of millions."  What's more, the LED lighting market seems to be poised at an interesting tipping point.

OPower is an energy efficiency company focused on customer engagement and behavior modification, currently providing millions of homes with in-home energy data and efficiency advice via paper reports or online.  The platform is described as advanced customer engagement.  The firm says about 85 percent of their customers will cut power consumption by around 3.5 percent. The customized data lets people know much energy they're using in comparison to their neighbors and then follows it up with a recommended course of action to maximize energy savings.  Revenues exceed $30 million according to sources at the firm.

Serious Materials has yet to build a commercial-scale factory for its green drywall, but is selling tens of millions' worth of thermal windows. Rumors are that it will try next to move into other markets for building products, such as insulation and home management controls.  CEO Kevin Surace has talked about this for years, and an IPO would give him the cash to expand.  2009 revenue was reported in the $50 million range.

Silver Spring Networks' S-1 filing is rumored for the fall of this year.   Silver Spring has won multimillion dollar contracts in California, Texas and Australia for the mesh networking systems that connect meters to utilities.  They've hit a few speed bumps with the PG&E smart grid backlash and there are profitability concerns, but the revenue bar seems to have been reached to allow serious consideration of the public offering.

Solar City has raised $60 million in tax-equity financing from PG&E, a $90 million fund with U.S. Bancorp and the backing of premier VCs.  The firm started its existence looking to add efficiency to the solar installation process.  It then moved into financing and leasing the solar systems for residential rooftops, and it has just added energy efficiency services to its competencies through its acquisition of Building Solutions.  It has significant revenues from its operations in Arizona, California, Colorado, Oregon and Texas, but, like other service industries, the company is faced with the challenge of how to efficiently and profitably scale the business.

Suniva, as reported by GTM Research analyst Shyam Mehta, began commercial production of its monocrystalline cells in late 2008, and "unlike many struggling PV startups that entered the market around that time, the company has gone from strength to strength over the last 18 months,"  with "one of the quickest production ramps of any Western PV company."  Suniva went from an initial 32 megawatts to 96 megawatts to a current 170 megawatts of cell capacity, and is sold out for 2010.  The company has its own paste and texture recipes, is able to customize and optimize every layer of the cell design to its own specifications, and has leveraged its considerable R&D experience to optimize each processing step to a high degree.  While Suniva is clearly not going to overtake SunPower or Sanyo any time soon, reports suggest that the company has a much better cost structure compared to these two players, one that is more in line with low-cost manufacturers. That, combined with its current efficiency advantage over other firms, makes it competitively positioned for right now. A 19-percent efficiency cell is in the works and that should help the firm maintain competitiveness in the near future, as well. "The key question is whether the company can maintain this advantage going forward, given that major Chinese players are hell-bent on playing catch-up," according to Mehta.

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Michael Kanellos contributed to this article.

After spending more than a year at a less-than-impressive two-star rank, Ford (NYSE: F) has impressed enough top-performing members of our 165,000-strong Motley Fool CAPS community to climb up to a more palatable three stars. A total of 9,598 members have given their opinion on the auto maker, with many of them offering analysis and commentary explaining the recent optimism.

CAPS members like the progress that Ford has made in working its way through the financial crisis and believe it's on the right track for more profits. The company reported better-than-expected second-quarter earnings with profits in every geographic region, and even forecasts a profitable 2010 with a further increase in 2011. Along with U.S. peers General Motors and Chrysler, Ford started the third quarter with positive U.S. July sales gains, setting it apart from the declines at Japanese rivals Toyota (NYSE: TM) and HondaHMC). July sales also rose more than four-fold in India where all-time-high car sales helped boost sales for (NYSE: Tata MotorsTTM), leaving investors bullish on Ford's plans to expand in India and other markets like China and Japan. (NYSE:

The Detroit carmaker also significantly reduced its debt in the quarter and expects to continue paying down more, which, along with its strong profits, earned it an upgraded credit rating from both Standard & Poor's and Fitch. Ford is also aiming to regain its investment grade rating in the next couple of years.

Ford is also working closely with parts suppliers like TRW and Johnson Controls (NYSE: JCI) to increase efficiency. By simplifying its parts and using more common parts across multiple regions and models, the company is reducing costs that helps boost margins and hence increase its competitiveness.

Investors also see good potential in Ford's shift to greener cars. While other carmakers are pushing into the electric vehicle space -- such as Tesla (Nasdaq: TSLA), who aims to introduce its electric sedan by 2012 -- Ford has plans for a couple of plug-in models in the next couple of years like the Focus. It's already working with Microsoft to utilize its Hohm energy management application for recharging the cars as well.

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This article was originally published by The Motley Fool.

Greentech Media editors and GTM Research analysts are working with GE on their ecomagination website by posing important questions about renewable energy, smart grids and other important industry topics. Each week GTM will be posing a new question and getting involved with the conversation that follows. The first question, posed by GTM Research smart grid analyst, David Leeds, is, "Why Don't Consumers Get The Smart Grid?".

From the article:

"To utilities, a smarter grid will lay the foundation for technologies that seemed outlandishly futuristic a few years ago: electric cars, cities that can insulate themselves from rolling blackouts, homes automatically tuning themselves to the weather and alternative energy that can compete economically with coal.

But to consumers, the smart grid so far is an extra charge on their bill they don’t particularly like."

Read the rest of David's article and join the discussion on Ecomagination's website here.

Biobutanol producer Gevo just filed its S-1 registration statement with the SEC for its IPO. The company is looking to raise up to $150 million led by underwriters UBS Investment Bank, Goldman Sachs, and Piper Jaffray.  Here's a link to the S-1.

Gevo has raised more than $40 million in funding from Burrill & Co., Malaysian Life Sciences Capital Fund, Khosla Ventures, Lanxess and Virgin Green Fund.  Khosla Ventures is the leading share holder at more than 40 percent.

Gevo had a mere $660,000 in revenue in 2010 -- hardly IPO material.  Until this month that is, when Gevo acquired 18-million-gallon-per-year ethanol producer Agri-Energy.  With that acquisition, Gevo suddenly has $40.7 million in revenue, with losses of $18.2 million.

Gevo is working on a fermentation process to produce isobutanol from the fermentable sugars in cellulosic biomass. Isobutanol is a building block for making biodiesel, jet fuel and other materials.  The S-1 estimates the global market for isobutanol as more than a trillion gallons per year.

We'll bring you more info in the coming days, but for now, here are some highlights from the S-1:

Highlights from the S-1

Gevo is "a renewable chemicals and advanced biofuels company. Our strategy is to commercialize biobased alternatives to petroleum-based products using a combination of synthetic biology and chemical technology. In order to implement this strategy, we are taking a building block approach. We intend to produce and sell isobutanol, a four carbon alcohol. Isobutanol can be sold directly for use as a specialty chemical or a value-added fuel blendstock. It can also be converted into butenes using simple dehydration chemistry deployed in the refining and petrochemicals industries today. Butenes are primary hydrocarbon feedstocks that can be employed to create substitutes for the fossil fuels used in the production of plastics, fibers, rubber, other polymers and hydrocarbon fuels. Customer interest in our isobutanol is primarily driven by its potential to serve as a building block to produce alternative sources of raw materials for their products at competitive prices. We believe products made from biobased isobutanol will be subject to less cost volatility than the petroleum-derived products in use today. We believe that the products derived from isobutanol have potential applications in approximately 40% of the global petrochemicals market, representing a potential market for isobutanol of approximately 67 BGPY, based upon volume data from SRI, CMAI and Nexant, and substantially all of the global hydrocarbon fuels market, representing a potential market for isobutanol of approximately 900 BGPY, based upon volume data from IEA. When combined with a potential specialty chemical market for isobutanol of approximately 1.1 BGPY, based upon volume data from SRI, and a potential fuel blendstock market for isobutanol of approximately 40 BGPY, based upon data from the IEA, the potential global market for isobutanol is approximately 1,008 BGPY.

We also believe that the raw materials produced from our isobutanol will be drop-in products, which means that customers will be able to replace petroleum-derived raw materials with isobutanol-derived raw materials without modification to their equipment or production processes. In addition, the final products produced from our isobutanol-based raw materials will be chemically identical to those produced from petroleum-based raw materials, except that they will contain carbon from renewable sources. We believe that at every step of the value chain, renewable products that are chemically identical to incumbent petrochemical products will have lower market adoption hurdles, as the infrastructure and applications already exist. 

Strategy

Our strategy is to commercialize our isobutanol for use directly as a specialty chemical and value-added fuel blendstock and for conversion, into plastics, fibers, rubber, other polymers and hydrocarbon fuels. We intend to drive further adoption of our isobutanol in multiple US and international chemicals and fuels end-markets by offering a renewable product with superior properties at a competitive price. In addition, we intend to leverage existing and potential strategic partnerships with hydrocarbon companies to accelerate the use of isobutanol as a building block for drop-in hydrocarbons. This strategy will be implemented through direct supply agreements with leading chemicals and fuels companies, as well as through alliances with key technology providers.

Markets

Relative to petroleum-based products, we expect that chemicals and fuels made from our isobutanol will provide our potential customers with the advantages of lower cost volatility and increased supply options for their raw materials. Our isobutanol, and the products produced from it will also offer our potential customers the additional benefit of being able to market their products as environmentally sensitive.

Our initial commercialization efforts are focused on the following markets:

Isobutanol. Without any modification, isobutanol has applications as a specialty chemical and a fuel blendstock. In the fuel blendstock market, isobutanol can be used to replace high value blendstocks such as alkylate and can be blended in conjunction with, or as a substitute for, ethanol and other widely-used fuel oxygenates. Our estimate of the global market for isobutanol as a gasoline oxygenate is approximately 40 BGPY, based upon data from the IEA. While isobutanol can be used as a replacement for ethanol, its product properties are significantly differentiated from ethanol. As a gasoline blendstock, isobutanol’s low vapor pressure, high energy content and low water solubility versus ethanol make it a valuable product that can be sold directly to refiners and is expected to be compatible with existing engine and industry infrastructure, including pipeline assets. Isobutanol can also be sold for immediate use as a solvent. This global market for butanol represents approximately 1.1 BGPY, based upon volume data from SRI. Combined, the total global market for isobutanol as a fuel blendstock and specialty chemical represents approximately 41.1 BGPY.
 
Plastics, Fibers, Rubber and Other Polymers. Isobutanol can be converted by our potential customers into a wide variety of hydrocarbons, which form the basis for the production of many products, including: rubber, lubricants, additives, methyl methacrylate, polypropylenes, polyesters and polystyrene, representing an aggregate potential market for isobutanol of approximately 67 BGPY, based upon volume data from SRI, CMAI and Nexant.

Hydrocarbon Fuels. The hydrocarbons that can be produced from isobutanol can be used to manufacture specialty gasoline blendstocks, jet and diesel fuel, as well as other hydrocarbon fuels. The hydrocarbon fuels that can be produced from isobutanol collectively represent a potential market for isobutanol of over 900 BGPY, based upon volume data from IEA. 

Partners include Lanxess, Total, Toray Industries, United Air Lines and CDTECH.

Competitive strengths

The Gevo Integrated Fermentation Technology (GIFT) demonstrated at commercially relevant scale. “We have completed the retrofit of a 1 MGPY ethanol facility and successfully produced isobutanol at this facility using our first-generation biocatalyst, achieving our commercial targets for concentration, yield and productivity…Also, we believe that our entry into the acquisition agreement with Agri-Energy demonstrates the readiness of our technology for commercial deployment and supports our plan to commence initial commercial-scale isobutanol production in the first half of 2012.”

Competitors

Significant competitors in these areas include Codexis, Inc., which is engaged with Equilon Enterprises LLC dba Shell Oil Products US, or Shell, in a research and development collaboration under which they are developing biocatalysts for use in producing advanced biofuels; Novozymes A/S, which has partnered with a number of companies and organizations on a regional basis to develop or produce biofuels, and recently opened a biofuel demonstration plant with Inbicon A/S of Denmark; Danisco A/S/Genencor, which has formed a joint venture with E.I. Du Pont De Nemours and Company, or DuPont, called DuPont Danisco Cellulosic Ethanol LLC, and is marketing a line of cellulases to convert biomass into sugar; Royal DSM N.V., which received a grant from the US Department of Energy to be the lead partner in a technical consortium including Abengoa Bioenergy New Technologies, Inc., and is developing cost-effective enzyme technologies; Mascoma Corporation, which has entered into a feedstock processing and lignin supply agreement with Chevron Technology Ventures, a division of Chevron USA., Inc.; and BP, p.l.c., or BP, which has purchased Vercipia Biofuels, LLC and technology from Verenium Corporation to develop a commercial-scale cellulosic ethanol facility. Range Fuels, Inc. is also focused on developing non-biocatalytic thermochemical processes to convert cellulosic biomass into fuels, and Coskata, Inc. is developing a hybrid thermochemical-biocatalytic process to produce ethanol from a variety of feedstocks.

In the production of cellulosic biofuels, key competitors include Shell Oil, BP, DuPont-Danisco Cellulosic Ethanol LLC, Abengoa Bioenergy, S.A., POET, LLC, ICM, Mascoma, Range Fuels, Inbicon A/S, INEOS New Planet BioEnergy LLC, Coskata, Archer Daniels Midland Company, BlueFire Ethanol, Inc., KL Energy Corporation, ZeaChem Inc., Iogen Corporation, Qteros, Inc., AE Biofuels, Inc. and many smaller start-up companies. If these companies are successful in establishing low cost cellulosic ethanol or other fuel production, it could negatively impact the market for our isobutanol as a gasoline blendstock.

Additionally, DuPont has announced plans to develop and market isobutanol through Butamax Advanced Biofuels LLC, or Butamax, a joint venture with BP. A number of companies including Cathay Industrial Biotech, Ltd., Green Biologics Ltd., METabolic Explorer, S.A., TetraVitae Bioscience, Inc. and Cobalt Technologies, Inc. are developing n-butanol production capability from a variety of renewable feedstocks. Academic and government institutions may also develop technologies which will compete with us in the blendstock market.

 

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More analysis in the days to come as we peruse the S-1.  Stay tuned.

 

 

As the U.S. wind industry's installed capacity went from 6.7 megawatts to 35,000 megawatts between 2004 and 2009, its manufacturing sector expanded from a few dozen facilities to more than 240. By 2009, over 60% of wind's U.S. capacity was sourced domestically. This is a growing ecosystem supporting U.S. middle-class labor as well as capacity to generate emissions-free electricity.

"For wind turbines, which have large components like towers, nacelles and blades," according an American Wind Energy Association (AWEA) spokesperson, "transportation is a big part of the cost."

In fact, according to the recent report Harnessing the Potential of Open Trade...in the Wind Energy Industry from the World Resources Institute, off-shoring wind industry manufacturing to places where labor is cheap has no significant cost benefit over domestic manufacturing because of transport costs. The U.S. wind manufacturing base can, therefore, be expected to grow as long as the industry does.

California-based Clipper Windpower, for instance, opened a manufacturing facility in 2006, captured one percent of the turbine market in 2007, moved up to six percent in 2008 and, in 2009, exported its first turbines, to Mexico.

According to the just-released 2009 Wind Market Report from Lawrence Berkeley National Laboratory, a contemporary wind turbine averages about two megawatts in capacity, or enough power for almost 500 U.S. homes. According to Winds of Change; A Manufacturing Blueprint for the Wind Industry from AWEA, the Blue-Green Alliance and the United Steelworkers, the average turbine weighs 200 to 400 short tons, 90 percent of that in steel and most of the rest in fiberglass, copper, concrete, aluminum and adhesives. It has about 8,000 components, many already manufactured domestically in smaller versions for aerospace, defense, energy and mining.

The five U.S. turbine manufacturers in operation in 2005 grew to fifteen in 2009. Nine of 2009's top ten original equipment manufacturers (OEMs) -- Acciona, Clipper, GE, Gamesa, Mitsubishi, Nordex, Siemens, Suzlon, Vestas -- have current or announced U.S. facilities for towers, blade manufacturing, or nacelle assembly.

At least three factors, according to the manufacturing report, are driving the growth of domestic manufacturing. First, eliminating the expense of transporting very large turbine parts offsets the higher cost of domestic labor. Second, imports that require dealing with currency fluctuations can often disadvantage the U.S. dollar. Third, the high cost of inventory and rapidly developing technology makes just-in-time manufacturing necessary -- and proximity preferences domestic manufacturers.

Due to transport costs, the biggest, heaviest components were the first to be made domestically. Twenty U.S. facilities presently manufacture utility-scale turbine towers. Fourteen have come online since 2005 and eight more have recently been announced. Thirteen U.S. facilities presently make turbine blades, nine of which came online since 2005. Three are announced.

The second wave of expansion was in the assembly of the nacelle, the heart and brain of a wind turbine. The majority of U.S. nacelles are assembled at eight domestic facilities. There are eight more such facilities in planning stages.

Most recently, an expansion in the manufacture of the highly engineered mechanical and electrical nacelle internals has begun.

Each wave of expansion swept in a supply chain of nuts, bolts, grease and adhesives makers. By 2009, component manufacturing had become the biggest growth sub-sector.

The three major nacelle internals are gearboxes, generators, and drives. The first U.S. facility dedicated to such manufacturing, Winergy Drive Systems in Elgin, IL, came online in 2009. Among the many facilities in planning stages, Germany's internationally recognized mechanical system maker ZF announced a contract with Vestas, the world's biggest turbine manufacturer, to provide gearboxes from a Gainesville, GA, facility now under construction.

The U.S.'s wind manufacturing ecosystem extends from coast to coast and border to border. There are online or planned facilities in rust belt states like Michigan and Ohio, Midwest states like Kansas and Iowa, where youthful rural populations now have an alternative to moving to urban centers for opportunity, and in Southern states like Texas and Arkansas, where manual labor now has an alternative to unemployment.

An example of the potential to revitalize U.S. manufacturing is the urgent need to develop new domestic foundry capacity for casting utility-scale turbine parts. Few existing foundries are up to the demands of casting mainframes, hubs, rotor shafts and other parts that can weigh 30 tons or more. This is expected to be a huge investment opportunity.

But no such foundry capacity expansion has so far been undertaken, according to AWEA, because federal policy has failed to provide a long-term signal warranting the needed substantial investment. AWEA has, for many years and particularly since President Obama came to office, pushed hard for such a long-term policy signal in the form of a national Renewable Electricity Standard (RES) that would require regulated U.S. utilities to obtain a significant portion of their power from renewable sources by 2020 or 2025.

The $2.3 billion in Advanced Energy Manufacturing Tax Credits (48C credits) in the 2009 Recovery Act benefited 183 projects and leveraged $5.4 billion in private investment but was expended. The Obama administration requested that Congress budget $5 billion to extend the program but there has been no action on the measure.

"It's a strong incentive," an AWEA spokesperson pointed out, but "to be effective manufacturing incentives need to be coupled with a stable, long-term market and even strong programs like 48C can't revitalize the sector if we don't create a market. That is where the RES comes in, as it drives the market and creates certainty."

San Francisco -- Pacific Gas & Electric CEO Peter Darbee spoke today at a public forum held at the California Public Utility Commission; naturally, the opponents of the smart grid and smart meters were there.

The PGE-vs.-(Some of )-The-People debate is the energy world's equivalent of Wrestlemania XVI -- you know the outcome and opinions, to some degree, in advance. And in true Wrestlemania spirit, some in the crowd hissed when the words "smart meter" were first uttered. When Darbee asked if the utility should be punished for innovating, someone murmured "Yes, yes!"

Still, it's good to keep track of the issue. Some of the highlights:

--More of the audience seemed far more worried about the alleged effects of electromagnetic radiation than about any supposed overcharging. Darbee, who came to PG&E from the telco industry, noted that the FCC, IEEE, EPA, FDA, OSHA and other organizations had studied the potential health effects with regard to cell phones and found no correlation. Cell phones, he added, expose consumers to greater amounts of radio waves. You hold cell phones to your ears and talk for minutes.

A smart meter is 20 or more feet away, transmits data for only around 45 seconds a day, and two or three walls usually sit between the consumer and the meter.

Nonetheless, PG&E performed some conservative calculations on exposure. The utility assumed consumers would sit ten feet from their meter and no intervening walls existed. It found that cell phones expose consumers to 13,000 times as much EMF.

--One of the principle causes of the Bakersfield problem, where consumers found that their power bills jumped and blamed it on smart meters, turns out to be how PG&E has to charge for power. Californians pay for power according to five rate tiers. Power bought under Tier 1 and 2 costs around 10 cents a kilowatt hour. When you exhaust your Tiers 1 and 2 kilowatt hours, you start to pay under the rates set forth in Tiers 3, 4, and 5.

In 2001, the state froze Tier 1 and 2 pricing. All rate increases since then have been imposed on Tiers 3, 4 and 5. (Last fall, California ruled that Tier 1 and 2 rates can now float upward.)

As a result, Tiers 3 through 5 have risen to 30, 40 and 50 cents a kilowatt hour, respectively. Last year, summer was extraordinarily brutal in Bakersfield. In July, the city experienced 17 days with recorded temperatures in excess of 100 degrees. Only six occurred the year before. Under its own modeling, the air conditioning load to accommodate the extra cooling needed could raise a person's utility bill from $200 to $800.

"I don't think people understood the tiered system," he said. "I think the rate structure was the primary driver."

PG&E also did a terrible job in communicating the benefit of the meters. It also should have left control analog meters in place -- i.e., have two meters at one house -- to show that they work the same way and are equally accurate. Ninety-nine-percent-plus of the meters are accurate, he said. One more note: many of the meters were in place a year before the complaints started.

--Nuclear? PG&E remains neutral on the issue. The state and the people want to concentrate on efficiency and renewables first, so that is what the company will do. Speaking of efficiency, the utility and the state have to figure out ways to value these programs better so Wall Street will follow suit. Utilities are not rewarded for efficiency programs, even in de-coupled states like California.

--Obama made a crucial mistake when he put immigration ahead of energy on his legislative agenda, Darbee said. Republican senator Lindsay Graham had agreed to join the fight for an energy bill. Fellow Republicans attacked Graham. But when Obama shifted gears, Graham interpreted that as a broken promise and balked.

--Bureaucracy in California remains stressful and onerous. It takes about seven years to nine years to get a large-scale renewable project off the ground, he said.

"The greatest obstacles we face in bringing more renewables to market are the difficulties in permitting and agency approvals at the local, state and federal levels," he said. (See Brett Prior's article today about the colonoscopy that solar thermal companies have to endure for permitting and some of the proposed solutions.)

--Why did PG&E fund Proposition 16, which would have made it tough for cities to set up utilities? PG&E had already spent $24 million to $30 million fighting eminent domain actions in Sacramento and San Francisco that, if successful, would have meant giving utility assets to those counties.

"$45 million (for Prop 16) versus $15 million a year. Financially, it made sense," he said.

--Years ago, Darbee established a household efficiency program that worked. He charged his kid 25 cents per energy-wasting incident, e.g., leaving the lights on. It worked.

In the U.S., over 30 concentrating solar power (CSP) projects with a combined capacity of 8.8 GW are on the drawing board and each has signed a power purchase agreement. But only one of them -- the Martin Next Generation project developed by NextEra in Florida -- is actually under construction.  (Note that these numbers are just for solar thermal power plants. They exclude the handful of CPV projects discussed in a recent post.)

So, what's the hold-up?

There are several possible obstacles. As we discussed in an earlier post, the first and most obvious is financing. Raising billions of dollars in project debt and tax equity is no small feat -- especially if the returns offered to the equity investors aren't that great.

An equally significant obstacle is the maze of permitting and regulatory hoops that need to be jumped through before construction can begin. Both Tessera Solar and Mojave North America are planning CSP plants in Arizona to provide power that will go to California to escape the jurisdiction of agencies like California Fish and Game. Some developers have also shifted to concentrate on finding private land to build their power plants rather than BLM land because of some of the red tape involved.

Still, in the West, the BLM controls wide swaths of land that remain attractive to developers. To help alleviate this problem, the Bureau of Land Management has created a "fast-track" program to help speed things up.

There are 10 large CSP projects in the Southwestern U.S. that have been "fast-tracked" by the BLM.  According to the BLM's website, 'fast-tracked' means that "these projects are advanced enough in the permitting process that they could potentially be cleared for approval by December 2010, thus making them eligible for economic stimulus funding under the American Recovery and Reinvestment Act of 2009."  In layman's terms: we'll get right on these, so they can start construction in 2010 and receive the 30% Treasury Grant.  If the BLM permits aren't ready by the end of 2010, and the Treasury Grant program isn't extended, then these projects will need to go with the 30% ITC tax credit -- and will need to find investors who need massive tax credits.

Three CSP projects have recently passed several of the permitting milestones.  Looks like regulatory bodies are capable of making decisions, after all.  Here are some of the details.

Brightsource's Ivanpah Project, 392 MW

8/4: California Energy Commission (CEC) siting committee issued a proposed decision recommending approval

8/6: Bureau of Land Management issues Final Environmental Impact Statement (FEIS)

Still outstanding: Final Record of Decision from the BLM

BrightSource expects to have all of the final permits necessary to commence construction in fall 2010.

 

Abengoa Mojave Solar (AMS) Project, 250 MW

8/6: CEC siting committee proposed decision recommending approval. The proposed decision is open for public comment for 30 days. The full commission is scheduled to make a final decision on September 8th.

If approved, Abengoa could start construction in 4Q 2010, with commercial service starting 1Q 2013

 

Solar Trust of America (STA) CA Solar 10 project in Blythe, 968 MW

8/11: CEC siting committee proposed decision recommending approval

If all three of these projects move forward, that would represent over 1.6 GW of new solar power plants in the U.S., effectively tripling the total CSP capacity. 

Fingers crossed.

Below is a table summarizing the permitting status for the 10 "fast-tracked" CSP projects, and 2 advanced projects being developed on private land (Abengoa's Solana & Mojave Solar).

 

(Click on chart to enlarge)

GreenVolts, a concentrating photovoltaics (CPV) startup, raised $7.5 million of an anticipated $11.3 million in funding, according to an SEC filing.  The firm has raised more than $50 million in venture capital and debt to date from Oak Investment Partners, Greenlight Energy Resources, et al.  Here's a link to the Form D filing with the SEC.

The Fremont, California-based company uses low-profile ground-mount equipment to focus sunlight on high-efficiency triple-junction solar cells and at one point was building a 2-megawatt power plant for Pacific Gas & Electric (PG&E) in Tracy, Calif.  That project is apparently still active -- despite this photo of the site taken earlier this year by Ed Gunther of the Gunther Portfolio.

Greenvolts recently went through a management shake-up -- the founding CEO, Bob Cart, was replaced by David Gudmundson, formerly of JDSU.  Gudmundson has recruited a number of new senior managers into the firm. 

Many concentrator companies like Greenvolts were formed in the early part of the decade in the midst of a silicon shortage. The shortage ended, Chinese module makers came on the scene to drastically cut the cost of solar, and CPV deals dried up.

But things seem to be picking up.  There has been a small surge in CPV news of late:

In the largest CPV deployment to date, Cogentrix Energy announced that it would build a 30-megawatt solar park for a division of Xcel Energy in Colorado. While solar power plants of this scale are common for crystalline silicon or cadmium telluride panels, this is the first CPV deal of its size. The planned facility will use concentrators and trackers from Amonix, which raised $130 million in April from Kleiner Perkins, et al.

Amonix claims its panels are 32 percent efficient and contain cells that are 39 percent efficient.  Conventional crystalline silicon cells can convert up to 23 percent of the light that strikes them into power and top out at about 25 percent.

A reliable consultant told us recently that "Amonix is the only company that has more than a few years of on-the-ground performance data. Their product reflects the learned reality that CPV as a utility-scale product shouldn’t try to look, smell or feel like PV (SolFocus) or attempt to minimize installation resources or cost (GreenVolts). They don’t try to hide the cranes and large equipment needed to construct their systems. They also spin/track ten times the kilowatts per unit compared to any of the other CPV competitors."

SolFocus said recently that it would have 10 megawatts in the ground by the end of the year.

Concentrix Solar, German-based CPV vendor, funded by Good Energies and recently purchased by Soitec, just announced the opening of a U.S. office, added more people, and celebrated a CEC listing.  More significantly, the firm just announced a 60-kilowatt project in South Africa.

And Solaria -- which specializes in low concentrating technologies -- raised $45 million and hired Dan Shugar as CEO.

Even crystalline silicon champion SunPower is looking at concentrators.  CEO Tom Werner told us that the company is looking at concentrators as a way to get around the looming 25 percent wall in crystalline efficiency.   Skyline Solar has also made some headway with a concentrator made from comparatively inexpensive sheet metal stamped at a Mexican auto plant.

Cost remains the ruling fact of life in solar, and concentrators do add cost. The technology also only makes sense in particular geographies and circumstances. What's more, banks remain reluctant to fork over cash for projects that rely on untested technologies, with "untested" meaning anything that hasn't been field-tested for a period of 10 to 15 years.

Still, compared to the situation just one year ago, the current moment looks like a world of opportunity for CPV.

New GreenVolts Design:

Read the full press release here.

The Solar Energy Industries Association (SEIA) and Greentech Media (GTM) Research today announced a partnership to collect and publish data and analysis on solar photovoltaics (PV), concentrating solar power (CSP), and solar heating and cooling (SHC) markets in the United States.

SEIA and GTM Research will release quarterly and year-end reports covering upstream and downstream solar markets with an emphasis on installations, component costs and domestic manufacturing for each solar technology.

"As a rapidly growing industry, it is vital for solar companies to have high quality, reliable data that highlights market trends and emerging sectors," said Rhone Resch, president and CEO of SEIA. "Our collaboration with GTM Research will greatly help SEIA in our effort to expand the U.S. solar market in the coming years and to meet our goal of installing more than 10 gigawatts of solar annually by 2015. That's enough to power 2 million new households each year."

The partnership's first report will be published in October 2010.  GTM Research will collect primary installation, capacity, cost and manufacturing data directly from solar energy companies via sector-specific surveys to provide an accurate historical and forecasted outlook on the industry.

"We are excited to partner with SEIA to track the U.S. solar market on a state-by-state basis and offer members of the industry an unprecedented level of detail on the market's status, opportunities, and outlook," said Shayle Kann, Managing Director of Solar Research at GTM Research.

For more information on the research partnership, content or availability of the reports, please contact:

MJ Shiao (GTM Research): 617.500.4956, Shiao@gtmresearch.com

Jared Blanton (SEIA): 202.556.2886, jblanton@seia.org

Stereos and TVs have shifted from vacuum tubes to chips. Computers are graduating from hard drives to flash memory. Light bulbs are swapping filaments for LEDs.

A group of startups say batteries could soon make the leap to solid state devices.

Orlando, Florida-based Planar Energy claims it has come up with a formula for a crystalline battery that can boost performance, cut costs, make it easier to erect factories and ultimately pave the way for things like inexpensive, mass-manufactured electric cars that can run on the same battery pack for years.

Prieto Battery, a startup out of Colorado State and named after Professor Amy Prieto, is working on lithium ion batteries made with silicon nanowires. (The picture shows Prieto's battery architecture.) Meanwhile, the Khosla Ventures-backed Sakti3 is developing a safe, dense solid-state lithium-ion battery

The secret sauce is in the ingredients. Conventional batteries are like a chemical aquarium constructed of disparate parts: electrons get transferred between an anode and a cathode via a liquid electrolyte. A porous component called a separator prevents short circuits.  

In Planar's batteries, the anode, cathode and separator/electrolyte are crystalline, inorganic solids that get sprayed onto a substrate, according to CEO Scott Faris.

"We are essentially printing batteries," he said. "Everything is crystalline -- the anode, cathode separator and electrolyte are crystalline."

Rather than travel via a liquid, the charges migrate through the solids, much in the same way that electrical charges move through flash memory. In fact, a key ingredient for controlling the movement of electrons in flash -- silicon dioxide or ordinary glass -- is found in Planar's separator/electrolyte.

"Flash memory is a really bad battery," he added.

By contrast, Prieto wraps silicon nanowires generated via electrodeposition in an organic polymer that then gets surrounded by a cathode matrix. Nanowires increase the active surface area for transferring electrons between the anode and cathode for rapid power delivery. Satki3 is deliberately cultivating an air of mystery, but check out the video anyway.

Researchers have tried to take solid-state batteries mainstream before, so skepticism exists. Planar received a $4 million DOE grant in April to prove its concept and hopes to have a prototype plant up and running within the next 18 months. The first batteries will sport a lithium manganese chemistry. (For other battery concepts, check out Contour's fluorine batteries, zinc batteries from ReVolt and PowerGenix, and the spray-on porous electrode from Porous Power.)

The shift from liquids and disparate parts to solids creates a number of advantages, according to Faris. First, switching to solids allows Planar to shrink the size of a battery or make a battery of the same size that can hold far more electrons. Approximately 95 percent to 97 percent of the volume of Planar's batteries constitutes active materials (in conventional batteries, only about 40 percent to 60 percent of a conventional battery's volume constitutes active materials). Removing the filler from batteries would directly translate to cars with a longer range or lighter smart phones that can play several movies before needing a recharge.

Second, the crystalline structure opens the door to really large-scale batteries, Faris argues. Most lithium-ion batteries are 2 amp hour to 3 amp hour cells. Planar claims it can do 20 amp hour batteries.

"Traditional battery chemistries were not made to scale to this size," he says. The best analogy here is televisions. TV makers managed to produce tube TVs in the 36-inch range, but after that, the size of the tubes and costs involved made increasing the size impractical. Plasma and LCD were required to get to 42-inch and larger TVs.

Third, it's cheap. The materials get sprayed onto substrates in factories under normal temperatures and pressures. The processes are similar to those applied in the thin film solar industry. Another plus: solid batteries won't experience "runaway thermal reactions" or explosions.

"We can coat an active area for pennies per square meter and reduce the cost of the cell by 70 percent, reduce the capital cost by 60 percent to 70 percent, and increase the energy density by 200 percent to 300 percent."

The disadvantages? It's unproven at the moment. Planar has made prototypes, but has not yet moved toward pilot production. Prieto is developing prototypes.

Planar's crystalline nanomaterials also get arranged through self-assembly, i.e., the inherent chemical and physical forces of the materials that make up the components effectively order themselves in much the same way water molecules form snowflakes.

Chip makers have touted self-assembly for years, but most still rely on vacuum chambers, etching and more brute-force techniques for making microscopic lines and circuits. Self-assembly isn't impossible -- it's just very difficult.

Third, Samsung, Toshiba and others have extensive experience in flash memory and batteries. There's a good chance that all of the Asian manufacturers have solid-state battery projects underway. Battery startups like A123 Systems and Boston-Power have already experienced the challenge of competing against conglomerates.

Faris argues that Planar has a lead in the field and the surrounding intellectual property. And to move into mass production, it will invariably link up with conglomerates. Samsung recently signed an alliance with Nanosys on LED and solar technology: May-September marriages are going to be quite common in green.  

 

A pilot is one thing, but MLGW isn’t sold on cellular for full deployment.

AQT is on the cusp of commercial-scale solar production at a fraction of the cost and time of its CIGS competitors. 

Biofuel makers worry that the company could give algae a black eye.

eMeter hopes to prove itself in Taiwan, in order to gain a toehold in the Asian smart grid market.

An industry observer contends that the recent decision leaves many options open.

The lithium-ion battery maker says flow battery and grid storage is where the action is.

If all of these applications for energy efficiency do the same thing, how can you tell them apart?

Strong second quarter results and a 2010 revenue guidance of greater than $2 billion

Yes, says Vinod Khosla. China isn’t winning the greentech race either, he adds.

Amount is down payment on an expected $20 billion to aid Gulf residents affected by the Deepwater Horizon disaster