US cleantech investments move to smart grid and energy storage

A Reuters article on 18 Aug 2009 wrote that the US greentech sector, which suffered a drop in funding early this year, is seeing renewed interest with venture dollars flowing in once again to promising startups and some companies looking to resurrect public offerings that had been set aside.

Investment is seen shifting from capital-intensive energy generating technologies such as solar and wind to those associated with energy storage, transportation and efficiency, particularly lithium-on battery makers and startups in smart grid sector.

Cleantech investments is expected to see a significant pickup as early as this fall, with continued improvement through 2010 but unlikely to reach the $2.6 billion peak seen in the 3rd quarter of 2008. Aggressive stimulus from the US Department of Energy (DOE) is also providing a big boost.

Vollen of Robert W Baird & Co said investors now are more interested in technology that was less capital intensive, such as those associated with the smart grid infrastructure and energy efficiency. “Everybody still recognizes that energy storage is the holy grail of the sector,” he added.

That quest helped lithium-ion battery maker A123 Systems attract $69 million last quarter to expand battery manufacturing, while residential smart grid company Tendril attracted $30 million in June. Energy efficiency company CPower and Grid Net, which builds software for smart meters, also were successful in raising money.

Some companies like A123 Systems and biotech firm Codexis are actively monitoring the markets to launch their initial public offerings.