Monday, June 29, 2009

Turning Algae Into Ethanol Fuel

The New York Times reports today on an emerging, yet relatively unknown, energy source – algae farms. Dow Chemical and Algenol Biofuels are working together on an algae farm that uses algae to turn carbon dioxide into ethanol as a fuel source or a component in plastics. The biggest challenge has been harvesting the hydrocarbons in commercially viable volumes.

Instead of producing ethanol, it looks like Dow plans to use the primarily to replace natural gas as an ingredient in plastic. For its part, Algenol looks more interested in producing ethanol. Algenol is working with Dow, the Georgia Institute of Technology, Membrane Technology and Research, and the Department of Energy to improve how oxygen and water are separated from the ethanol.

Not just any company can pursue algae as an energy source. Significant resources are needed. The Dow/Algenol project will cost about $50 million. Technological barriers must still be overcome, and that requires scientific expertise.

Friday, June 26, 2009

Pew Center Study On Solar And Wind

A new Pew Center study argues that Federal government policies are critical to the success of solar and wind power. The study states that without significant action from the government, renewable energy will account for about 14% of all US electricity in 2030. The keys to increasing the level of renewable energy to 30% by 2030 are:

1. Putting a price on carbon (e.g., cap and trade system).
2. Investing billions per year in transmission systems.
3. Moving towards distributed or building based energy systems rather than purely utility based distribution. This applies to solar, not to wind.
4. Developing electricity storage systems.
5. Making wind and solar cost competitive.

The question is why the Pew Study pegs 30% renewables by 2030 as the "high" renewable scenario. If we can move down the cost curve, develop storage and battery technologies, and encourage private-public cooperation, can't we do better than that? If we don't, what are the consequences?

Wednesday, June 24, 2009

Nissan To Build Electric Cars In The US

Although details are sketchy, Nissan CEO Carlos Ghosn just announced that the company will build electric cars (not hybrids) in the United States. The company will release further details after it hears from the Department of Energy about its application for loans to build more fuel efficient vehicles.

At the same time, Ghosn took a swipe at the gas-electric hybrid Toyota Prius and Honda Insight, pointing out that hybrids have captured less than 7% market share.

Nissan's plan to build battery only electric vehicles (BEV), and not plug-in hybrid vehicles (PHEV) is interesting. As noted at the recent United States China Green Energy Council seminar on Electric Vehicles, the number of companies planning to build BEVs is two times the number planning to build PHEVs. BEVs tend to be more expensive than PHEVs because of their reliance on batteries. Further, BEVs will put more pressure on worldwide battery production. These are just some of the tradeoffs between BEVs and PHEVs that should be examined more closely.

The question going forward is whether BEVs and PHEVs will be mutually exclusive, or whether they can co-exist.

Monday, June 15, 2009

German American Solar Day At PG&E - June 16, 2009

The German American Chambers of Commerce will be holding its 5th annual German American Solar Day on June 16, 2009 at PG&E in San Francisco. This should be a great event for everyone interested in solar opportunities in Germany and in the United States. For those who attend, I'd love to hear what you think of the event.

Thursday, June 11, 2009


Interested in finding out if anyone here has had any experience with Angelsoft? Would love to hear your thoughts on it. Has anyone used Open Deal?

Angels Survey Out

Today's NYTimes featured a great story on the latest angel investor survey.

In 2008 "...angels spent $19.2 billion on more than 55,000 ventures... down from $26 billion in 2007. The average investment for each deal last year was $346,500.

By contrast, venture capitalists made only 440 investments in start-ups last year, putting the bulk of their money in later stages of a company’s growth in deals that averaged $7.5 million, Mr. Sohl said. “Angels provide the seed and start-up funding that turns acorns into trees like Starbucks, FedEx, Amazon and Google,” Mr. Sohl said.

The estimated 260,500 active angels in the United States are the largest source of seed and start-up capital for entrepreneurs (not counting their own savings or money from family and friends), according to Jeffrey Sohl, the director of the Center for Venture Research at the University of New Hampshire.

Read story.

VC Getting More Global

From the SF Chronicle:

"Only 17 percent of venture capitalists expect to increase their investments in the United States over the next three years, while more than half are investing in companies outside the country, according to a new survey.

Read the story

Wednesday, June 10, 2009

Will More Solar Energy Will Destabilize The Grid?

An article in yesterday’s New York Times discusses an oft-ignored consequence of increasing solar power. In California, net metering gives small scale solar and wind users to receive credit for their use. The problem is that utilities may currently accept a maximum of 2.5% of their energy from net metering customers. Unless this cap is raised, solar will face a ceiling. But more solar power may destabilize the electrical grid and increase costs to other customers.

What does this mean? The existing grid is incapable of accepting more energy from renewable sources. This dilemma has implications for upgrading the grid, as well efforts to implement dynamic pricing for electricity. We will be paying attention to these issues going forward.

Monday, June 1, 2009

The Expansion of Solar Energy in China

Last week, I had the pleasure of meeting a consultant who is familiar with the Chinese solar market. He works with Chinese solar companies on engineering and manufacturing issues. While China produces about 1/3 of the world’s solar panels, solar has a small presence in China. Further, he believes that solar’s penetration in China will be slow.

Earlier this year, the Chinese Academy of Sciences stated that it wanted solar to become a major energy source for China by 2050. The CAS is pushing for substantial R&D investments in solar, with the objective of improving the effectiveness of solar technology and lowering its cost. The National Development and Reform Commission recently noted that high costs, the lack of government subsidies, and limited market access pose obstacles to solar’s expansion in China.

While China installed 20 MW of solar power in 2007, the country installed more than 50 MW in 2008. The installed MW of solar power is expected to increase 20% each year until 2012. The National People’s Congress has set a goal of having 10% of China’s energy needs come from renewable energy sources by 2020.

Is this goal ambitious enough? Can the goal be achieved without significant participation by foreign companies? Will foreign companies have the opportunity to compete in China’s domestic market? Will the government permit foreign direct investment in Chinese solar companies?

These questions are related. If the government pushes up the timetable for meeting the 10% goal, then foreign solar companies may be needed to supplement the domestic companies. Investors who are bullish on the Chinese solar market can park their money in LDK Solar Co. Ltd. (NYSE ADR: LDK), Yingli Green Energy Holding Co. Ltd. (NYSE ADR:YGE), and JA Solar Holdings Co. Ltd. (NYSE ADR: JASO). The Chinese government recently announced that it is looking to open up the energy industry to foreign direct investment. At this time, it is unclear whether the solar market will be opened to foreign investors. Given the government’s increasing recognition that solar is a promising area, investors should keep an eye on this market space.