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Green Energy Sector Weekly Update – Chinas Growing Green Clout

Posted on Tue, 28 September 2010 13:30 | 0

After nearly two years at the Department of Energy, Matt Rogers, the agency’s most influential bureaucrat, is leaving, having overseen one of the DOE’s most ambitious undertakings: the disbursement of billions of dollars to support the deployment of renewable energy infrastructure across the country.

When Energy Secretary Steven Chu hired Rogers 19 months ago, he tasked the McKinsey & Co., consultant with creating the processes that will ensure the DOE spends its billions in stimulus funds smartly. Like any good, benchmark-driven consultant, Rogers executed.

Rogers and his team handed out  about $800 million a month to support wind, solar and other cutting- edge renewable energy projects. By July of this year, when G.E.R. first reported Rogers’ expected departure, the DOE had spent about $29 billion in stimulus money.

Rogers’ major legacy has been the disbursement of the DOE’s loan guarantee program, actually a program originated under President Bush, but one that only took off under the Obama administration. Today, the DOE loan guarantees are funding staples for renewable energy and cleantech companies. BrightSource Energy scored a $1.37 billion loan guarantee for its Ivanpah project. Solyndra, the Fremont, Calif., maker of cylindrical solar photovoltaic systems, secured $535 million, and thin-film PV module maker Abound Solar, which last July was awarded $400 million.

Rogers is leaving the DOE at a time of great regulatory uncertainty in the U.S. Congress has failed to pass climate change legislation that would have, in a perfect world, provided the long-term financial certainty one-time stimulus programs can’t.

Pressed by the ever-growing shadow of China’s growing green clout, some lawmakers are looking for ways to bring the stability that investors hoped cap-and-trade would have created.  Thus, a little than two months before the November midterms, a group of bipartisan senators introduced Renewable Electric Standard (RES) legislation. Senators  Jeff Bingaman (D-N.M.), a prolific writer of green energy legislation, and Sam Brownback (R-Kan.) are co-sponsoring the bill. Also supporting the RES legislation are Senators Byron Dorgan (D-N.D.), Susan Collins (R-Maine), and Tom Udall (D-N.M.).

The RES is perceived as a sort of friendly cap-and-trade that will at the very least ensure that cash-rich electric utilities continue to invest in solar and wind power projects.  What it won’t do though, (unlike cap-and-trade), is provide a price point for carbon that would finally let green power be competitive with conventional power. RES is only a band-aid solution.

This week we reported on various people moves. The most high profile was the hiring by Canadian solar startup Morgan Solar of Asif Ansari, the founding CEO of Google-backed solar power developer eSolar, as its Chief Executive Officer. That’s a big coup for Morgan Solar, which has developed an effective Concentrating Photovoltaic module (CPV). It is the technology, developer by company founder John Paul Morgan, that actually convinced Ansari to relocate to Toronto from Southern California to take the helm of Morgan Solar. “I had heard about Morgan Solar but had always had my doubts about the CPV economics,” Ansari told  G.E.R. in an exclusive interview. “But I took a look at Morgan’s technology and I instantly understood that they had developed a game changer,” he explains.

Evergreen Solar today announced that CFO and COO  Michael El-Hillow would take over as CEO. He replaces long-time CEO Richard Feldt. Evergreen, a developer of low-cost string ribbon technology, was attractive when a decade ago, when solar costs were high. But declining costs over the past two years have made it difficult for EverGreen to compete. In a bid to boost margins the company has relocated its production to China, but this strategy has yet to bear fruit.

VC and PE Watch

Irish wind developer Gaelectric secured $18 million in debt and equity, which it will use to book 960 megawatts of transmission capacity in Montana.

New York-based private equity firm Warburg Pincus and Tarpon Investimentos, a São Paulo fund, jointly invested BRL$350 million ($205.7 million) in Omega Energia, a Brazilian renewable energy company.

San Francisco-based Nextant, a software developer for the smart grid industry, closed a $43 million financing led by Oak Investment Partners and Intel Capital.

UK-based Eight19 Limited, a  developer of high performance, low cost plastic solar cells, raised £4.5 million ($7.02 million) from the government-backed Carbon Trust and Rhodia, the Paris-based chemicals company.


Back in the Spring of 2009, San Francisco solar developer Recurrent Energy took advantage of the “financial crisis discount” and snatched Chicago-based solar company UPC Solar and its 350 MW project pipeline. But this week, Sharp, Japan’s largest solar panel maker, acquired Recurrent Energy. The move confirmed how difficult it is for small renewable energy developers to remain independent. “Sharp’s reputation and balance sheet will be an essential part of our further growth,” Recurrent CEO Arno Harris told us in an email. In today’s challenging economic times “Recurrent Energy needs the credit of a company like Sharp to work with large utilities and financial institutions,” he adds.

Source: Green Energy Reporter

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