Why Venture Capitalists Abandoned Clean Energy…
A decade ago, clean-energy companies were the hot trend that venture capitalists were chasing. Oil and natural-gas prices were on the rise and Al Gore’s “An Inconvenient Truth” had just made its premiere.
But high hopes that the clean-energy sector would replicate the big returns of biomedical and software startups quickly faded. Instead, monumental losses piled up: Venture-capital investors lost more than half of the $25 billion they pumped into clean-energy technology startups from 2006 to 2011.
A study of why venture capital and clean energy haven’t been a good match was launched by Benjamin Gaddy, director of technology development at Clean Energy Trust, a startup accelerator in Chicago, and Varun Sivaram, the Douglas Dillon fellow at the Council on Foreign Relations. In a paper recently published through the MIT Energy Initiative and written with Francis O’Sullivan, the Energy Initiative’s director of research, they predict future funding for energy startups increasingly will come from more-patient providers than venture capitalists–including groups like the Breakthrough Energy Coalition, formed by Bill Gates and more than two dozen wealthy investors last year. And they argue that established energy companies and governments need to play a bigger role in nurturing clean-energy startups.
A bigger role? They’re already shoveling money at them as fast as they can!
I’m not surprised.
Without subsidies or low component prices, a stand-alone renewable energy system can be quite expensive and could never compete against an existing power grid. It would be cheaper to run a brand new line than it would be to invest up front the entire amount for a renewable energy system over its entire lifetime.
Just call Wynnie the pooh, or Red Rachel , they will open the vault for you.
Heh
“And they argue that established energy companies and governments need to play a bigger role in nurturing clean-energy startups.”
A double speak for wanting somebody’s else’s money – fascism.
“Of course, the renewable VCs could still get lucky – even worthless assets can generate a return, if you can find a financially illiterate politician who is stupid enough to pour taxpayer’s money into schemes which have already failed.”
Welcome to Canada!! We have LOTS of politicians who meet that description, including our Prime Minister and the Premiers of Ontario,B.C.,and Alberta.
C’mon up!
Two further key points to note. The study quoted in the WSJ used numbers 2006-11, BEFORE the great crash in oil and gas prices.
Second, biomed and software startups produced huge returns for trivial physical inputs: steel, concrete, etc. The renewables simply cannot do that under any circumstances. The physics of basic EREOI prohibit it.
Al Gore. Where is he now? He’s not our answering questions, not is thing. He is above questioning. He is all knowing, not sure even God could question him and get an answer. Gore churns the stomach and stimulates the bowels of people who have the capacity for reasoned thought.
Al is keeping out of the limelight because there is no need for him to keep his ugly mug out there.
Al still owns about 20% of the European Carbon Exchange,which makes about a billion dollars a year,so don’t worry too much about Al, he’s doing okay.
The battle has been won, every politician in power in the so-called “civilized” world is onside with Climate Change,as is the entire MSM,no sense for Al to rub salt in the wounds of heretics like us.
Here’s an old article from Infowars, doesn’t mention the total, but you’ll get the idea, it’s BIG money at stake.
http://planet.infowars.com/politics/2432
“… clean-tech companies were going into markets that are legacy industries, for which a product already exists that does a pretty good job.”
Reinventing the ENERGY wheel through solar and wind was a FAILure in the 1970’s … and is a FAILure in the “new millennium”. I feel sorry for the kids today (under the age of 40) who did not witness the futility of Solar and Wind in the 1970’s and early 80’s. It simply could not compete with CHEAP, PLENTIFUL (so long as some Muslim Sheik wasn’t sticking it to the infidels) ENERGY. The “technology” hasn’t changed in any significant way … unless you count CHEAP Chinese Solar Panels as “new technology”. The “GREEN” movement is as shallow as your girlfriends “happiness” … it is unsustainable.
They want a bailout like their crony peers in the financial sector.
Don: You read my mind the PM and some Premiers will buy into anything…..they are so stupid!!
Coming soon, the made in Canada Electric Car.
You know the Liberals cannot resist this one, it is way too easy a way to funnel taxpayer money to their buddies, for decades.
An electric Bricklin, just what Canada needs.
Unreliables have always been a joke when you think about putting them on the grid. The only thing that has changed over the last forty-five years is that three waves of pseudo-environmental mass hysteria has succeeded, in the absence of critical thinking and numeracy, in achieving religious-like status within the dominant progressive culture. That culture, being statist, means a green theocracy.
Politicians (Artsys or Lawyers) holding power who can barely figure out how to plug in a light bulb, reliant on faith-based narratives think that they are qualified to rule over the complexities of power grids. Rent seeking whores of the “green energy business” out-maneuver them as the representatives of the ovine citizenry are technically and numerically handicapped while being politically or theologically locked into a guaranteed poor outcome.
solar panels and windmills will never be adequate to power Canada. never, and the use of them is harming those who have less money and are trying to live their lives without government in their pockets everyday. we need to fire everyone who is in favour of solar panels and windmills.
We’ll be sending you a ton of ‘celebrities’ in about 6 weeks…
I had the same reaction as Pete. If high-powered, well-connected foundation researchers and MIT scholars hyping so-called “clean energy” can’t get that basic fact correct then there’s little else they can be trusted to report accurately.
“An electric Bricklin, just what Canada needs.”
Massive subsidies, a massively subsidized electric power train, and a new model name will fix the Bricklin’s problems – how about “the Newfie”?
Look no further than the 2nd law of thermodynamics. There I just saved everyone a ton of time and money.
Venture-capital investors lost more than half of the $25 billion they pumped into clean-energy technology startups from 2006 to 2011
VC’s lose a lot of money anyway. Funding ventures that don’t work out is part of the game and it is planned for. They expect a small percentage of their ventures to succeed and recoup the overall investments they make.
The quote above is a little ambiguous. The real question is if they made enough profits or revenue off of $12.5 billion to make up for the losses and/or turn a profit. If it is a net loss, it doesn’t look good but I would then want to know which ventures went under. Were they ones run by political cronies? Sometimes those ones are planned to fail while donors reap big paychecks and golden parachutes.