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Despite slashing their funding in half for the sector in 2009, venture capitalists project a 63 percent increase — larger than any other sector — in their investment in clean technologies over the next three years, said Sandra Itkoff, ’89, senior vice president for the Angeleno Group.
“There are a number of market drivers that will help the U.S.,” said Itkoff, who moderated a Chicago Conversations panel at the Grand Hyatt in San Francisco on March 3. Among drivers are the fact that only one U.S. company ranks among the top 10 solar module manufacturers or among the top 10 wind turbine manufacturers, and none rank among the top 10 advanced battery manufacturers, she said.
Additional market drivers in the United States, Itkoff said, include:
President Obama’s vision for an “energy economy” with $600 billion in investment hinged on the capping and trading of carbon use, said Rand Rosenberg, ’77, senior vice president for corporate strategy and development at Pacific Gas & Electric (PG&E). “We supported that idea and it’s not completely gone yet, but it’s definitely on life support,” Rosenberg said. “The challenges are tremendous, but the problem is that we can’t afford to not figure out a way to pay for this.”
After hearing for two days from a team of scientists both supporting and opposing claims of impending climate change, PG&E officials are convinced the problem is real, caused by man, and must be addressed, he said. The reality of that response requires tradeoffs, such as California’s mandate that investor-owned utilities generate 20 percent and eventually 33 percent of their energy from renewables, Rosenberg said. “The problem is that our rates are high enough already,” he said. “We are on a collision course for how we are going to do this economically.”
The United States has not achieved as much progress increasing renewables as other countries, said Kristina Peterson, ’90, vice president for project finance and business development, and president of Gemini Solar Development Company for Suntech Power. For example, Germany increased renewables from 6 percent to 16 percent of its energy in a few years by introducing a “feed-in tariff” program in which utilities pay others to generate renewable power, Peterson said.
“It’s a very expensive way to do it, but it is simpler than the various financing structures utilizing investment tax credits that are available now in the U.S.,” she said. “It can be done, and it can be done in countries with large populations. I don’t know what the right solution is, but we’re coming from such a low base that we need to do more. The key issue is the cost. If you can figure out how to drive costs down further and develop better energy storage, that will help utilities to reduce their total costs.”
Overall, recognition of the climate problem and efforts to address renewables have improved dramatically in the U.S., said Josh Lutton, ’01, managing partner at Woodlawn Associates. “When I graduated from Booth, my classmates thought I was nuts for going into green energy,” Lutton said. “Over the course of the last nine years, I’ve really noticed a sea change in how the general population views clean tech and green business. It’s gone from being a very fringe thing to something that many average people do care about.”
Phil Rockrohr