Venture Capital AWOL on Energy

If you want to see the effect the economic downturn/recession/depression is having on the alternative energy sector, look no further than venture capital investment in Cleantech.

For the year, a healthy $4.7 billion flowed into Cleantech coffers in 2008-- not too shabby. However, the AP reports that the dropoff between the third and fourth quarter was downright frightening:

"Fourth-quarter venture capital investment totaled $954 million, down 44 percent from $1.7 billion invested in the third quarter of 2008, according to an analysis released Tuesday by Ernst & Young LLP. "

44%.

If we are going to come anywhere close to creating the 3 million (or whatever the number is this week) jobs the President promises form alternative energy development, the private sector is going to have to play a role. However, it certainly looks like frozen credit markets are sending a stark signal that makes the viability of the President's agenda even more doubtful.

Alternative energy's banner year ends with a clang [Associated Press]