Clean Energy: All Dressed Up and Nowhere to Go

Clean energy, fueled by Obama-inspired media hype, continues to be regarded the next (current?) "big thing," but a snapshot of the industry today tells a different sotry: renewables are the stuff of which bridge loans were made. Russell Gold reports in the Wall Street Journal that renewable energy has fallen into something of a hole-- a funding hole.

Private investment, curbed by the ongoing economic downturn, has all but dried up and the much-anticipated, passionately longed for and promised stimulus cash has yet to arrive. Gold notes:

"Investments by venture capitalists in early-stage companies also plunged 48% to $1 billion in the first quarter, according to Cleantech Group LLC. "There may be some good companies that might not get funded, but that doesn't mean they won't get funded six months from now or 12 months from now," says Cleantech research director Brian Fan. "For the industry as a whole, this is a pause."

Companies that were able to secure financing before last summer are in the best position to survive until government stimulus money becomes available, say industry executives."

What makes this situation more than simply a waiting game and actually somwhat problematic is that much of the federal stimulus cash is contingent on private co-financing and Gold paints a bleak picture of the capital markets' current ability to fund-- and dispositon toward-- clean energy ventures.

The Journal write-up points to the recent Solyndra deal (see earlier post) as an example of this catch-22. That DOE loan is contingent on $100 million in privae financing. Who knows when, whence, or if that cash is coming?

Clean-Energy Industry in the Doldrums [Wall Street Journal]