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Summary:

Brightsource Energy could go public as early as Thursday on the Nasdaq, and with that move the solar power plant developer will be making history.

BrightSource_Coalinga

Brightsource Energy could go public as early as Thursday on the Nasdaq, and with that move the solar power plant developer will be making history.

How, you ask? For one thing, the Oakland, Calif., company is managing to accomplish something that few (if any?) solar startups have done: raising massive amounts of money to build a massive solar power plant in California. The two other solar technology developers who also have become major power plant developers are SunPower and First Solar, and both entered and built their first big solar farm after they had built up their core manufacturing business and gone public.

Here are five reasons BrightSource’s IPO is important:

1). A success story for cleantech VCs: The public market debut will deliver BrightSource’s venture capitalists a return on their investment — something few cleantech startups have managed to deliver. The solar sector in general is too young to have many successful IPOs, and the amount and time and money it’s taken for some solar companies to commercialize their technologies already have forced some VCs to reconsider their investment strategies.

2). Technology validation: BrightSource’s ability to go public at the valuation it wants represents a vote of confidence for the company’s next-generation solar power technology. The tech uses flat mirrors to direct sunlight to heat water in a boiler atop of a tower, while older solar thermal technology uses trough-shaped mirrors and no tower. When completed,  the 392 MW Ivanpah will be the largest concentrating solar thermal power plant in the world and it is fully financed to the tune of $2 billion.

3). Loan guarantee success: With BrightSource on its way to compete Ivanpah and now going public, it will serve as a success story for one of its big sponsors: the federal government. To build Ivanpah, BrightSource snagged a $1.6 billion loan guarantee from a U.S. Department of Energy program that has been maligned for funding Solyndra’s factory construction. That loan guarantee makes it possible to borrow money and raise additional money from investors including NRG Energy, and Google.

4). Meeting clean power mandate: Let’s not forget one big reason why so much money has been pumped into solar technology and power plant development. States such as California are requiring their utilities to buy a growing amount of renewable electricity. BrightSource’s success with Ivanpah and other projects will help California meet its aggressive target to get 33 percent of renewable energy by 2020. Ivanpah will ship its power to Pacific Gas & Electric and Southern California Edison.

5). A big boost for a beleaguered industry: The solar industry is going through a dark period. An oversupply of solar panels has caused a collapse in prices and forced many manufacturers to file for bankruptcies. Some developers of concentrating solar thermal power projects have filed for bankruptcies or decided to switch technologies, and that switch requires them to amend or get new permits. BrightSource’s ability to do an IPO is a good piece of news for a business that has endured financial difficulties and political attacks lately.

Photo courtesy of BrightSource Energy

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  1. Top 5 reasons to RUN from this IPO:

    1. VC’s on this one were directly linked with government insider crony capitalism.
    2. Technology: IPO Investors do not validate technology, the energy market will. Without the insider loan guarantee, at a cost of $2B for $392 MW this company/project would not exist at all. Their huge overrun at Chevron Coalinga would have them run off most projects.
    3. Loan guarantee on this one was an inside job with an ex Brightsource Venture Capitalist partner going to work for the Obama administration and helped push the loan thru to Brightsource.
    4. California will go broke meeting their renewable mandate using sources like this that are unproven and 5 times natural gas prices. In business 8 years and they have never produced one watt of electricity. Even cold fusion at MIT has done better than that!
    5. The reason the industry and company is under attack is that the market is speaking and this is a bad deal for everyone except the VCs and officers cashing out your money Friday morning…They are trying to get out while they can before the whole charade goes bust!

  2. This project like all massive solar installations only runs with Fed credits, loans, and subsidies.

    Any basic business that can’t be profitable without Fed $ is not sound and viable

  3. whereishawkins Wednesday, April 11, 2012

    They’re withdrawing their IPO. Imagine that…

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