The news of the new EU industrial strategy came just a couple of days after the Geneva-headquartered, French-Italian manufacturer STMicroelectronics launched its own three-year project, worth €360 million ($463 million), aimed at creating a European microelectronics design ecosystem based around its fully-depleted silicon-on-insulator (FD-SOI) manufacturing process.

Some in the industry, such as chipmaker GlobalFoundries, have previously urged European authorities to back electronics manufacturing on the continent in order to counteract the vast influence of Asia and (to a lesser extent) the U.S. in this field.

Cheaper, faster, smarter

The European Commission’s strategy, announced on Thursday, is intended to make chips cheaper, faster and smarter. It will concentrate on shoring up three existing electronics clusters, namely those in Dresden (Germany), Eindhoven (Netherlands) and Leuven (Belgium), and Grenoble (France). Connections will also be made with other clusters such as that in Cambridge (UK), which is big in the wireless sector.

“I want to double our chip production to around 20 percent of global production,” Digital Agenda Commissioner Neelie Kroes said in a statement. “I want Europe to produce more chips in Europe than the United States produces domestically. It’s a realistic goal if we channel our investments properly.”

As per usual, this isn’t a simple public cash splurge. €5 billion in public funds – 30 percent from the EU with the rest coming from national and regional funds – will go to R&D, in order to help stimulate the sector. Overall, the Commission says, industry has indicated it will stump up €100 billion over the seven years: €15 billion in capital expenditure and €85 billion in operational costs.

The kind of electronics we’re talking about could be used in desktop and handheld computers, but the main thrust is for embedded systems and “internet of things” devices, from sensors and smart grids to new healthcare technologies. As Kroes said in a speech, “this isn’t about computers.”

Targeting these areas plays to Europe’s strengths. According to the Commission, Europe already pumps out half of global automotive electronics, 40 percent of electronics used in energy applications, and 35 percent of those used for industrial automation – this will be a reference to the output of companies such as Bosch, which are hugely active despite often being somewhat under-the-radar. Then we also have smaller manufacturers working in high-growth niches, such as health implants and sensors.

And jobs?

The purpose of all this is to make Europe less reliant on manufacturers outside the continent, but job creation is also a major factor. The Commission reckons the European electronics industry already employs 200,000 people directly and supports a further million jobs indirectly.

That said, the Commission also pointed out in its statement that demand for skilled workers in these fields is higher than supply – if this whole strategy is to work, the implication runs, Europe will need to attract more skilled workers. The statement talks of coordinating public efforts across Europe. Perhaps that will mean tweaking immigration rules: something the U.S. tech sector is also heavily vocal about these days.

Meanwhile, STMicro’s push – called, incredibly, “Pilot Lines for Advanced CMOS Enhanced by SOI in 2x nodes, Built in Europe” (Places2Be) – also takes place in the context of a wider European project, the nanoelectronics-focused ENIAC. In a briefing note accompanying Thursday’s announcement, the Commission insisted that ENIAC and ARTEMIS (another project focusing on embedded computing) had been a success, and that the new drive did not denote failure of those two schemes.

The Commission said the new joint undertaking would build on “lessons learnt” from ENIAC and ARTEMIS while providing a “simplified funding structure”.

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That first RE.WORK summit will take place on 19 September, which is also the second day of GigaOM’s Structure:Europe conference in London. The RE.WORK program will kick off with a focus on the areas of: the internet of things, 3D printing, nanotech, artificial intelligence, robotics, computing systems and sensors.

“We’re trying to showcase emerging technologies and breakthrough ideas,” summit founder Nikita Johnson told me. “It’s all about reworking big challenges that we’re facing in the future. We want to bring the technology and science aspect, but with mission of positive impact.”

While the first of these summits will focus on technology, others will have different themes: one in December will deal with urbanization, RE.WORK Health will take place next year, and still others will handle energy, education and the environment. The first three meetings will take place in London, with others set for Dublin, Berlin and other European cities. Events will also be followed up with smaller meet-ups, Johnson added.

Apart from Solve For X, other initiatives in this space include TED, to a certain extent (RE.WORK looks to be a bit more collaborative and interactive) and the engineering-led Global Grand Challenges Summit.

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Evolution of the home energy market

That Nest and Opower have emerged as the leading companies fighting over this business says something about the small and slow-moving industry. Over the years the market for devices, websites and services that attempt to get consumers to reduce their energy use — a largely unsexy and unappreciated task — has been riddled with struggling startups and failed clunky product launches.

Home energy dashboards never made a dent with consumers. Various startups from Tendril to EnergyHub realized early on that high-end energy dasboards were not the way to go. People don’t care enough about energy and didn’t want to spend money on an energy-specific device.

At the same time, residential-focused energy efficiency services from utilities have taken years to roll out in any meaningful way. Utilities are notoriously slow moving and cautious. Companies that tried to work in these markets got frustrated, too. Google and Microsoft both shut down their energy efficiency web tools after failing to gain much interest or develop any partnerships.

Opower’s entrance

When Opower launched almost six years ago, it found early success with an energy efficiency product that provided immediate value to utilities: mailed energy reports. While Opower has always been an energy software and data company, it were these mailed reports that were initially valuable to utilities that (particularly back then) had unsophisticated digital presences.

Honeywell & Opower’s iPad smart thermostat app

The Opower reports came in envelopes that looked like bills (so were almost always opened) and they used behavioral techniques (smiley faces, peer competition) to gently convince the utility customer to reduce consumption. The mailed reports were also relatively inexpensive compared to home energy devices and dashboards.

But over the years Opower has had to morph into a company that largely sells digital energy data products to utilities. There’s only so much business — and so much effect on consumer behavior — that paper reports can have.

Opower now largely interacts with utility customers through email, text messages, and websites. Its newer digital products include a Facebook app and more recently software for connected thermostats, in partnership with thermostat giant Honeywell.

Opower’s work with Honeywell and its connected thermostat product was one of the first indicators of how competitive Opower and Nest could become. The thermostat has emerged as the great hope for creating a gateway into home energy efficiency following the demise of the energy dashboard. In addition, Honeywell saw Nest as a pretty direct threat, having previously sued Nest over patent infringement around the learning thermostat.

It’s unclear how much success the Honeywell/Opower thermostat is having, given that it’s such a new product. PG&E was the first utility that piloted it and some early results suggested that customers liked using the smart thermostats and particularly liked being able to remotely control the thermostat using their iPhone.

But one of the key differences between Opower and Nest’s business models is clear through that partnership. Opower’s utility products are almost always white-labelled for utilities, so, for example, if it creates a website and system of emails and texts for PG&E customers, then Opower’s alerts are branded with PG&E’s logo. In contrast, Nest has long been focused on selling directly to consumers and building a consumer brand.

Nest emerges

Nest was officially launched toward the end of 2011, though the company had been building its technology for a year and half before that. Its core business philosophy involves the production of a well-designed thermostat that users would covet and that could also collect data about the user and learn their behavior. The thermostat can use that knowledge to shave off between 20 and 30 percent of the user’s monthly heating and cooling, and Nest has mostly focused on selling the thermostat directly to consumers.

But Nest has more recently started to move into offering utilities and energy service providers energy efficiency services. Last month Nest launched a variety of energy services, including demand response, and also this week acquired a startup, MyEnergy, that aggregates and analyzes utility data. It’s clear that one of the most important aspects of the Nest thermostat is the services that can be run based on both the consumer’s individual and the collective Nest users’ data.

Nest appears to want to maintain its brand and its ability to connect directly with customers. When it launched its energy services last month, the company told me that its services sit between the consumer and the utility. It also approves eligible customers and monitors how the services are performing and how the customers are reacting.

This direct-to-consumer approach could also prove useful if (and when) Nest launched any more connected home products in the future.

Power in the data

Essentially, both Nest and Opower are cloud-based data analytics companies that are using various — and increasingly competitive — ways to access home energy data. Nest calls its cloud-based big data algorithms Auto-Tune, and the data that is collected is from its increasingly large amount of thermostats being installed throughout the world.

Opower has built out its big data platform, Opower 4, which collects data from at least 75 utilities, processes data from more than 50 million homes, and has 15 million homes fully connected into the Opower platform. Opower is analyzing 16 percent of all of the smart meters in the U.S.

Each company’s approach has unique benefits and hurdles. Opower has been widely successful with utilities using the approach of starting out with a basic data analytics service, and adding on more complexity and control over time. Utilities are hard customers to win over, so the benefits of winning their business early is invaluable. Nest, with its direct to consumer approach, could be slightly threatening to some of the more conservative utilities.

Nest, on the other hand, has the capacity to build a consumer brand that can make money from direct consumer electronics sales as well as working with energy service providers. Opower has little consumer brand presence and mostly subverts its brand to its utility customers.

Which method will prove more successful over time? It’ll be interesting to see, but in reality there will be room for both. It’s also refreshing to see different types of innovation and execution in the home energy efficiency space — an industry that has been neglected for quite a long time.

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In new data provided by the Edelman Trust Barometer survey of 31,000 global respondents, 68 percent of respondents trust the “renewables” business to do the right thing, as compared with 58 percent for natural gas, 53 percent for utilities and 49 percent for oil (see image below).

That’s a license to lead, folks. Despite significant perceptual headwinds, renewables emerge with a 10 point lead over its nearest energy competitor. As a marketer, I’m reminded of why I originally found this sector so energizing and inspiring during the cleantech boom of 2007-2008.

Note the high trust in places like China and India. Not surprising, considering the clear messages sent by those governments about cleantech deployment, and the ability of those nations to leapfrog traditional energy systems to meet electricity demand for growing middle classes. Both countries boast cleantech leaders like Hanwha Solar, Suzlon and Tata.

Note the low numbers for Japan (66 percent) and Germany (63 percent). These are consistent with both countries’ lower trust in business and energy.

The German numbers shocked me the first time I saw them. But for this country, renewables have graduated to the “big energy” establishment, which I expect engenders less trust than the sheen of new technologies in emerging markets.

For Japan, trust in the entire energy industry is lower than other countries post-Fukushima, but renewables are trusted most within the Japanese energy sector.

Broadening focus to the entire energy industry, this data corroborates another trend: so-called “purpose-driven” energy innovators enjoy a trust premium over other energy professionals. This not just a cleantech thing, it’s an advanced energy thing. This is for two reasons:

When asked to rank attributes that shape trust in a company, respondents ranked “purpose” – protecting the environment, partnering with NGOs – as most important, and being an “innovator of new products” close behind (see image below and note the orange and purple attributes that respondents rank as more important for the energy industry as compared with general business).

Clearly, energy companies can earn more credibility by better communicating real global citizenship and helpful innovation.

On the flipside, communicating about the success of business “operations” (dark blue) was valued only as table stakes for being an energy company, not as a major trust-builder. I would argue this is true if we’re talking about large companies, but I think the opposite is true for advanced energy start-ups where the onus is much higher to prove operational success.

The data also shows how technology is trusted more than energy. In my opinion, the marriage of technology and energy is a net gain for energy company trust building. See the image below, which depicts how much higher technology is trusted than energy (78 percent vs. 67 percent). I interpret this as further proof that innovation gives the energy industry license to lead.

This is reflected in the strong Silver Spring IPO on Wednesday. Silver Spring is an innovative energy IT company, not just an energy company. Energy IT is a highly credible sector populated by other promising companies like OPOWER and FirstFuel, and a primary focus for venture capitalist still focused on cleantech. The public trust data corroborates the investor enthusiasm.

Would you like more data on trust in the energy industry? Don’t hesitate to contact me at joey.marquart@edelman.com.

Joey Marquart is the global cleantech sector lead for Edelman, the PR firm. He is based in Silicon Valley and oversees communications programs for solar, bio, EV, materials and smart grid companies.

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DuPont, which has a market cap of $44 billion, “is not an energy company, it’s a science company,” Kullman reminded the audience. But with its industrial material products, high-yield agriculture strains, and bio-based chemicals, DuPont is a major supplier of materials for solar manufacturers, and is building a ground-breaking cellulosic ethanol plant in Iowa. “No industry needs innovation more than energy,” said Kullman.

Following Kullman’s remarks, we sat down with the 57-year-old, who is DuPont’s first female CEO, to ask her about working with startups, how they’ll overcome the hurdles of biofuels, and just how bullish she is on solar. The following is an edited interview:

How can startups work with DuPont? What are you guys looking for?

It depends on the area. We work with a lot of startups and small companies and we do a lot of collaboration. We’ve long transitioned to a belief that our ideas aren’t the only great ones out there and we are openly looking to collaborate — we call it inclusive innovation. Some of the problem’s we’re facing are so complex that you can get there faster and smarter if you do it with others that have skill sets that align with where we’re going or with what we need.

We’ve been working with Genencor, a Palo Alto startup, since the 90’s and the idea was to use agriculture to create industrial materials and fibers. We had certain parts of it and they had other parts of it.

There can be great synergy, but you have to get really specific. We tried before to paint the world with a large partnership with a university or a company without that definition and it doesn’t really go anywhere. A lot of times we think we know what we want, and when we engage we find out that there’s a whole other side of this that they [the startup] can bring that we hadn’t really comprehended before.

We bought Innovalight, which is helping us from the standpoint of silicon inks for solar photovoltaics. We don’t buy them all, right? The relationship is really dependent on the needs of each company and can span a contract to a JV to a purchase or a minority equity investment. The more inflexible we are the less successful we’re going to be.

Is there a strategy for acquiring startups? The reason I ask is because it seems like a lot of the IT and web ecosystem has been built around companies like Cisco or Google aggressively acquiring startups, but the science sectors don’t seem to have this kind of acquisition ecosystem.

It has to be, to what end. You want to put out real money and the question is how will it create value for our shareholders? So it tends to be very specific to an area. Like the solar area we might be looking broadly at novel materials, or novel processes, that we can bring in that can enhance our position. So it’s not a strategy to acquire, but an open strategy to create the strongest future whether its acquisition or JV or licensing. It’s about creating shareholder value. Areas that we’re very active in is agriculture, nutrition, and industrial biosciences and advanced materials.

A lot of people, including myself, are watching the ground-breaking of the cellulosic ethanol plant in Iowa with great interest. But many companies have tried to do this and have struggled. Why will DuPont succeed in this area when others have not?

We’ve been working at this for awhile — a decade. We had very specific milestones we had to meet from a tech standpoint and a scale up standpoint. We had a 150,000 gallon plant that had to meet certain criteria before we would go to the next step. This was the second major project we did from that standpoint. The first was the Bio-PDO that goes into fibers and carpets. We had an understanding and a lot of experience that told us we could get this done. But we don’t start putting a shovel in the ground until the milestones are met.

We already have the relationships with the farmers in the communities that will provide the raw materials for the plant. And we understand how much it’s going to cost to collect and store, and that’s all part of the economics. I was really impressed with the work that the team did in laying that all out five years ago. I think we have a much better shot at being successful because we have all of these areas moving at the same time. We keep building on our learnings from previous projects and it’s helping us do it faster and understand what we need from others and I think it’s going to create a huge potential for success.

Has the process of moving the cellulosic ethanol plant along taken longer than expected?

It’s never short enough for me. They [her executive team] would probably tell you that it exceeded their expectations. It’s this tug of war.

DuPont is a major supplier for materials and that makes it susceptible to the vulnerabilities of the solar cell and panel market right now. Are you still as bullish on the solar materials sector as the $2 billion DuPont was planning on selling for 2014?

I think we’re bullish on solar PV. We believe that the progress that has been made around efficiency has been tremendous in the last few years. I remember thinking when crystalline silicon got to 12 percent efficiency that it was impressive and now they’re pushing 20 [percent].

I think that materials matter. It’s not only the efficiency of the cell when it starts, it’s the efficiency 25 years later. So weatherization, things like that, become very important and materials matter in that.

I think we’ll get there. I think we’ll get to parity on average in 2015. If you look at what China’s announced for their 5 year plan to install 21 GW is helping right.

But I think it’s going to be bumpy. Any new technology transition is bumpy. And you’ve just got to be able to put it in perspective for those bumps. How much we sell in 2014, or 2015, will depend on how many modules are built, right? But I think the science is there and we just have to continue to make the progress.

What would you want to see from the government in the energy and clean power sectors?

Stable government policy. I think stability around that is very important. Consistent government policy is a really important part of a secure and a more diverse energy future.

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But maybe sports facilities — and really anyone that wants to deliver a service — be it online music or a few hours of entertainment during a national sporting event — should start thinking about their infrastructure and their resiliency. After all, our infrastructure isn’t getting any younger, and consumers certainly aren’t getting any more patient.

That was the point of a blog post Amazon Web Services Distinguished Engineer James Hamilton wrote a day after the game. Hamilton offered up a few smart solutions for power outages. At least one of them — using diesel generators to ensure redundancy — makes great financial sense for something like the Super Bowl.

Two bus-sized 2.5-3 MW generators should be more than enough to back up the power supply from the Superdome’s utility, Entergy, Hamilton wrote. Each generator costs less than $1 million, Hamilton wrote, and can be rented for less. Add in switchgear, uninterruptible power supplies and a one extra generator for good measure, and the cost comes in at less than $10 million. Hamilton continues:

“Looking at statistics from the 2012 event, a 30 second commercial costs just over $4m. For the price of just over 60 seconds of commercials the facility could (be) protected against fault. And, using rental generators, less than 30 seconds of commercials would provide the needed redundancy to avoid impact from any utility failure. Given how common utility failures are and the negative impact of power disruptions at a professional sporting event, this looks like good value to me.”

Hamilton also suggests in the post that facility operators frequently test equipment, use automated recovery, use more utility breakers to decrease the amount of a facility an outage could wipe out and simply steer clear of sites in fault zones altogether. In short, big facility operators might want to think more like the cloud guys.

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Alas the cleantech sector has yet to see its own Moore’s Law, though the closest might be that solar cells and panels have dropped dramatically over the past 18 months. But even if Sandalow couldn’t promise a Moore’s Law for energy, he laid out some of the most important trends that the DOE is paying very close attention to in the energy sector in 2013.

1). Grid resiliency and modernization: Both the Superbowl blackouts and hurricane Katrina have highlighted how important it is to make the grid much more resilient to blackouts as well as cyber events. The threat of cyber attacks “is real,” and it’ll be the private sector who mostly will lead the response against these situations, said Sandalow. Having a much more robust grid will also be needed as utilities add more clean power, like wind and solar, onto the grid.

2). Low cost natural gas: Cheap U.S. natural gas, which has emerged through horizontal drilling and hydraulic fracturing, is the “hottest topic in the energy area,” said Sandalow. The DOE is accepting comments right now for whether or not the U.S. should export liquid natural gas. We have 16 applications for companies that want to export it, said Sandalow.

3). The dropping cost of solar: The DOE has its SunShot program, which looks to lower the cost of solar panels, but there’s a lot more work left to do. Germany has a 50 percent lower cost to install solar panels because it removed a lot of the red tape, said Sandalow. He explained, “I want to know when solar will become viral in the way that cell phones did, and what will it take, energy storage?”

4). Electric vehicles: The DOE has done a lot of work with electric vehicles and charging infrastructure, and we plan to do a lot more, said Sandalow.

5). High performance computing and big data: The trend of big data analytics and the most powerful computers in the world will no doubt help crack the problems with energy innovation. They are already being used heavily in the energy and climate change monitoring sectors.

6). Clean energy financing: There’s a lot more work to be done to finance clean power projects, though some milestones passed recently like the tax credits for wind projects. For startups clean power financing is actually a pretty hot area for investment.

7). China: Sandalow says he’s been to China 13 times while he’s been in office. The relationship between the U.S. and China over energy has at times been challenging, says Sandalow, but the trend of Chinese investments being made into cleantech companies in the U.S. is really interesting, and “I expect to see more of it.”

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