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Peter Thiel funds tornado power: seriously

Katie Fehrenbacher — Mon, 17 Dec 2012 04:21:03 +0000

Peter Thiel, famous for co-founding PayPal and being an early investor in Facebook, has put a small grant of $300,000 into a Canadian inventor who has spent years working on the idea of harnessing man-made tornadoes to produce power. The funding was made through Thiel’s Breakout Labs, which is part of the Thiel Foundation and which gives small rounds of funding for cutting-edge, early-stage science and technology research ideas.

The entrepreneur behind tornado power is Louis Michaud, who is a Canadian engineer that has spent years “trying to be taken seriously,” as Toronto Star reporter Tyler Hamilton describes him (he profiled Michaud in his book Mad Like Tesla). Michaud’s startup is called AVEtec and his technology is called the Atmospheric Vortex Engine (AVE). Breakout Labs describes the technology as:

In his design, warm or humid air is introduced into a circular station, where it takes the form of a rising vortex, i.e. a controlled tornado. The temperature difference between this heated air and the atmosphere above it supports the vortex and drives multiple turbines. The vortex can be shut down at any time by turning off the source of warm air.

AVEtec says vortex-power can deliver energy that is carbon emissions-free, and super cheap at 3 cents per kilowatt hour (coal can be anywhere from 4 to 5 cents per kwh, and it’s got some of the highest carbon emissions).

The problem is that the tornado power has to be created in a large power plant, and that has yet to be built and tested at scale. The column of the tornado in a commercial-size plant would be 130 feet tall. Reporter Hamilton says Michaud’s plan eventually is to create tornadoes using waste heat from power plant or industrial factory and then harness those vortexes.

AVEtec will work with Lambton College in Ontario to build and study a prototype using the funding from Breakout Labs. Breakout Labs has also funded Modern Meadow, which combines in-vitro meat with 3D printing.

Thiel clearly has an interest in backing early stage research around new ways to use resources from energy to food to water. Despite that he was widely quoted as saying cleantech has been a disaster, he’s taking more of an ARPA-E style approach for cleantech through Breakout Labs. Thiel has also put money into LightSail Energy, a startup that makes a next-generation compressed air energy storage technology.

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10 things to be thankful for this year in cleantech

Katie Fehrenbacher — Wed, 21 Nov 2012 08:00:00 +0000

Let’s not sugarcoat it like that pecan pie you’re going to eat tomorrow tonight. Cleantech, or whatever you want to call the sector these days, has had a hard year. The politicization of cleantech in an election season, fewer venture capitalists funding new companies this year, and widespread solar bankruptcies were all hurdles that cleantech entrepreneurs, investors and innovators had to face in 2012.

But there were also quite a few things that excited me this year, which in honor of our upcoming day of thanks, I’ve decided to call out. Here are 10 things to be thankful for in cleantech.

1). Obama won: Thank goodness. The entire cleantech sector dodged a bullet — and breathed a sigh of relief — as the votes rolled in and President Obama was re-elected for a second term. Obama delivered an unprecedented amount of cleantech funding: billions in incentives for clean power, electric cars and energy efficiency through the stimulus package. While the incentives won’t likely be as high as they were when the stimulus package was determined, if Mitt Romney had won, it would have likely been a real blow for cleantech. Romney is a self-professed coal-lover, who used speeches to point out misspending for clean power companies, and made a now infamous joke (post Sandy) about climate change.

2). New solid customer: Internet infrastructure: A growing amount of Internet companies — and web infrastructure providers — are looking for ways to add more clean power to their data center energy consumption mix, and are also looking for ways to be less reliant on the power grid. Some of the leaders in this area include Google, eBay, Microsoft, and Apple, and many of these companies have invested in both solar systems, energy efficiency technology and even fuel cell farms. Fuel cell maker Bloom Energy has managed to find a niche and growing market here.

There’s also a growing trend of IT companies looking to utilize low power servers — servers built off of low power cell phone chips. AMD this year acquired startup SeaMicro, and weeks ago AMD launched its SeaMicro low power server. Calxeda just raised $55 million to move toward commercializing its own low power server product.

3). Digital green, or clean web: Cleantech — from a VC and entrepreneur perspective — is in a transitional state. But in the meantime, clean technologies that are based on IT — like mobile, big data, cloud computing, software — are still seeing a lot of innovation and investment. Examples of startups in this sector include Opower, Nest, Solar Mosaic and Sungevity. Investors are calling this sector different things — Greenstart calls it digital green, Spring Ventures calls it Clean Web, and MDV calls it where cleantech meets IT — but it all means the same thing to them: a way to make money that more closely mimics making VC investments in web and mobile companies.

4). Smart thermostats: A particularly interesting area to me in terms of the smart grid and cleantech startups is the growing use of thermostats that are connected to the internet and that can smartly cut building energy use. Nest says it’s sold in the mid-hundreds of thousands of its learning thermostats, which can learn the users behavior and shave off energy consumption overtime. EcoFactor’s service is being used in a commercial deployment in Las Vegas, and Opower’s software is being used in three utility trials with Honeywell’s thermostats. Startup EnergyHub is also working on providing the software for smart thermostats.

Connected thermostats could be the answer to what utilities call demand response, which is basically turning down the energy use of its customers during peak times of day. The customers agree to the programs and can see lower energy bills. If the system is automatic and non-intrusive — which can be done using smart thermostat analytics — customers are far more likely to join the programs, and the utility’s results are better.

5). Tesla: Electric car maker Tesla has one of the most ambitious ideas in cleantech, and has actually — mostly — delivered on its goals. Yes, it was slow to get its estimated volume of Model S cars out to owners in 2012, but it’s on track to deliver its new estimates over the coming months. The company is also one of the few cleantech ideas that have captured the imagination of the public, and recently won Motor Trends’s car of the year award — the first time in history that an electric car won it.

6). The learning curve: Like I said, cleantech is in a time of transition. And I think that’s a good thing. As Greenstart founding partner Mitch Lowe said on a recent panel I moderated, fewer companies are being funded, but that just means the bar is higher. While bubbles are fun — like the one that grew in cleantech between 2006 and early 2008 — bubbles mean a lot of stupid money is flowing. Hopefully the smarter money of the next 18 months will deliver some breakthrough cleantech startups.

7). Cheap solar panels: One of the most dramatic clean power economic factors to emerge in 2012 occurred via super cheap solar panels coming out of China. While rock bottom solar panels make a difficult market for competing solar manufacturers, that ecosystem has created a boom in solar panel installations. In the U.S. there are now 250,000 rooftop solar panel installations, and companies like SolarCity are seeing large growth.

8). Wish for big ideas: Outside of cleantech, in the general tech and IT markets, there’s been a growing drumbeat of entrepreneurs and investors calling for greater attention on “big ideas.” While there can be easy money in social media and mobile apps ($1 billion for Instagram), there’s an emerging discussion around technology being used for higher aims, like solving problems for resource constraints. Investor Peter Thiel has been a chief champion of this approach and recently created a growth fund that will tackle big problems — the fund has already backed firms like compressed air energy storage startup LightSail Energy. They’re not calling it cleantech, but it is under the hood.

9). Meat 2.0: When the population explodes to 9 billion people by 2050, livestock for consumption could become a constrained resource — particularly because the emerging middle class in developing countries are increasing their meat consumption. That’s one of the reasons that innovation is occurring around fake meat. As Greentech Media wrote, paraphrasing a VC: “having a “fake meat” company in one’s VC portfolio was becoming a must-have, like having a cloud computing firm or a failed thin-film solar company.” Beyond Meat is one startup and Sand Hill Foods seems to be another. Modern Meadow ~~Meat~~ is a startup working on meat manufacturing, with backing from Thiel.

10). Collaborative consumption: And another sector of cleantech that’s not really cleantech: sharing goods. The next-generation of young people are less interested in owning things, and more interested in gaining access, or using things as a service. That makes the use of goods more efficient and sustainable. You don’t need to buy a car, because you can pay for access via Zipcar. There’s tons of startups in this space from giants like Airbnb, to new comers like electric scooter rental startup Scoot Networks.

Image courtesy if Aine D, waywuwei,

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In the post-Solyndra era, still some (rare) big bets left for cleantech

Katie Fehrenbacher — Wed, 07 Nov 2012 08:00:50 +0000

This week a young startup with a potentially disruptive energy technology was able to do something pretty rare these days: it managed to raise a large round from some of Silicon Valley’s leading venture capitalists. And no it wasn’t a digital-based energy technology (or Clean Web as it’s being called these days) — the $37 million in funds were for LightSail Energy’s compressed air energy storage technology, which could eventually be pretty capital intensive to scale up and commercialize.

About five years ago, cleantech startups with ambitious ideas were commonly able to raise such rounds to build next-gen solar panels, electric cars and battery technologies. But over the past 18 months, in the post-Solyndra era, the mood of many venture capitalists toward cleantech has decidedly soured. Not many investors have yet to make money and most new cleantech startups are finding it particularly difficult to raise large rounds for anything that requires much scale.

Which is what makes LightSail Energy’s ability to secure funding from Peter Thiel — who was once quoted as saying cleantech has been “a disaster” — along with Khosla Ventures and Bill Gates a total outlier. “There have been a lot of broken promises that didn’t work out the way people thought they would,” says LightSail Energy’s CEO and co-founder Steve Crane in an interview explaining the cleantech startup and investing bubble of previous years. Crane says Thiel’s widely quoted comment about a cleantech disaster was really about how investors made bad choices when picking investments, and that the right solutions hadn’t yet emerged.

Crane is hoping LightSail will be one of those right solutions — and a winning bet — for his investors. Compressed air storage is a decades-old technology which takes excess energy from a power plant or renewable energy and uses it to run air compressors, which pump air into tanks where it’s stored under pressure. When the air is released, it powers a turbine, creating electricity. LightSail is making a very efficient version of compressed air energy storage that can be paired with solar and wind farms.

But Crane is still cautious of making too many claims too early about the technology, given it isn’t yet a commercial product. In 2014, LightSail plans to finally have its first commercial air energy storage product available for customers like solar and wind farm developers. The air tanks can store solar and wind power when it’s in excess, and bank it for use at a later time. In the meantime, Crane is holding back on key details, like how much the technology will cost (a key factor that will determine its success).

Throughout 2013, LightSail Energy will work on tweaking its second generation prototype, which is currently a large — 6-foot, by 15-foot — machine that is just bigger than a shipping container. The company will work at making the device as efficient as possible, and also able to last the two decades required for installing it on the power grid. The device will eventually have a 70 percent trip efficiency, which is a lot higher than the standard compressed air storage technologies of yesteryear.

LightSail’s third generation prototype will be close to its commercial product and will hopefully fit in a shipping container, says Crane. That will make it cheaper to ship. The three factors that LightSail will focus on working out in 2013 will be “cost, durability, and efficiency,” says Crane, adding “efficiency is the hardest one of all. There are dozens of places where it can lose efficiency.”

LightSail’s recent round was a D round, and Bill Gates and Khosla Ventures were already backers of the tech before this round. Investors are of course more willing to provide follow-up financing. Capital intensive startups are finding it particularly hard to raise early stage and A rounds.

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The startup behind Bill Gates’ ‘ski lift for energy storage’

Michael Kanellos — Mon, 26 Mar 2012 02:00:27 +0000

Last week, Bill Gates mentioned that he’s involved with an energy storage company that was basically “gravel on ski lifts” at the Eco:nomics Conference organized by the Wall Street Journal. (Thank you, Katie Fehrenbacher, for attending.) (See video, minutes 19:15 to 20:10).

Ski lift storage has been one of those topics discussed in the hallways of energy storage conferences for years. Someone was out there, the conversation went, that wanted to use a solar- or wind-powered ski lift apparatus as a pump. It would pump gravel or water up a hill during sunny periods. At night or during peak power emergencies, the gravel or water could be released. The system essentially artificially supplies the elevation that nature left out.

Such a system could even harvest regenerative power on the way down. It’s part of a segment I call macro or terrestrial storage, i.e. large mechanical devices that store power through the power of geography and gravity. Bright Energy Storage Technologies, for instance, wants to put giant plastic bags shaped like sea cucumbers connected to air hoses in the ocean. Seawater will contain and pressurize the water for free. It sounds strange, but the device could deliver power for 2.5 to 6 cents a kilowatt-hour, say the backers of the technology.

Research and project management company Escovale Consultancy Services talks about using a 100 million ton stone in a cavern to pressurize water, similar to an idea being pursued by Gravity Power. Think Stonehenge for the grid.

Then there are the micro-macro storage ideas: SustainX (compressing air in large tanks with water vapor), Isentropic (big tanks of hot gravel) and LightSail Energy (founded by an entrepreneur who entered college at age twelve.)

I scribbled down the name of the ski lift guys once at the Energy Storage Association conference in 2011, but I subsequently needed a paper towel and lost it forever.

Energy Cache

So who is that company? I am going to guess it is Energy Cache. Energy Cache wants to create a solar-powered pump for delivering materials to the top of mountains that can be released to produce energy. Here is one of their patents — note that one of the inventors is Bill Gross, the energetic dervish behind Idealab.

Claremont Creek Ventures is an investor and Idealab lists the company on its site. Gates himself wrote about the company in 2011 on his own blog.

Here’s a video of how the system works:

It’s an interesting idea, but one with many caveats. Terrestrial storage isn’t cheap. Compressed air energy storage, pumping megawatts of air into underground caves, has been around since the 1970s, but only a few trial systems have been built. Big projects take a lot of cash, and almost anything — geological surprises, changing world economics — can go wrong in the ten to fifteen years it can take to complete a project.

Environmental review can bottle up projects for years. Gridflex Energy has talked about building multi-megawatt hydro storage systems in Hawaii — the ocean would act as a free reservoir — and large systems in Montana. But good luck getting through the review process.

Some of the energy ideas from Idealab have stalled on the way to commercialization. Energy Innovations, a startup building concentrated solar photovoltaic technology, has reportedly put itself up for sale after struggling. Idealab also invested in Aptera, the three-wheeled electric car. The lightweight material Aptera used to build its car was fantastic — the car didn’t do so well.

Image courtesy of Andrew Miesem, Flickr creative commons and Energy Cache.

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