We can thank China, offshore wind and European solar rooftops for a record $243 billion of global investment into clean power — including funding mechanisms like the public markets, private investment, government funding, asset financing and corporate spending — according to new figures out from Bloomberg New Energy Finance. That is a whole lot of money, and a good reason for greentech companies and entrepreneurs to remain optimistic despite a potential back off from greentech VCs in Silicon Valley.
In fact, that $243 billion total is over 30 times what greentech VCs spent in 2010 by themselves, and according to the Cleantech Group venture capitalists invested about $7.8 billion into 715 deals over the same time period. Which begs the question, does green technology really need the VC community’s investment all that much?
Well, a big chunk of the Bloomberg New Energy Finance total is from asset financing, which provides money for building out mostly utility-scale clean power infrastructure. VCs don’t have those type of funds, nor the desire to do that type of investing. Likewise government funding, and corporations, are also providing a sizable amount of money right now for basic greentech R&D, and VCs mostly don’t want to be in that game either.
But where VCs do excel historically (though current greentech investing hasn’t proven this out yet) is by finding disruptive startups that can be game changers — ie. the long sought-after Google of greentech. Until there’s a good greentech distruptor candidate to point to, that type of investing is hard to quantify.
In the meantime, here’s a break down of the different types of clean power funding in Bloomberg New Energy Finance’s global figures for 2010:
- Global distributed clean power, which is largely rooftop solar, generated $59.6 billion in investment.
- Clean power investment in China jumped to $51.1 billion.
- Global government R&D spending hit $21 billion.
- Corporate clean energy R&D spending reached $14.4 billion.
- Public market investments for clean power generated $17.4 billion, which was below the 2007 public market figure of $24.6 billion.
- Asset financing, which is mostly for utility‐scale wind, solar and biofuel projects, generated $127.8 billion.
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