Stimulus packages drive clean tech investment recovery

30 September 2009 22:08  [Source: ICIS news]

NEW YORK (ICIS news)--Venture capital (VC) investments in clean technologies continued to increase in the third quarter, propelled by government stimulus funding worldwide, an industry information group said on Wednesday.

Clean technology investments in North America, Europe, China and India for the third quarter totalled $1.59bn (€1.10bn) - up by 10% from the second quarter, according to the preliminary results of a joint study by market information provider Cleantech Group and consultancy group Deloitte.

Cleantech Group defines clean technology as a diverse range of products, services and processes that are intended to reduce or eliminate negative ecological impacts while at the same improving the productive and responsible use of natural resources at lower costs and with improved performance.

“Government funds targeting clean technology have emboldened private capital investments,” said Dallas Kachan, managing director of Cleantech Group.

“Many of the top venture deals and largest IPOs [initial public offerings] in the US have benefited from government funding,” he added during a conference call held by Cleantech Group and Deloitte.

Leading clean technology investment markets in the third quarter include solar, transportation (vehicles, biofuels and advanced batteries), and green buildings.

Investment in solar technology rose to 28% of the total global venture investment in the third quarter, up from the previous quarter’s 13%, said Kachan.

However, investment in solar was down to $451m in the third quarter compared with $1.2bn in the year-ago period.

US investment in clean technology transportation was boosted by the $2.4bn stimulus funding for advanced battery and electric vehicle developments announced in August by the Department of Energy, added Kachan.

Around 27 deals have been announced within the clean technology transportation sector in the third quarter, which totalled $383m, he said.

The green building sector, which includes energy efficient buildings, glass and lighting saw a total investment of $110m.

Clean technology was the largest venture capital category, accounting for 27% of investment, followed by biotechnology (24%), software (18%), and medical devices and equipment (17%), said Kachan.

 ($1 = €0.69)

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By: Doris de Guzman
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