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1. Sigma Designs Buying Smart Network Chipmaker Zensys
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2. Daily Sprout
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3. Cleantech VCs New Year's Resolution: Be Conservative
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4. U.S. Tech Companies Unite For Car Batteries, Seek Gov. Aid
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5. A Few Tidbits On Khosla-Backed Battery Startup Sakti3
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6. Chrysler to Slam Brakes on Manufacturing for a Month (or More)
Sigma Designs Buying Smart Network Chipmaker Zensys
David Ehrlich - Big Green
California chipmaker Sigma Designs is getting into the smart device and energy management market. The company announced today that it signed an agreement to buy Zensys, which makes wireless mesh network chips for residential and light commercial building control systems. Sigma, which makes multimedia chips for TVs, DVDs and computers, said it’s an all-cash deal but did not release the financial terms of the agreement.
Zensys, also based in California, makes single-chip radio frequency (RF) systems using its proprietary Z-Wave communications protocol, which Sigma says has already been used in more than 250 smart products around the world. Wirelessly networked devices can be monitored and controlled for energy management, helping to lower energy costs by controlling lighting, heating, cooling and other systems in buildings.
Many other startups in the smart energy device market, including Trilliant, Tendril, and Adura Technologies, are using the ZigBee protocol, part of an industry-wide collaboration. ZigBee is a formidable competitor for Z-Wave; today, we hear that CenterPoint Energy has received approval from the Texas Public Utilities Commission to roll out 2.2 million ZigBee-enabled smart meters. And in late July, the Texas PUC approved a similar plan from Texas utility Oncor, which will add 7 milliion ZigBee-enabled Landis+Gyr smart meters by 2012.
Zensys started its own industry consortium, the Z-Wave Alliance, with members including heating and cooling systems manufacturer Danfoss International; climate control, industrial and security technologies company Ingersoll-Rand; and Leviton Manufacturing, which makes electrical and electronic components. According to Sigma, Zensys is currently shipping more than a million RF chips per year.
Zensys is backed by some big names in the electronics industry, with its latest investment coming from Japan’s Panasonic in March. The size of that investment was not disclosed, but Bessemer Venture Partners led a $16 million third round for Zensys in 2005. Other investors include Intel Capital, the investment arm of Intel; Cisco Systems; Palamon Capital Partners, and Sunstone Capital.
With the acquisition, Zensys’ headquarters in Fremont will be merged into Sigma’s head office in neighboring Milpitas. Sigma said the Zensys research and development center in Copenhagen, where most of Zensys’ workers are based, will remain in place. Zensys has 33 employees, including 23 engineers. Sigma said the deal, which is subject to standard closing conditions, is expected to close by the end of this year.
Stacey Higginbotham and Celeste LeCompte provided additional reporting for this story.
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Daily Sprout
Josie Garthwaite - Misc
OPEC Cuts and Prays, Market Doesn’t Buy It: After OPEC said it would cut output by 2.2 million barrels per day, oil prices fell. Why? The market doesn’t believe under-pressure governments will comply with revised quotas. — WSJ’s Environmental Capital
EU Automakers Speeding Past U.S. in EV Race: Longstanding high energy costs, strong desire to reduce reliance on foreign oil, and absolute commitment to shrinking carbon footprint gives Europe an early lead in the race to deliver electric cars. — CNET
Wind on Demand: Ontario and several U.S. states are taking a closer look at compressed-air storage as a way to supply the electric grid with wind power when it’s needed. — Toronto Star
Currency Switch to Help Solar?: With sales denominated largely in Euros, the strengthening U.S. dollar has created drag for solar stocks this year. If the dollar starts to sink, the exchange rate could become a tailwind for First Solar, SunPower and Chinese solar companies. — Barron’s Tech Trader Daily
Greens, Business Sparring Over Columbia River Span: President-elect Barack Obama’s pledge to invest in infrastructure has sparked new interest in a $4 billion bridge-improvement project that could reduce traffic congestion between Oregon and Washington. Environmental advocates staunchly oppose the project. — NYT’s Green Inc.
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Cleantech VCs New Year's Resolution: Be Conservative
Josie Garthwaite - Startups
Millennium Finance Corp. of Dubai plans to launch a $200 million fund for renewable energy investments in partnership with Chicago-based Advanced Equities. The fund, set to be managed from a new office in India, will focus on “late-stage firms with low technology risk and established revenue streams,” Cleantech Group reports. In other words, it will serve as Exhibit A for the National Venture Capital Association’s forecast that VCs will steer clear of seed and early-stage companies in 2009. Translation, courtesy of Om Malik: In a stormy year, venture capitalists will be hiding under their desks.
Much ado has been made (here, here and here, for example) of the prediction that clean energy will fare better than most sectors on the financing front (it was the only sector in which survey respondents said they thought investments would increase in 2009).
To be sure, $200 million is a drop in the bucket for a sector that saw $4.6 billion of investment in the first three quarters of 2008, an increase of 82 percent over the same period last year, according to a report released today by Ernst & Young. But if Millennium’s safe-bet strategy is any indication of investors’ approach to clean energy in 2009, then early-stage startups with potential to lead innovation in the coming years may end up spinning their wheels instead. Still, the fund is a likely boon for India, which the National Venture Capital Association expects to be hit hard by loss of capital in 2009.
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U.S. Tech Companies Unite For Car Batteries, Seek Gov. Aid
Katie Fehrenbacher - Automotive
Electric vehicle makers in the U.S. have often complained that Asian firms are dominating the battery market, making it difficult to find battery options domestically — heck, even chip-maker Intel has been advised to look into the market partly because it’s so sparse. This morning, a group of more than a dozen U.S. tech companies say they are looking to solve that problem; they’re teaming up to build a plant to make next-gen electric vehicle batteries and asking the U.S. government for $1 billion to support the plan, according to the various media reports.
If the method — U.S. firms join up to battle Asian dominance — sounds familiar to all you old-school tech-watchers, that’s because it is. The group is modeling itself on Sematech, a coalition formed by U.S. chip companies in the late ’80s to compete with Japanese firms. The car battery consortium, known as the National Alliance for Advanced Transportation Battery Cell Manufacture, comprises: 3M, Johnson Controls, Saft, FMC, EnerSys, ActaCell, All Cell Technologies, Altair Nanotechnologies, Eagle Picher Industries, Envia Systems, MicroSun Technologies, Mobius Power, SiLyte, Superior Graphite and Townsend Advanced Energy.
The group, which is also being advised by Argonne National Labs, is planning to ask the Obama administration for roughly $1 billion in aid and loan guarantees, according to the Wall Street Journal (Reuters says it could be as high as $2 billion). The funds would be used for a shared advanced battery plant so the firms could bring down the cost, and raise the efficiency and performance of lithium ion batteries. With all the other auto companies and troubled industries also asking for handouts, we’re not sure how viable it is for the new group to secure that funding. But at least the consortium’s entire purpose is to research the next-generation of technology, and the funding wouldn’t go to prop up older failing business models (that’s you, Big Three).
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A Few Tidbits On Khosla-Backed Battery Startup Sakti3
Katie Fehrenbacher - Startups
We’ve heard very little about the early-stage vehicle battery startup Sakti3, only that the company had been backed by Vinod Khosa’s firm Khosla Ventures. The Detroit Free Press has an interesting article this week that reveals a few significant details about the tiny Ann Arbor, Mich.-based company.
First off, the article says Sakti3 is working on advanced lithium-ion battery technology for electric vehicles, and that the battery will be more advanced than either A123 Systems or LG Chem’s Compact Power, which are both working with GM on their electric vehicle the Volt. (We’re thinking that the notion that Sakti3’s tech is more advanced than those competitors is Sakti3’s claim, not an independent study done by the reporter). But the fact that the company is working on lithium-ion battery tech is interesting, as Khosla Ventures has often described the company as “a thin-film battery developer.”
The article also looks into the company’s young history. The technology is the brain child of University of Michigan professor of mechanical, biomedical and materials science, Ann Marie Sastry. She founded Sakti3 last year based on research she and students had done at University of Michigan. The company has fewer than 10 employees, raised $2 million from Khosla and $3 million from the Michigan Economic Development Corp., and received $2.4 million in tax credits over 10 years from the state, too.
Sakti3 is one of only a couple battery bets from Khosla Ventures, which took a very large and early chance on biofuels. Beyond Sakti3, Khosa has invested in: Firefly Energy, which makes longer lasting and more efficient lead-acid batteries and was spun out of the R&D labs of Caterpillar in 2003; and Seeo, which Khosla Ventures describes as a lithium metal battery with energy density and cyclability.
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Chrysler to Slam Brakes on Manufacturing for a Month (or More)
Josie Garthwaite - Automotive
Chrysler will idle all manufacturing operations for at least a month, with assembly-line shutdowns beginning at the end of tomorrow’s shift. The smallest of the Big Three said Wednesday workers will not return to factories any sooner than Jan. 19 — a significant extension of the automakers’ typical two-week holiday slowdown — “due to the continued lack of consumer credit for the American car buyer and the resulting dramatic impact it has had on overall sales in the United States.”
In September, Chrysler unveiled plans for a line of plug-in hybrids and electric vehicles. The company said 100 vehicles would roll out in government and commercial test fleets in 2009, and production of at least one consumer-market model would begin in 2010.
With 2009 off to such a rocky start, the timeline may change (although it shouldn’t come as a surprise: shortly after the EV announcement, Chrysler revealed to dealers that it had already lost $400 million in 2008, leaving few resources for R&D on the new line). Then again, Chrysler’s Big Three comrade/rival GM confirmed it will stop work on a parts factory for its Chevy Volt and Cruze, but said it does not expect it to affect the delivery schedule.
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