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1. DOE to Invest $47M in Data Center Efficiency Projects
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2. GM's Volt to Launch With Cell Phone App for Remote Control
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3. After IPO, A123Systems Endures a Fickle Market
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4. Special Event: FCC Chairman to Talk Broadband Policy at GigaOM
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5. New Federal Windfall for 'Community Wind' Farms
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6. Daily Sprout
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7. Think Picks Indiana for Electric Car Plant
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8. GM to Fire Up Battery Plant This Week, a First for U.S. Automakers
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9. Battery Startup K2 Energy Teams Up With UPG
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10. A Quiet Smart Grid Software Player to Watch: Ecologic Analytics
DOE to Invest $47M in Data Center Efficiency Projects
Katie Fehrenbacher - Green IT
Surprisingly some of the biggest recipients of the DOE funds are data center-focused startups like the stealthy SeaMicro — which received $9.3 million and is backed by Khosla Ventures, Draper Fisher Jurvetson and Crosslink Capital — and PowerAssure, a 3-year-old firm that makes data center efficient software and received $5 million from the DOE.
The older web and Internet infrastructure firms took a big chunk of the funds, too. Yahoo received $9.9 million for a data center cooling project, Hewlett-Packard won $7.4 million for a power supply chain project, the IBM T.J. Watson Research Center brought in $2.3 million for an equipment and software project, telecom gear company Alcatel-Lucent got $1.8 million for a cooling project and Alcatel-Lucent’s Bell Labs won $300,000 for an equipment and software project. A couple universities — Columbia University and the California Institute of Technology — also won funds.
Chu explained in a conference call this morning that the DOE funds were split into three groups: 1). reducing the energy of core systems like servers, 2). reducing the power loss at the connection point to data centers, and 3). finding more efficient ways to cool servers and data centers. More energy efficient data centers could save 400 trillion BTU’s of energy per year (equivalent to the amount of energy used by 2 million homes each year), significantly reducing operating costs for companies and create new jobs, said Chu on the call this morning.
The energy used to cool data centers sucks up 40-60 percent of the total energy consumption of data centers, so we’re glad to see Chu giving a nod specifically to cooling. Grantees of DOE funds for cooling projects included: IBM T.J. Watson Research Center ($2.3 million), Federspiel Controls, Inc. ($584,000), Yahoo ($9.9 million), Alcatel-Lucent ($1.8 million) and Edison Materials Technology Center ($2.8 million). Here’s the full list.
While $47 million really isn’t all that much funding (in comparison the smart grid got $4 billion of stimulus funds) the announcement will be important to bring attention to geeky, and sometimes overlooked, data center efficiency technology. In particular companies like SeaMicro, with truly innovative technology, could end up being be game-changers (more on that firm later today).
Image courtesy of s_w_ellis’ photostream Flickr Creative Commons.
GM's Volt to Launch With Cell Phone App for Remote Control
Josie Garthwaite - Automotive
Sound familiar? It’s a heckuva lot like the app unveiled by Nissan for its all-electric LEAF last summer. Nissan’s app was still in the development stage at the time, and GM is now calling its Volt the “first electric vehicle to demonstrate wireless smartphone application,” and “the auto industry’s first working smartphone application” that will provide Volt owners with constant connection to vehicle functions and features of GM’s OnStar system, such as remote door unlocking. Prior to this app, GM notes OnStar features “have typically been accessible only through a call into the OnStar call center.”
These types of apps are a key piece of the emerging Car 2.0 era — the idea that the next generation of cars will be networked to the power grid as well as communication networks, and will have the ease and functionality of our consumer electronics.
For GM, the so-called OnStar Mobile Application could also be a key part of marketing the vehicle to gadget-minded consumers. The automaker says that with this app, the Volt “showcases technology beyond the battery,” something GM needs to do to go beyond niche markets for a $40,000 plug-in sedan. As Andrew Farah, vehicle chief engineer for the Chevy Volt, recently emphasized in a call with reporters, “Our whole goal here is to put together a great vehicle for customers, not just a battery on wheels.”
A demo of the app for iPhone will be available on iTunes starting Jan. 6. More demo screen shots are available here.
After IPO, A123Systems Endures a Fickle Market
Kevin Kelleher - Big Green
A123System's offering priced at $13.50 a share on Sept. 23, well above its previous proposed price range of between $8 a share and $9.50 a share. Its share price surged 50 percent on its first day to close at $20.29. But by late November, it had fallen back below $15 a share as Goldman put a price target of $14 a share on the stock, arguing that good news had been priced in. Goldman, a lead underwriter of the IPO, helped determine that offering price.
But Goldman's sober outlook couldn't hold the stock down for long, and A123's shares are back at $22.39 as of Tuesday's close. The rebound was helped along by a joint venture with SAIC Motor Corp., a major Chinese carmaker, to sell battery syStems for electRic vehicles in China just as cleantech and auto sales are seeing growth in that country. At the time, an A123 executive told Reuters that the company was “looking to be basically the market leader in China, both in the truck and passenger car market.”
That turbulence may continue for a while. In a recent research note, Deutsche Bank said it expects battery prices to decline about 25 percent by 2015 from the current level of around $500 per kilowatt hour. Following a tour of A123System's battery plants in China and Korea, Deutsche Bank felt that the company was ready to scale up to meet bigger demands.
"The maturity of operations, level of automation, and depth of manufacturing experience within each company’s subsidiaries gave us increased confidence that production scaling is a manageable risk."
That makes for a potentially bountiful future, but the problem for investors today is that revenue and profits at A123Systems should begin to ramp up after 2012.
Meanwhile, there is the issue Goldman raised, which is that all the attention that A123Systems attracted in the IPO — which was the largest of 2009 — may have left it overpriced for the time being. Another analyst, Theodore O'Neill at Kaufman Brothers, saw a better bargain in Ener1, which shares some similarities with A123Systems.
“Both companies have multiple automotive and mass transit partners, not all of which have been disclosed… Both companies are pursuing consumer electronics, automotive and frequency regulation markets. Both companies have plant capacity… According to First Call, both companies are expected to report approximately $300 million in revenue in 2011.”
But a key difference is that Ener1 is trading at two times its estimated 2011 sales, while A123Systems is trading at six times. As a result, O'Neill said, "we believe the disparity between HEV and AONE is unsustainable."
Special Event: FCC Chairman to Talk Broadband Policy at GigaOM
Katie Fehrenbacher - Green IT
Om Malik, the founder of GigaOM, and Stacey Higginbotham GigaOM senior writer, will be interviewing Genachowski on topics like broadband policy, net neutrality, disappearing landlines, cable disputes, Google Voice and Apple's stance on app approvals. But I’ll make sure to squeeze in a question from my seat in the audience about how Genachowski plans to work with and regulate the smart grid. Polaris Ventures investor and ethernet inventor Bob Metcalfe has called on the FCC to help get energy networking right through its national broadband plan.
You can tune into GigaOM.com to watch the conversation live. If you’re just dying to be at the event, we have a few seats left, so send a note to events@gigaom.com with "FCC FORUM" in the subject line. If we can accommodate your request we will.
New Federal Windfall for 'Community Wind' Farms
Ucilia Wang - clean power
For the first time in several years, community wind farm developers — which are defined by the report as local owners and operators (not utilities) instead of national or international developers — can rely on more federal aid and circumvent some pesky regulations that made it difficult to complete their projects before. The stimulus package now allows wind companies to opt for a 30 percent investment tax credit or the cash equivalent of that amount, instead of the production tax credit, the report said. The investment tax credit or the cash, which is based on the amount of money spent on building a project, is more valuable for these smaller project developers than the production tax credit because community wind power plants generally are more costly to build install per kilowatt of generation capacity and generate less power than the utility-size farms.
The investment tax credit and grant programs also do away with other rules that have limited community wind farm build-outs in the past. The programs exempt the recipients from the alternative minimum tax, whereas the production tax credit program exempts only the first four out of 10 years of a project’s operation, the report said.
The production tax credit is clearly less attractive to community wind developers than the investment tax credit. The production tax program requires wind farm owners to also be operators; the investment tax and grant programs do not, and that opens up leasing opportunities. The amount of production tax credit could also be lowered if a wind farm operator receives federal or local government loans or grants for building the project.
To prove its point, Berkeley Lab showed that a 10.5-megawatt community wind farm that takes advantage of the cash grant instead of the production tax credit could lower the amount of cash revenue that needs to be generated to hit its investor’s target return by $40 per megawatts-hour. Of the $40/MWh, $15/MWh would come from using the grant and the rest from avoid tax and other penalties.
Although the stimulus programs are a nice boon for community wind project developers, they aren’t going to be around for long. A project must be operating by the end of 2012 to qualify for the investment tax credit. For the grant, a project has to be online by the end of 2010 or at least start construction by that time and begin generating power by the end of 2012. So far, the government has doled out just over $1 billion from the cash program, and Iberdrola, a Spain-based commercial wind farm developer, has gotten about $546 million.
Daily Sprout
Josie Garthwaite - Misc
Reva’s Low-Volume EV Scheme: Reva Electric Car Co., the Indian automaker developing an electric vehicle with General Motors, plans to set up four overseas automaking ventures that may be profitable building as few as 5,000-10,000 cars a year. — Edmunds Green Car Advisor
So Long Copenhagen, Hello Cochabamba: After international climate talks in Copenhagen failed to produce binding agreements last month, Bolivian President Evo Morales said Tuesday he’s inviting activists, scientists and government officials from around the world to an alternative climate conference in Cochabamba, Bolivia in April. — Associated Press via NYT
Whole Foods Chief on Climate Change: When Whole Foods CEO John Mackey told the New Yorker “that no scientific consensus exists’ about the causes of climate change, he thrust himself – and his chain – negatively into the spotlight among many ec0-minded shoppers.” Just 10 days earlier he stepped down as chairman of Whole Foods, prompting some critics to call his comments “loose talk.” — Environmental Leader
Incredible Shrinking Fleet: “The United States scrapped 14 million autos while buying only 10 million last year, shrinking the country’s car and light duty truck fleet to 246 million from a record high of 250 million, according to the report to be released on Wednesday by nonprofit group the Earth Policy Institute.” — Reuters
Energy on the Fast Track: Thirty–one proposed projects involving solar, wind and geothermal power, as well as transmission “have been put on the fast track for approval by the Bureau of Land Management, with the aim of getting them paid for with stimulus funding.” — NYT’s Green Inc.
Think Picks Indiana for Electric Car Plant
Josie Garthwaite - Automotive
Late last year rumor had it that Indiana had snagged the project, which will be located a few hours’ drive from Think battery supplier Ener1. Think aims to build out capacity for more than 20,000 vehicles per year at the Elkhart facility. The location is a logical one for Think, given that Ener1 subsidiary EnerDel will be manufacturing batteries for Think in Hoosier state.
As Bob Kanode, CEO of battery maker Valence Technologies explained to us last year, vehicle battery packs are heavy and long-distance shipping costs add up. If Think is going to hit in the ballpark of its revised target to produce a $30,000 vehicle (that’s after incentives — up from a previous goal to keep the price below $25,000), it has to keep those costs down.
Think’s compact electric City started rolling off the assembly lines last month at Finland's Valmet Automotive — an investor and strategic industrial partner that helped rescue Think from the financial brink. But whether and how Think manages to follow through on its plans for Elkhart and finance the project remains to be seen.
The company’s request for funding under the Department of Energy’s Advanced Technology Vehicles Manufacturing Program is “active,” according to today’s announcement, but like so many startups pinning hopes on a shrinking pile of DOE funds, it has yet to receive a final answer. As Think CEO Richard Canny told the Green Inc. blog today, "Our plan is based around the DOE loan…If that didn't happen we would be looking at a slower and shallower investment plan."
Photos courtesy of Think
GM to Fire Up Battery Plant This Week, a First for U.S. Automakers
Josie Garthwaite - Automotive
GM sent out a press advisory this morning saying it will start production Thursday morning, and Secretary of Energy Steven Chu, Michigan Gov. Jennifer Granholm, and GM Chairman and CEO Ed Whitacre are scheduled to attend the launch.
As GM notes in its release, the event is scheduled to take place “exactly three years to the day” from when the automaker revealed the concept for the Chevy Volt. During that time — mostly in the year or so since federal stimulus funds started opening up for battery manufacturing — the race to secure financing and set up plants to manufacture plug-in vehicle batteries in the U.S. has heated up. (We’ve mapped the green car battery buildout here.)
More than 100 companies lined up for billions of dollars in federal grants and state incentive packages designed to help spur these domestic efforts. Firms based in China, Japan, and South Korea currently dominate the market for lithium-ion batteries, and the Obama administration has sought to help shift that balance. As demand grows beyond mobile devices and laptops for advanced battery technologies to increasing numbers of plug-in and hybrid vehicles, there's an opportunity for players in the U.S. to either enter the game or expand their role.
For the Volt battery packs, GM will be using cells from Korean battery giant LG Chem’s Compact Power, but it has emphasized over the last year that developing battery pack technology and assembling the packs in-house will be a core competence that gives the automaker a competitive edge in the electric marketplace.
Battery Startup K2 Energy Teams Up With UPG
Josie Garthwaite - Energy Storage
The duo is also coming to the Consumer Electronics Show this week (check out our Green Guide to CES 2010). UPG plans to display a “high performance” electric vehicle equipped with K2 batteries at the show. And while K2 has also pursued lower-hanging fruit in the energy storage business (such as power tools), the application slated for promotion at CES is indicative of where UPG is hoping to go with this deal.
Quietly working on rechargeable battery systems since 2006, K2 Energy made the ambitious projection back in 2008 that it would see revenue grow to $30 million in 2010, up from just $2 million that year. We’re not sure if the company is on track to reach that target this year, but large partners could certainly help the company grow.
Lithium iron phosphate — the chemistry used in A123Systems batteries — represents one alternative to the lithium cobalt batteries typically used in laptop computers, and also in Tesla Motors’ Roadster. As Technology Review explains, lithium iron phosphate is less costly than metal cobalt, and while it, “stores less energy than some other lithium-ion materials, lithium iron phosphate is safer and can be made in ways that allow the material to deliver large bursts of power, properties that make it particularly useful in hybrid vehicles.”
According to a statement in today’s release, UPG President and CEO Ian Edmonds sees the agreement with K2 as a way for his firm to gain “exposure to the emerging market for electric vehicles,” an area that he expects to become “another platform for future growth.”
Both companies are hoping to expand their reach in some way through this multi-year agreement, and potentially a longer term deal down the road. UPG will essentially become the sales and marketing arm for K2 products, while K2 will provide manufacturing engineering and technical expertise. Among the services that UPG can provide are procurement, warehousing, inventory management, distribution, custom battery pack assembly and coordination of battery recycling efforts. At this point K2 does its manufacturing in Nevada and China.
A Quiet Smart Grid Software Player to Watch: Ecologic Analytics
Katie Fehrenbacher - smart grid
Last summer the folks at Ecologic told us that its software was connecting 14 million meters, including meters from large utilities like Oncor, PG&E, Austin Energy, and Puget Sound. The company, not surprisingly works a lot in conjunction with Landis + Gyr.
Smart meter data management systems provide the software-based delivery system between the smart meter and the utility’s back office. All utilities that are building smart grid networks need one, so the injection of the U.S. stimulus funds into the smart grid has been a real boon for this market. Ecologic customer IPL is receiving $20 million through the smart grid stimulus funds to build out a network. Ecologic’s claim to fame, beyond its growing customer list, is getting into the market way back in 2001 at Puget Sound.
But one of Ecologic’s biggest — and toughest — competitors is 12-year-old eMeter, which has a strategic partnership with Siemens, and has deals with UK's utility data service operator ElectraLink, and CenterPoint. eMeter’s chief strategy officer Chris King told us last year that eMeter had signed a dozen contracts with utilities, representing a total of 23 million smart meters back then, and had dozens more contracts in the works. eMeter is backed by $57 million from investors like Sequoia Capital and Foundation Capital.
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