Water: The next big opportunity


NRDC water report

Water isn’t as sexy as solar, doesn’t carry the smart grid’s geek cred or inspire green technolust like the Fisker Karma or Tesla Roadster electric sports cars. But as a new Natural Resources Defense Council report drives home, it could be one of the biggest climate-change related business opportunities of the new century.

The NRDC study focuses on California, where drought, a growing population and the specter of global warming-triggered water shortages demand innovative water efficiency policies and technological solutions. Just like California has kept its per capita energy consumption flat over the past 30 years as its population doubled through energy efficiency standards, the reports’ authors say that the Golden State must take the same approach with water.

“Such measures can help stretch limited water supplies, save businesses, money, reduce energy consumption, improve water quality, and protect local, regional, and statewide ecosystems,” wrote authors Ronnie Cohen, Kristina Ortez and Crossley Pinkstaff.

They focus on the so-called commercial, industrial and institutional sector, or CII — i.e. Big Business and Big Government — and the takeaway headline is that if those water consumers cut their consumption by implementing existing conservation technology they would save enough H2O to supply the coastal metropolises of Los Angeles, San Diego and San Francisco.

As has been oft pointed out, a great deal of energy is expended to transport and manage water — 20% of California’s electricity production is water-related, according to the state’s energy commission — and cutting water use will also slash companies’ electricity bill and, not incidentally, greenhouse gas emissions.

The report says that CII accounts for one-third of California’s urban water use. Taking such prosaic measures as installing aerators on faucets, low-flow shower heads and energy efficient commercial dishwashers and washers can save millions of gallons of water. Take toilets, for example. Urinals alone — pay attention guys — consume 15% of the water used in commercial restrooms. Switching to waterless urinals would save 45,000 gallons a year per urinal, according to the report.

More high tech measures involve deploying smart irrigation systems that use sensor networks to determine when to turn on the sprinklers at all those golf courses built in the California desert and in suburban communities throughout the state.  Needless to say, much of the opportunity in Big Water be for consultants and policymakers.

The whale in the room, of course, is Big Agriculture. Ag was beyond the scope of the NRDC report but it is the biggest consumer of water in California and has often been the most resistance to change or paying the true cost of such things as growing rice and alfalfa in the desert.

But as far as the commercial and government sectors go, the report concludes with these policy recommendations:

  • “Establish efficiency standards for water-using products.
  • Set performance-based water savings targets that provide water agencies with flexibility.
  • Prioritize water conservation above increasing supply.
  • Adopt a Public Goods Charge on water sales to provide a dedicated funding source for water efficiency programs, including expanded technical and financial assistance.
  • Encourage partnerships with—and financial support from—energy utilities and wastewater agencies.
  • Streamline the process for recycled water use.
  • Encourage volumetric pricing for sewer services.
  • Decouple water agencies’ sales from revenue.
  • Improve water use data collection and management.”

The top 10 solar utilities


Top 10 solar utilities

A solar industry trade group on Thursday released its list of the Top 10 solar integrated utilities of 2008 and it will come as no surprise that California’s Big Three utilities took the top three spots.

What is news, and a sign that solar’s reach is extending beyond the Golden State, is that six of the Top 10 solar utilities on the Solar Electric Power Association’s list hail from places like New York and New Jersey.

Still, San Francisco-based PG&E (PCG), which claimed the No. 1 slot, alone connected 84.9 megawatts of photovoltaic solar to the grid in 2008, accounting for 44% of all new solar capacity last year. Southern California Edison (EIX) came in second with 32.4 megawatts and San Diego Gas & Electric (SRE) took third place with 16 megawatts.

Xcel Energy (XEL) in Colorado was close behind with 14.2 megawatts. After that the numbers take a dive to the single megawatts. Still, utilities from not-so-sunny places like Portland, Ore.  made the list.

Southern California Edison is No. 1 when it comes to total installed solar to date — 441.4 megawatts — due largely to the 354 megawatts of electricity generated by nine solar thermal power plants built in the 1980s that continue to operate in the Mojave Desert. PG&E came in second with 229.5 megawatts connected to the grid so far.

Those numbers should skyrocket in the coming years as the California utilities have signed contracts for more than 3 gigawatts of electricity to be produced by large solar farms. Utilities like Arizona Public Service (PNW) — No. 5 on the list for 2008 — are also beginning to contract for solar electricity to be produced by massive megawatt solar power plants.

Recent deals

Here are reported cleantech venture deals from the past few weeks, showing that things are still a bit slow but the money is starting to flow into a more diversified mix of sectors:

  • GreenRoad, a vendor of fleet driver safety and fuel efficiency monitors, has raised $15mm in "growth funding", led by DAG Ventures and including return investors Benchmark Capital, Virgin Green Fund, Amadeus Capital Partners and Balderton Capital.
  • OutSmart Power Systems, a developer of commercial building energy efficiency systems, has announced a $2mm seed round from Bainco, Clean Energy Venture Group, and Manifold Products.
  • Micro fuel cell developer UltraCell announced a $3.8mm insider round, from existing funders BASF Venture Capital GmbH, OnPoint Technologies, Espirito Santo Ventures (ES Ventures) and Miami Valley Venture Fund.
  • VentureWire reported on a few fundings that have been discovered through Reg D filings:  Arxx Corp. (green building materials) has raised $3mm of a targeted $4.3mm round; Infinia Corp. (solar) has raised $14.1mm of a targeted $50mm debt/rights financing;Tendril Networks (smart grid) has raised $19mm out of a targeted $30mm equity raise; and Renewable Fuel Products (biofuels) has raised $145k.
  • Wind developer OwnEnergy has added to its Series A with new financing from Clearpoint Ventures and GoGreen Capital.
  • Biogas plant developer agri.capital has raised a EUR60mm round of financingTCW Group, Inc led the round, alongside existing investors Altima Partners, Green Partners, Halcyon and Ludgate Environmental Fund. agri.capital also raised a EUR10mm mezz debt facility with Ecofin.
  • Germany's P21, which is developing fuel cell for backup power systems, has raised a EUR10mm round of financing led by Yellow&Blue Investment Management, alongside existing investors Target Partners and Conduit Ventures.
  • Madrone Capital Partners has led a $22.5mm round of financing into solar micro inverter company Enphase Energy.  New investor Bay Partners also joined the round, which included existing investors Third Point Ventures, RockPort Capital Partners and Applied Ventures.
  • It's not a cleantech deal, but still, I thought this report by Cooley Godward (note: opens PDF) was very much worth highlighting, since it does a great job of illustrating the dramatic downtown in venture capital valuations over the past few months, across all stages.  Entrepreneurs, take heed...

Other news and notes: If you haven't seen it already, it's well worth reading Joel Serface's piece on his year as an EIR at NREL...  Finally, while the WaPo editors are down on the Chevy Volt, this column by Michael just made me jealous!

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