Four companies from Washington state have been selected to a list of the world’s 100 most promising private cleantech firms. That’s according to a report released yesterday, in a joint effort by The Guardian (the UK-based newspaper) and the Cleantech Group, a global company that provides research, data, and advisory services for the clean technology industry.

The Washington results are not too shabby—especially for a state that has been perceived as trailing other parts of the country in terms of cleantech venture investment, alternative energy policy, and expertise. We’ve been hearing a lot about those issues from experts like Jesse Berst of Redmond, WA-based Global Smart Energy and Michael Butler of Seattle’s Cascadia Capital. While the latest news won’t do much to stem any criticism (nor should it necessarily), it does provide some recognition for the local cleantech scene.

The Global Cleantech 100 list “recognizes companies at the forefront of cleantech innovation offering solutions to some of the planet’s most pressing environmental challenges,” according to the Cleantech Group’s website. The companies were selected by a process involving hundreds of international experts on cleantech innovation, venture capital, and entrepreneurship (check out the methodology here). Cleantech, by their broad definition, spans the fields of energy generation, storage, infrastructure, and efficiency, as well as transportation, water and wastewater, air and environment, materials, manufacturing, agriculture, and recycling and waste.

The four Washington companies span energy generation (solar and geothermal), energy efficiency, and software. We’ve covered all of these companies this year at Xconomy, and here’s a bit about each one:

—AltaRock Energy, based in Sausalito, CA, and Seattle. This geothermal company was founded in Seattle in 2007, and plans to artificially engineer reservoirs of hot water deep underground and extract steam energy as it rises to the surface, as we reported last summer. AltaRock hit a snag in recent weeks when it had to suspend drilling of a well in Northern California due to geological problems, but says it is continuing to develop its technology and look for alternate drilling sites. The company is backed by Vulcan Capital, Kleiner Perkins Caufield & Byers, Khosla Ventures, Google.org, and others.

—Infinia, based in Kennewick, WA. This solar power company makes devices that capture and focus sunlight, and then harness the concentrated heat (using a Stirling engine) to generate electricity, as Luke reported in a recent company profile. The strategy is complementary to traditional solar cells and photovoltaics. Infinia has been around since the 1960s, but has focused on solar since 2005. It is backed by Vulcan Capital, Khosla Ventures, Idealab, and other prominent investors.

—Powerit Solutions, based in Seattle. This energy-efficiency company, originally from Sweden, has been in Seattle since 2002. It makes hardware and software to reduce energy consumption and costs in industrial facilities like steel mills and manufacturing plants, as Rachel reported this summer. In May, Powerit raised $6 million led by Siemens Venture Capital and ArcelorMittal’s Clean Technology Fund, with @Ventures and Expansion Capital Partners also participating. Some of its customers include Ikea, Benton Foundry, Stockholm Airport, and the San Jose Mercury News.

—Verdiem, based in Seattle. This cleantech software firm, founded in 2001 and backed by Kleiner Perkins and other investors, focuses on energy efficiency and management in the corporate IT world. Its personal computer power-management software has been installed on more than one million desktops, and its customer base has doubled in the past year to include more than 300 corporations, government agencies, and universities. We’ve reported on Verdiem’s progress in demonstrating energy and cost savings to companies, as well as its broader strategy in cleantech-meets-IT from CEO Jeremy Jaech.

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AltaRock Energy, a geothermal startup based in Sausalito, CA, and Seattle, announced earlier this week it has suspended drilling of a deep well in Northern California because of “geologic anomalies.” The well is part of a Department of Energy-funded demonstration project for AltaRock’s engineered geothermal system, which would create reservoirs of hot, subterranean water artificially. AltaRock said it is continuing to develop its technology and evaluating alternative well locations. AltaRock has raised about $30 million in venture funding from Vulcan Capital, Google, Khosla Ventures, Kleiner Perkins Caufield & Byers, and Advanced Technology Ventures. (See more coverage in the New York Times, PE Hub, CNET, TechFlash, and others.)

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Hillsboro, OR-based ClearEdge Power, a developer of fuel cell systems for homes, has raised $15 million in equity funding, according to PE Hub, Northwest Innovation, and others, which cite a regulatory filing. Investors in the current round were not disclosed, but ClearEdge was previously backed by the Kohlberg family, Big Basin Partners, and Applied Ventures.

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Seattle-based Tuusso Energy, a developer of solar power plants, announced today it has completed a $2 million financing round led by Pivotal Investments, based in Portland, OR. The investment was made in partnership with Akula Energy Ventures, which will be co-investing in Tuusso’s utility-scale projects. The company’s first project is a solar plant, slated for completion in 2011, that will supply 20 megawatts to California utilities.

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Seattle-based Bio Architecture Lab, a stealthy spinout from the University of Washington, has raised $3.4 million in equity funding out of a $6 million offering, according to a regulatory filing. Michael Borrus of Menlo Park, CA-based X/Seed Capital is listed on the form as a director, which suggests that X/Seed participated in the funding round. But the form says there are two investors, and the other is unnamed. Reached for comment this morning, Bio Architecture Lab CEO Nikesh Parekh said the company is not talking to the media yet.

Bio Architecture Lab raised $1.5 million from X/Seed last year. (X/Seed is loosely related to Mohr Davidow Ventures.) The company has said it applies computational enzyme design and synthetic biology to produce biofuels and renewable chemicals from novel, sustainable biomass sources—the advantage being that these products cost much less than fuels and chemicals made from traditional sources like corn or sugarcane. The technology was originally spun out of the lab of prominent UW biochemist David Baker, whom Luke profiled here.

The latest funding seems to at least partially validate the efforts of the UW TechTransfer program in connecting venture capitalists with commercially promising technologies from university labs. More specifically, it is a significant step forward for commercial applications of Baker’s research, which has also spawned another Seattle startup working with enzymes, Arzeda.

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[Corrected 7/1/09]

The atmosphere at last Wednesday’s XSITE energy breakout session was electric—clean electric, that is. The topic of the hour was the future and feasibility of wind, solar, and other alternative energy industries in New England. Rob Day, president of the Renewable Energy Business Network, moderated the panel, which included Jay Fiske (a VP at solar firm Wakonda Technologies), Daniel Goldman (EVP and CFO of GreatPoint Energy, a developer of coal gasification technology), Gerry Haines (EVP and chief legal officer at biofuel firm Verenium), and Roger Freeman (president of wind power firm Solventerra Energy).

The energy industry is staring down the barrel of heavy government involvement in its affairs. The Waxman-Markey bill, which at the time of the panel was still being debated in the House of Representatives, poses both potential opportunities and potential headaches for the clean energy industry. The new emissions regulations aimed at the largest polluters, intended to force large energy companies to develop cleaner fuels, may provide a huge boost to smaller cleantech firms. “The problem with Big Oil is, even with incentives given to work on alternative fuels, they’re not really in the tech development business, so we work with them,” said Haines.

Waxman-Markey’s detractors, however, say that the stricter federal standards for controlling carbon emissions leaves less room for companies, especially smaller ones, to adjust to local conditions. The costs that are more easily absorbed by large oil or coal interests may prove more challenging to a small cleantech company.

When asked how startup energy firms could cope with more stringent government regulation, GreatPoint Energy’s Goldman noted that utilities, for the most part, have always been regulated, and that “we have to accept that we work in a regulated industry, and that government policy plays a very significant role.” On the other hand, he said, most companies “can’t afford time to sit in Washington influencing members of Congress.” He advised that smaller cleantech companies not try to lobby for policy changes on their own, but to piggyback onto the efforts of larger companies. “Figure out how your company’s interests align with, say, GE, and leverage off their focus.”

When asked to comment on the difficulties that energy startups face in acquiring venture funding, Solventerra’s Freeman, the former managing director of the nonprofit Citizens Energy Corporation, said that the lack of potential for a big—or bigger than expected—payoff was the problem. “Energy is a tangible business. You put x amount in and get x amount of energy out. You can measure the risk pretty successfully, so it doesn’t attract as much venture investment.”

“It’s not Web 2.0,” said Day.  “You have to actually make something.”

Fiske noted that in the current economic climate, investors might be cautious, but alternative sources of funding for cleantech have never been more abundant.  Cleantech can always look to “SBIR grants, competition winnings, and of course, the three Fs—friends, family, and fools.” [Editor's note: this quote was originally misattributed to Daniel Goldman. We regret the error.]

Day asked the panel to describe some of the barriers in New England to the success of cleantech. Freeman said that Boston’s deeply engrained parochialism means navigating a maze of regulation for even the simplest matters. Major additions and infrastructure changes can only be that much more of a headache. “It took my friend two years to get a permit to build a deck. How long do you think it takes to get one for a wind turbine?”

“The good thing is, we have a forward-thinking administration here in Massachusetts,” said Goldman. The Patrick administration, he says, is a staunch supporter of cleantech innovation.

Wakonda’s Fiske said that Massachusetts could be doing more to capitalize on its intellectual resources, and that universities in particular could better support spin–offs and the commercialization of their research. The panelists all concurred that the concentration of both high-level research institutions and scientists was New England’s greatest advantage.

“Intellectual capital,” said Haines, “is our best resource.”

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SpectraWatt, a Hillsboro, OR-based maker of photovoltaic cells, received a $500,000 contract from the National Renewable Energy Laboratory yesterday.  Part of the American Recovery and Reinvestment Act, the contract is for the company to develop ways of improving solar cells without changing current manufacturing processes.  SpectraWatt was one of 13 companies to receive money from NREL, the ultimate goal being to speed up the commercialization of solar energy technologies.

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Noble Environmental Power, an Essex, CT-based wind energy company, has withdrawn its planned for an IPO. The offering, initially filed in May 2008, was to include some 23.4 million shares worth up to $375 million. In its filing today, Noble said withdrawing the offering “is consistent with the public interest and protection of investors.” The company operates six wind farms in New York state, one in Texas, and has 8 more under development in New York, Minnesota, New Hampshire, and Vermont.

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Soon, you really won’t need a weatherman to know which way the wind is blowing in Massachusetts (or one part of the state, anyway)—all you’ll have to do is look for the spinning turbines in Nantucket Sound. Last week, the state’s Energy Facilities Siting Board voted unanimously to grant Cape Wind Associates all necessary state and local permits to begin construction on a wind farm to be located on Cape Cod’s Horseshoe Shoal, a little more than five miles from Hyannis. Yesterday, the state’s Undersecretary for Energy, Ann Berwick, signed off on the certificate. The project can begin construction once it receives approval from the U.S. Minerals Management Service. Governor Deval Patrick issued a statement of support for the venture: “The time has come to see the first offshore wind farm in America rise off the Massachusetts coast, a powerful symbol of our commitment to a clean energy future.”

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Kennewick, WA-based Infinia, a maker of solar power generation technology which uses free-piston Stirling engines, has raised $14.1 million in debt financing, according to a regulatory filing. The financing looks to be part of a $50 million offering. Infinia is backed by Vulcan Capital, Khosla Ventures, and others.

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Sick of cleantech yet? Rick LeFaivre certainly isn’t. In fact, he’s just getting started.

The managing director at Kirkland, WA-based OVP Venture Partners leads the VC firm’s investments in alternative energy and cleantech, together with fellow managing director Gerry Langeler, who is based in Portland, OR. To date, OVP has made five investments in cleantech—Carbonflow, Verdezyne, Tigo Energy, M2E Power, and Seattle-based EnerG2. It is also in the process of closing an investment deal with Arzeda, a University of Washington spinout that designs enzymes that could (among other things) make cellulosic biofuels feasible.

LeFaivre joined OVP in 2004 and originally comes from the world of computing. He was previously a vice president at Apple, and held other senior management positions at firms like Borland, Silicon Graphics, and Sun. Before that, he was a professor of computer science at Rutgers University. LeFaivre sees parallels between some aspects of today’s alternative energy technologies and information technologies, including the rise of the Internet (more on that in a minute).

As he sees it, the cleantech sector breaks down into three main tech categories: energy generation, storage, and management. Generation encompasses all the different ways to produce energy—wind, solar, nuclear, geothermal, and so forth. The storage aspect is what he calls the “time shift”—ways to save the energy you produce for later, when you need it. And the management side has to do with energy transmission and control— including the idea of a “smart grid” that directs energy flow to consumers in a more efficient and reliable manner than our conventional electric grid.

From a venture perspective, LeFaivre says now is the time to make new investments in cleantech, despite the financing risk. “Our attitude is, every VC has slowed down,” LeFaivre says. “It’s a pretty good time to invest. Prices are down, that helps us. The deals we invest in now—we’re in normal venture times—they’ll take five to seven years for an exit. The ones we worry about are the ones we invested in five to seven years ago, and the exit climate is lousy.”

In terms of what he looks for in new deals, LeFaivre says, “I don’t think of a cleantech deal as different from anything else. There’s a core concept that’s protectable and leverageable. It’s picking the right companies with venture economics.” By that, he means companies that are in the …Next Page »

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Seattle wind energy startup Principle Power is in the process of raising $20 million to develop wind farms in the deep waters off the coast of Oregon and other locations. The financing deal is expected to close in the second quarter of this year, according to Principle Power CEO Alla Weinstein.

“We’re talking to a number of strategic investors,” says Weinstein, who adds that none of them are in the Seattle area, and none are venture capital firms. Last April, Principle Power raised $2.3 million from angel investors, most from the San Francisco area (many of them affiliated with the Keiretsu Forum angel network), and some in Europe. The company signed an agreement with Tillamook People’s Utility District in November to develop a 150-megawatt wind-power plant off the coast of Tillamook County, Oregon. And two weeks ago, Principle Power announced a deal with EDP, Portugal’s largest energy utility, to build a wind farm off the Portuguese coast.

Offshore wind turbines are not new, but all existing systems rest on the ocean floor in relatively shallow water. As Weinstein explains, there are two main reasons for putting wind farms offshore in the first place: to decrease their visual impact on residents and tourists, and to gain access to stronger and more consistent winds. The problem is that along many shorelines, like the West Coast of the U.S., the ocean gets deep fast. Go out just a few miles, and the water is already more than 40 meters deep—which causes major technical problems with conventional turbine installation and maintenance.

That’s where Principle Power’s technology comes to the fore. The company’s patent-pending foundation, WindFloat, is designed to support a 400-ton wind turbine and keep all of its associated machinery afloat (and properly aligned) in raging ocean swells—hardly an easy task. The platform is triangle-shaped, with the turbine sitting atop one corner; all three corners have submerged legs, or columns, that help stabilize the platform, Weinstein says. The columns, which are connected by trusses, are moored to the ocean floor and contain “water-entrapment plates” that keep the platform very stable at low cost, allowing the company to use off-the-shelf offshore wind turbine generators. The foundation is assembled on a wharf and then towed out to sea, which makes its installation manageable.

Until now, Denmark and the UK have led the world in offshore wind—so how did the Pacific Northwest get on the map? Weinstein, a Russian native and Honeywell veteran, previously founded AquaEnergy Group in Seattle, an ocean wave-energy company that was acquired in 2006 by …Next Page »

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SolarWorld Industries, whose parent company is based in Bonn, Germany, is cutting 63 positions from its Vancouver, WA facility, according to the Washington State Employment Security Department. SolarWorld says the move is not a reduction in total staff, but rather a transfer of operations to its new manufacturing plant in Hillsboro, OR (which Xconomy reported on here).

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I pinged energy expert Jesse Berst, the managing director of Redmond, WA-based GlobalSmartEnergy, to get his take on EnerG2, the venture-backed energy-storage startup we profiled earlier today. EnerG2 has developed a nanotech approach to building better batteries and “ultracapacitors” for storing electricity. Berst, an Xconomist, replied with some insights into the startup’s prospects for becoming a major player in the electricity economy (you can read more about this here and here), and the main challenge it faces.

Berst first emphasized the importance of EnerG2’s core market. “Energy storage is the choke point of the electricity economy,” he writes. “Whether you want electric vehicles, a smarter, more reliable grid, or simply a laptop that lasts all day on a single charge, it is the lack of cost-efficient storage that stands in your way.”

He then gave a bit of context to the problem EnerG2 is solving. “Although we’re making progress, it is largely incremental—squeezing out more efficiency from approaches that have been known for decades. If EnerG2 has found a new way to store energy, and a way that can achieve industrial scale, the world will beat a path to its door.”

“That said, it should be prepared for skepticism,” Berst writes. “Every few years a new startup appears claiming radical improvements in storage. So far none of them have been able to move to real-world applications in quantity.”

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There’s a small company in downtown Seattle called 3Tier Group that has a goal of no less than “Remapping the World” for alternative energy. T. Boone Pickens, the billionaire Texas oilman, is such a big fan, he used 3Tier’s maps to draw a bold conclusion-that the United States has the potential to be “the Saudi Arabia of Wind.”

3Tier might sound a little New-Agey in its goals, maybe a little pie-in-the-sky in a world where Exxon Mobil has enough money in the bank ($36.7 billion on Sept. 30) to bury all U.S. cleantech startups. So I decided to check it out personally, meeting with Kenneth Westrick, the founder and CEO, at his 21st floor offices in the Westin Building in downtown Seattle. Westrick, an atmospheric scientist with a master’s from the University of Washington, greeted me with a boisterous handshake. He was wearing a long brown leather jacket like the one worn by Jimmy McNulty, the protagonist of HBO’s “The Wire.” (One of my all-time favorite shows.)

When we sat down in a conference room looking out over South Lake Union, I asked what he really meant with his “Remapping the World” initiative. It’s about using high-powered computers to crunch data that helps developers, financiers, and governments decide where the best places are to put a wind farm, solar panels, or hydropower turbines. This isn’t nearly as easy as it sounds, because wind ebbs and flows at different times of day, different seasons of the year. Some years are El Nino, some La Nina. Measurement instruments at Sea-Tac airport don’t always capture wind speed at the corner of 1st Avenue and Pike Street. Same goes for solar, and hydro.

That’s a lot of variables to account for, especially if you’re General Electric and looking to invest $300 million in a wind farm that’s supposed to pay off over two or three decades. So 3Tier inhales huge amounts of climate data into its computers, and analyzes it in models to come up with an accurate forecast of what kind of power a particular wind farm is going to produce over time. It can also take measurements at a site over a year’s time, and crunch numbers that may spot a better site a few miles away from one the developer originally scoped out, Westrick says.

“The greatest risk is in the availability of fuel,” Westrick says. “We can create a map of where the wind blows. We can ask where is it abundant? Will it be abundant when we need it?” He added later, “Only a couple of companies can do this.”

Westrick started this company in 1999 in his bedroom. It has grown to about 70 employees. About one-third were trained in earth sciences, one-third are software programmers, and the rest in are in administration, support and business development, he says. 3Tier doesn’t disclose its financials as a private company, but he says the company has boosted sales growth by more than …Next Page »

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Brookfield Renewable Power, a Canadian energy company, is planning to open a new US headquarters in Marlborough, MA. The firm has a $13 billion portfolio in hydroelectric plants and wind farms across North America and Brazil. It is owned by Brookfield Asset Management (NYSE: BAM), based in Toronto.

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It’s not just pollen in the air these days. Renewable energy projects are blooming throughout New England. Now, Noble Environmental Power, a fast-growing wind-power company based in Essex, CT, has filed for an initial public offering worth up to $375 million. (On the heels of yesterday’s IPO filing by Lexington, MA-based web management services firm Gomez, maybe the market for IPOs really is coming back).

According to its filing with the SEC, Noble Power is “focused on developing, financing, constructing, owning and operating windparks in attractive energy markets in the United States.” The company’s plan is to sell energy and energy-capacity generated by its wind parks. Its first three parks have been up and running in New York since March, and the firm hopes to quadruple its total power capacity by the end of 2009, with more parks under construction in New York and Texas. By 2012, it may expand to Maine, New Hampshire, Vermont, and other states.

To date, the company has not yet generated significant revenue—it reported $72 million in net losses as of the end of 2007. It is also dependent on state policies and regulations that support wind parks—not always the easiest projects to push through.

Founded in 2004, Noble Power has more than 150 employees and a total capitalization of $1.1 billion. JPMorgan Partners, Lehman Brothers, and Credit Suisse are leading the underwriting. The principal shareholder is JPMorgan. When the time comes, Noble Power intends to trade on the NASDAQ market under the ticker symbol NEPI.

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