[The Vector] Venture Capital Funding for CleanTech Up in 2010

$3.7 billion was invested into renewable energy and cleantech companies in 2010, says Thomson Reuters data for National Venture Capital Association & PricewaterhouseCoopers.

The good news is that venture capital investments rose 76% from 2009, which was a dark year of uncertainty and economic difficulties in general. However, the investments are still less than the peak of 2008, when $4 billion was raised for renewable energy and green tech.

Five of the largest ten venture capital investments went to cleantech companies:

$350 million was raised by Better Place, an electric car provider
$150 million was raised by BrightSource Energy, a CSP plant developer
$111 million was raised by Abound Solar, the Colorado-based maker of thin-film      PV modules
$100 million was raised by Elevance Renewable Sciences, a Chicago firm
$ 78 million was raised by Fisker Automotive, an electric car maker

A recent report indicates a subtle shift for venture capitalists. They are leaning towards energy efficiency companies or products, which are essentially commercial-ready, instead of research technologies or startups like solar which take much longer to be commercially viable.

Courtesy Pew Charitable Trusts

Venture capitalists were also more involved in mergers & acquisitions (M&A) of green companies, acquiring well-run companies that provide, for example, energy distribution, storage or efficiency. M&A activity in cleantech was up 99% to $4.2 billion in 2010, according to the International Business Times (13 January 2011.) A large piece of this was the $1 billion acquisition of smartgrid software maker Ventyx by the Swiss engineering group ABB. Smart grid leadership is on the minds of many energy experts and analysts, and a shift by investors towards is now evident.