As if to validate the editorial in today’s Wall Street Journal that high energy prices promote alternative energy more than government programs, there is an article about venture capitalists funding more alternative energy technologies, including several ethanol based ideas.
The VC money is chasing technologies aimed at increasing the supply of renewable energy, as well as for making existing energy plants and other infrastructure cleaner and more efficient. Venture capitalists sank nearly $181 million into alternative-energy companies last year — nearly double the $103 million invested in that sector in 2004, according to estimates by PricewaterhouseCoopers, Thomson Venture Economics and the National Venture Capital Association. In 1995, investment in the sector was a scant $2.95 million.
Some high-profile investments in the past two years include Amp Resources, a Draper, Utah, power-generation company with geothermal expertise that is being acquired by Raser Technologies Inc., of Provo, Utah, and solar-power companies Nanosolar Inc. of Palo Alto, Calif., and Energy Innovations Inc. of Pasadena.
The price of traditional fossil-fuel energy is soaring as supplies world-wide have become shaky. As a result, alternative energies that used to be prohibitively expensive are getting new attention from policy makers. For example, more than 20 states have mandated that their energy supplies come from renewable sources. In California, Gov. Arnold Schwarzenegger has set a goal of getting as much as a third of the state’s energy in this way.