Cleantech Funding on the Rise, Leads Tech Sectors

By September 30, 2009

Cleantech investments continue to rebound, rising 10 percent in Q3 2009 over the previous quarter. While the continued recovery is a good sign, cleantech investments are still down 42 percent year-over-year, according to the CleanTech group and Deloitte. “Clean tech continues its recovery despite the lowest level of venture capital investment overall since 1997,” Dallas Kachan, Cleantech Group’s managing director said in the LA Times. Globally, cleantech is now the number one recipient of VC funding.

“Cleantech has gone from a niche category to 27% of all venture investment. It eclipses the amount being currently invested in biotech and software,” Kachan said.

Q3 cleantech funding in North America, Europe, China and India totaled $1.59 billion, primarily due to government stimulus measures.

“The billions in government funding being allocated globally in clean technology have begun emboldening private capital, which has in turn helped propel clean technology to the leading venture investment sector, now eclipsing biotech and IT,” Kachan said in a press release.

The largest deals – which went to Solyndra and Tesla Motors -- were due to US government funding.

Solar was the leading cleantech sector, representing 28 percent of cleantech investments by receiving $451 million in Q3, which is still a far cry from the $1.2 billion invested in this sector in Q3 2008.

Transportation, buoyed by Tesla’s raising of $82.5 million in funding, received $383 million in funding overall. Green-building technology received $110 million in Q3 funding.

North American companies were the leading recipients of cleantech venture capital, accounting for 67 percent of global funding. Europe and Israel accounted for 29 percent of total Q3 2009 funding, China raised 3 percent of global capital, and India accounted for about 1.5 percent.

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