FountainBlue’s May 2 Clean Energy Entrepreneurs’ Forum was on the topic of Renewable Energy Generation: Breakthroughs and Challenges
Below are notes from the conversation.
Our panelists had extensive knowledge and experience in the renewable energy space over the past two decades, and have witnessed in and participated in the emergence of a new industry. They concur that as the industry is maturing, more experienced, knowledgeable and connected people are in leadership positions which can help drive and grow the industry overall.
This network of experienced leaders understand the technology, infrastructure, utility, policy and other challenges inherent in the industry, and are forging alliances and partnerships with the many stakeholders involved in the industry. This is driven in part by increasing oil prices, and the growing public demand for renewable energy options. Below is a list of stakeholders and some of the factors which are driving their behavior around the adoption and growth of renewable energy.
• Policymakers are generally not business people or technologists, and the best ones seek knowledge and education to best support this emerging industry.
• Utilities are invested in adopting renewable energy, to meet the policy standards, however infrastructure challenges make it difficult to include renewable energy options at rates similar to standard oil, coal and gas options and policy mandates do not specify how the standards can be met, and other policies actually make it *more* difficult to meet the mandate.
• The media has reported on our track record over the last decade or two has been mixed at best, due to some overinvestment in technologies providing incremental rather than disruptive, game-changing improvements, and high-profile examples of large-investment companies who had executed poorly and generated poor returns and sometimes failed companies. Thus, public opinion around renewables has been much less enthusiastic.
• Because of the investment track record over the past two decades, investors today are funding shorter term, less capital-intensive, more mature companies rather than early-stage renewable companies.
• Customers are educated enough to want more sustainable energy choices, but not yet passionate enough to select renewable energy options which are measurably more expensive than standard energy options. So the technology and business model challenge is to provide customers options which meet both requirements.
Despite the challenges facing stakeholders listed above, there are also huge opportunities ahead.
• Large companies as varied as technology companies like Google, the large oil and gas companies, large chemical companies like DOW, and other companies are beginning to see opportunities in renewable energies. Some of them are beginning to invest in research, in the interest of generating 3-5x returns, with the potential increasing both their market share and their corporate image.
• Corporations, research institutions, academics, entrepreneurs and others are forging technology innovations in all renewable sectors. In addition, technologies launched even in the 70s and 80s are more attractive today because of increasing oil prices and because of software, networking and other innovations which make the technology option more viable.
• Customers in emerging countries such as China, Brazil and India are becoming increasingly affluent, which is driving the demand for more energy, delivered more cost-effectively. This ready-made market is incentivizing collaboration and innovation amongst the stakeholders, and the market will only grow from here.
There were conversations around policy and international markets throughout the panel discussion. The panelists remarked that China is moving faster in the renewable space as their hyper-adaptive culture and command-and-control leadership lends itself more to embracing the opportunities in the renewables space than the US democratic capitalism which welcomes debate across stakeholders with a wide range of objectives and a lot of money and power at stake. Because of their manufacturing and operational expertise, and their willingness to undercut costs, the Chinese are increasing dominating international markets in manufacturing of solar panel and wind turbines. Because there is less existing infrastructure, it is less challenging to integrate renewable energy options into the grid. And with China’s dominance in manufacturing and distributing solar panel and wind turbine parts, they are also becoming experts at manufacturing similar parts for similar and other purposes, providing them with more market opportunity. There was also a brief discussion about Europe and how Europeans overall are more in alignment in support of renewable energy adoption, and a brief remark that emerging companies have more un-claimed land which may be repurposed for energy generation.
Below is advice offered by the panelists to entrepreneurs in this space:
• Although the focus is on innovative, game-changing technology, it’s always about the people and whether they have the experience, ability, fortitude and attitude to make it happen. So act like you have the train on track, and show measurable results on milestones which make sense.
• Seek proven technology innovations and create and implement a business model which would generate returns while serving the market.
• Design your solution to scale cost-effectively.
• Large companies are investing in R&D and approaching renewables from many directions – from chemicals to oil and gas to software and sensors and algae. Seek a potential corporate partner and alliance which would invest in your technology/idea/research.
• Solve a renewables integration problem, including storage, smart grid, monitoring and sensing, distribution, etc
• Look beyond wind and solar and consider geothermal and biofuels and wave technology, provided they are solutions that can be capital efficient leveraging tested technology.
In the end, remember that the renewables industry is still in its infancy. Work with all stakeholders to grow the industry, and have the patience and fortitude to invest in its success as the market for renewable energy is huge, and will only get bigger.
Thank you to our speakers for their input and comments:
Facilitator Linda Holroyd, CEO, FountainBlue
Panelist Ann C. Chan, Member, Board of Directors, Carpe Diem West, founder and former director, Center for Clean Air Policy (CCAP)
Panelist Annie Hazlehurst, Associate, DFJ
Panelist Jim Hurd, Director, Molecular Business Consultants, VP for Strategic Alliances, GIVE Eco Energy
Panelist Roy Kornbluh, Principal Research Engineer, Engineering R&D Division, SRI International
Presenting Entrepreneur Eric Cherniss, White Hat Renewables
Presenting Entrepreneur Geoff Sharples, Clear Path Energy
Please also join us in thanking our hosts at PARC for graciously hosting us at their facilities and to our sponsors at KPMG for their ongoing support of our program and the series.