Clean Tech Investment Plummets 33% in 2009

by | Jan 7, 2010

CleantechVCVenture capital investments in green technology companies declined by 33 percent from $8.5 billion in 2008 to $5.6 billion in 2009, despite a flurry of government subsidies for renewable energy, according to a preliminary report by the Cleantech Group and Deloitte, reports the New York Times’ Green Inc. blog.

However, the overall amount of venture capital was much worse, retreating to 2003 levels, according to the report, compared to clean technology investments that were on track to match 2007 levels, reports the Green Inc. blog.

Wind energy, which was the sector most heavily invested in by U.S. utilities in 2008, continued to be a significant investment sector for utilities in 2009, followed by investments in solar thermal and PV, according to the report. In addition to utilities, the report finds that among Fortune Global 500 companies, energy and consumer and industrial products companies made significant investments in the cleantech sector

The biggest investment sector was solar, which accounted for 21 percent of total clean technology investments, followed by transportation at 20 percent and energy efficiency at 18 percent, according to the report. However, solar investment in 2009 was down 64 percent from 2008, while investment in transportation and energy efficiency reached record levels in 2009, according to Cleantech.

The report also indicates that deals in the clean tech sector declined slightly to 557 in 2009, compared to 567 deals in 2008.

The survey also finds that there were an estimated 505 clean technology mergers and acquisition transactions last year, totaling $31.8 billion, reports Reuters, compared to 394 transactions in 2008, but at a higher transaction value of $32.7 billion.

The survey also ranked the top six most active green venture investors in 2009, ranking Kleiner Perkins Caufield & Byers, SAIL Venture Partners and RockPort Capital Partners, as the top three leaders, reports Reuters.

The report also finds that North America’s share of worldwide venture capital funding fell to 62 percent in 2009 from 72 percent in 2008, reports the Green Inc. blog. China’s share of venture investing in clean technologies remained stable at $331 million, while North American venture funding fell by 42 percent to $3.5 billion, reports the Green Inc. blog.

The three leading states for investments are California ($2.1 billion invested in 116 deals), followed by Massachusetts ($356 million invested in 27 deals), and Texas ($170 million invested in 19 deals), according to the report.

A recent report from Guardian and Cleantech Group shows that the U.S. accounts for 55 companies in Global Cleantech 100 Ranking.

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