Solar Energy Nanotechnology Can Replace Fossil Fuels - SF Chronicle
Monday, July 11, 2005
Investors along Sand Hill Road in Menlo Park are pouring money into solar nanotech startups, hoping that thinking small will translate into big profits.
Both inventors and investors are betting that flexible sheets of tiny solar cells used to harness the sun's strength will ultimately provide a cheaper, more efficient source of energy than the current smorgasbord of alternative and fossil fuels.
Nanosys and Nanosolar in Palo Alto -- along with Konarka in Lowell, Mass. -- say their research will result in thin rolls of highly efficient light-collecting plastics spread across rooftops or built into building materials.
These rolls, the companies say, will be able to provide energy for prices as low as the electricity currently provided by utilities, which averages $1 per watt.
Other uses of nanotechnology foreseen by Konarka, Nanosolar and Nanosys include form-fitting plastic batteries for electronic devices like cell phones and laptops.
While all three companies provide prototypes for large corporate research labs and government agencies, company representatives and investors are reticent to predict when nanotechnology-powered solar systems will be commercially available. Industry watchers, however, say that achieving mass production of these products may take five years or longer.
"We take the long view, although we're not averse to having products very quickly," said Bryan Roberts, general partner at Venrock Associates in Menlo Park, a leading Nanosys investor. "Whenever you're developing a novel technology platform, you're looking at a four- to six-year time frame rather than a three- to four-year time frame."
Recent investments include $7 million in debt financing for Konarka in June, making its total funding to date $38.5 million. Nanosolar recently announced more financial support in a Series B round of funding that secured $20 million in May. With previous investments of $7.25 million, it has secured a total of $27.25 million.
Both Konarka and Nanosolar have said they plan to use the money for new research and development facilities.
Nanosys, which cited poor market conditions as the reason for withdrawing its IPO in August, has raised $55 million to date. The company's last round of funding in April 2003 secured $30 million.
Venture capitalist excitement for these new technologies reflects growth in the solar energy market as whole, say industry experts.
"The technology is maturing, and the industry is maturing. British Petroleum, Shell and the oil companies are all in this field," said David Wooley, vice president of the nonprofit Energy Foundation in San Francisco, a research group funded by major charitable trusts but not affiliated with utilities or energy producers.
Costs must be reduced
Solar energy ranges between $4 and $5 per watt. The report suggests market expansion will require $2 to $2.50. If the price breakthrough occurs, says Wooley, the report's assumed price structure represents a $6.6 billion annual market opportunity.
The Energy Foundation report also says that solar energy could furnish much of the nation's electricity if available residential and commercial rooftops were fully utilized. According to the Energy Foundation, using available rooftop space could provide 710,000 megawatts across the United States, whose current electrical capacity is 950,000 megawatts.
"The market is obviously huge, demand is huge. Besides, (alternative energy) is imperative in the world we live in," said Bill Gurley, a general partner at Benchmark Capital in Menlo Park, an early investor in Nanosolar.
As for recent growth in solar energy, Paula Mints, a senior analyst at the technology research firm of Strategies Unlimited in Mountain View, says that 14,000 photovoltaic megawatts were sold last year, representing 54 percent growth in the industry.
Interest from VC investors
"It's very healthy for the industry. They (venture capitalists) see the growth and the possibilities," she said.
However, Mints also cautions against expecting immediate changes in the way energy is produced. She cites the long development history of conventional solar cells.
"It took 20 to 25 years to commercialize (conventional) photovoltaics," she said.
High production costs are among the reasons solar energy hasn't become a major source of electricity.
The black, glasslike photovoltaic cells that make up most solar panels are usually composed of crystalline silicon, which requires clean-room manufacturing facilities free of dust and airborne microbes.
Silicon is also in short supply and increasingly expensive to produce, so high manufacturing costs are the main reason behind high wattage prices.
Long payback time
With nanotechnology, tiny solar cells can be printed onto flexible, very thin light-retaining materials, bypassing the cost of silicon production.
"Silicon is very capital-intensive. You don't need a clean room for plastic power where capital costs are one-tenth of silicon," said Raj Atluru, managing director at the venture capitalist firm of Draper Fisher Jurvetson in Menlo Park, a major investor in Konarka.
Konarka, Nanosys and Nanosolar say their solar technology will reduce the time it will take consumers to recover production and installation costs to a matter of months.
In addition to being able to manufacture photovoltaic cells more quickly through printing, the companies also say that manipulating materials 100,000 times smaller than the width of a human hair will provide more light- collecting capabilities.
Each printed nanostructure solar cell would act as an autonomous solar collector, and sheets of these products would have more surface area to gather light than conventional photovoltaic cells.
The companies also say that the printed rolls of solar cells would be lighter, more resilient and flexible than silicon photovoltaics.
If the technical hurdles can be cleared, the biggest money will be found atop buildings.
According to Matthew Nordan, vice president of research at New York's Lux Research, "The ultimate prize is rooftop distribution applications," in which residential and commercial buildings would generate most of their own power.
The companies envision mass production of flexible plastics that would conform to the shape and pitch of rooftops or would be imprinted onto building materials like tile and siding.
"Flexibility allows you to develop new form factors. Why not integrate solar cells into, say, a Spanish tile?" said Nanosys spokesman Stephen Empedocles.
It remains unclear, however, who would install nanotechnology-based solar components if they become commercially available.
"There's no channel to the market," said Nordan, who sees a fragmented solar installation market made up of numerous contractors, which makes adoption of any technology difficult.
Nordan also sees obstacles in transmitting solar energy from rooftop collection sites back to electrical grids and other buildings not wired with photovoltaics.
Distribution an obstacle
Until the distribution issue is solved, Nordan says, solar energy will not be able to meet its potential of supplying vast amounts of power.
Analysts like Nordan and Mints say that while rooftops are the most attractive areas for investors, nanomaterial solar energy may first be implemented on mobile devices like cell phones and laptop computers.
Contracts from the military
"Price is no object for the military, and they need power on the go," said Nordan. "Besides, the mobile-phone industry is driven by new features."
All three companies rely upon government contracts in addition to private funding. The Defense Advanced Research Projects Agency has been the most generous. Konarka has a $6 million grant, and Nanosolar has received $10.3 million.
Nanosys' $9.4 million in grants comes from that agency, as well as the Department of Energy and the Navy, among others -- although not all of this research is solar-related.
Industry watchers like Wooley of the Energy Foundation say that some kind of government assistance is necessary to make alternative sources of energy viable.
"The (solar) industry has grown and expanded through incentives. The technology doesn't need government support forever, but it's at a crucial point," he said.
Investors, however, are quick to distinguish between grants and regulations mandating alternative forms of energy.
"The bet was not made with the regulation market," said Gurley of Benchmark Capital.
Problems with government
So which way will solar energy go? Atluru said that just as there are different ways to get electricity, the same may hold true for solar energy.
"There's opportunities in traditional silicon photovoltaics, and that's really interesting, and there are companies like Konarka. There's room in the market for all these companies. It's still early days for these startups," he said.
Wooley of the Energy Foundation cautiously agrees.
"What we see is similar to the trajectory for wind energy, where it went from a small-scale industry to a large-scale industry.
"We think the solar industry could see the same growth this decade the wind industry saw in the '90s," he said.
Shrinking solar, expanding profit
Current cost of solar energy, per watt: $4-$5
Estimated cost of energy from nanotech solar panels, per watt: $2
Total energy-generating capacity of the United States: 950,000 megawatts
Potential total rooftop solar energy capacity in the United States: 710, 000 megawatts
August 18, 2005
The Detroit News recently ran a short article on the winner of an annual 2,500 mile solar-powered car race, yet conveniently failed to mention that using the power of the sun alone, the car averaged 46.2 mpg! CNN reported on a eco-car that needs just two gallons to travel 25,000 miles! Why aren't these astonishing facts making top news headlines? We recently posted an email which provided an abundance of reliable evidence that the perceived energy crisis is largely a fabrication of those who stand to reap grand rewards from the escalating price of oil.
If you take the time to explore our New Energy Information Center, you will very likely conclude that we have long had the technology needed to make oil and gasoline obsolete, but powerful political and economic forces have done everything possible to prevent these technologies from moving forward. Please help to spread the word that we now have the technology to transform energy production around the world. Join in calling on our politicians to adequately fund the advancement of these wonderful new technologies. Together, we can and will build a brighter future for us all.
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