Nothing ventured

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Of the various sources of available money, venture capital (VC) has traditionally shown little interest in the wind industry. Unlike the blazing sunspots of huge profits in the solar business, wind power is more about slow and steady returns rather than about windfalls. That pattern is not showing much sign of changing, even with venture capital once again sniffing at the heels of green energy.

"Venture capital investment depends on the cycle of innovation and clean technology appears to be entering a new cycle of investment where VC [players] are ready to invest," says Philippe Raybaud of French law firm CGR Legal, speaking at the recent European Wind Energy Conference (main story). But he does not expect the benefits of an upturn for early stage or technologically oriented clean energy investments to trickle down significantly to wind.

"The wind industry is generally considered as requiring less technological innovation," says Raybaud. To help overcome that perception, he suggests the industry should point out where innovations need to be made. "It's not so easy if you're not in the wind business to know that there are problems with noise and birds." Companies able to put forward lasting solutions to barriers that have resulted in numerous wind farm projects being blocked should be seen as attractive investment opportunities.

In the past, some wind companies have managed to attract VC funding, though the underlying technology attracting investors was sometimes suspect. Vortec Energy was a particularly notorious example prior to its collapse (Windpower Monthly, August 2001).

More recently, Truffle Capital last year put EUR 1.5 million into 2-B Energy, a Dutch start-up working on a new wind turbine design with lower capital and operating costs for offshore use. Good Energies, a unit of the Switzerland-based Cofra Group that invests in renewable energy, has also made several venture capital investments in wind. Among these, it has invested in American Second Wind, a Massachusetts-based provider of electronics and software for wind resource assessment data.

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