6 ms·

Why the Clean Tech Boom Went Bust

31 points by moocow01 15y ago

OstiaAntica 15y ago
"Clean Tech" is a big scam...politically connected VC like Doerr ripping off U.S. taxpayers to fund crony capitalist boondoggles like Solyndra and Fisker. The VC get all the upside, and taxpayers have all the downside. If the elites really cared about solving climate change, they would advance honest, technology-neutral policy solutions like a simple tax on carbon production. Instead, from battery cars to ethanol, Green Tech has been an excuse for a multi-billion dollar money grab.
- startupfounder 15y ago
  WRONG! Clean Tech and Green Tech are not scams, they are investments in our future. Just like any other technology the US has invested in. Like any investment some are good and some go south. If you want to complain about our government "wasting" money and trillion dollar money grabs look no further then the Department of Defense: http://www.nytimes.com/imagepages/2011/03/13/opinion/13opchartimg.html?pagewanted=all http://www.nytimes.com/imagepages/2011/03/13/opinion/13opcha... (note the numbers in this graph are in billions, not millions) Solyndra was a rounding error in what the US Government wastes on defense. VCs are like the government, they only win when companies win. Just like the government VCs loose many, but win big on a few. Government wins when the companies they "invest" in create American jobs. I am not even going to go into you putting "simple" and "tax" next to each other in the same sentence.
  - OstiaAntica 15y ago
    Nearly every single American green energy program, from the 1970s to today, has failed, or is in the process of failing. Some, like massive ethanol tax subsidies and mandates, have significantly damaged the environment. Battery cars are a passing fad that are also bad for the environment-- they rely on coal-fired plants for electricity, and much of that power is wasted in transmission. And the batteries are hazardous. The fact that DoD is a bigger waste of money is not a defense of Clean Tech. The real solution is getting the big incentives correct-- tax pollution, and get the government out of the business of picking technology and playing venture capitalist.
    - mkramlich 15y ago
      > Nearly every single American green energy program, from the 1970s to today, has failed, or is in the process of failing. Solar is booming and doing much better than in the 1970's, and there have been many breakthroughs combined to helping getting the cost per watt way down. > And the batteries are hazardous. You do know gas and oil are hazardous and toxic right? You do know that the extraction, processing and consumption of oil and it's byproducts are putting very large amounts of bad stuff into the air we breathe and water we drink, right? You did hear about the various huge oil spills, including the BP Gulf disaster, Nigeria, etc? The whole point of government, one of many, is is to act as a neutral guardian for society's shared resources and common benefits. Individuals and businesses are relatively free to pursue their own interests, but only so far as it does not harm others (ideally), or bring about Tragedy of the Commons kinds of situations. Thus, some regulation, and some punishment/reward mechanisms are in place to help maintain or bring about the kind of world we want to live in. This should be pretty clear, and has no malevolent intent. I do find it funny that some folks never complained that Big Oil was getting subsidies, incentives, breaks, special treatment, etc. but when it comes to solar, wind, anything intended to be a cleaner or renewable energy source, suddenly there are complaints that government is distorting the market place or picking winners. The difference, clearly, is which technology or industry one would personally rather see favored. Put me down for favoring energy sources that are renewable or better for health. This should not be some kind of radical position, because the benefits are pretty clear. We agree that taxing pollution is probably a good thing for government to be doing. But the oil/coal industries world-wide are fighting such things, and they spend lots of money on Congress. And the Republican Party, in particular, does their bidding almost every time a relevant bill comes along.
      - Turing_Machine 15y ago
        Look into the environmental impact of producing solar cells. Semiconductor fab chemicals are nasty stuff, and when you think about how many square miles would be needed for solar to make any significant impact...
  - quanticle 15y ago
    So why should the US government invest in clean tech over, say conservation? Moreover, why should the US government be making commercial investment decisions at all? The way I see it, the US government should be investing in basic research, then turning that research over to industry for rapid commercialization. Solyndra was not basic research.
- joshmaker 15y ago
  The problem with that idea is that in the current political climate any new carbon tax is a dead on arrival. Realistically, the only options that are politically feasible are to either do nothing or else subsidize green tech industries that seem promising.
- ScottBurson 15y ago
  My understanding (can't find a reference, sorry) was that there was around $1B of private money in Solyndra before the U.S. government added a little over $500M. So while the taxpayers definitely lost, the VCs lost more. But I agree with you about the carbon tax.
Turing_Machine 15y ago
We've had clean, green, safe, carbon-neutral energy for nearly 60 years. Too bad people have been misled into being afraid of it. It's called nuclear power.
- boucher 15y ago
  You only need to look at the most recent problems in Japan to see that nuclear power is never quite as simple as its proponents suggest. All things considered, it's probably still a much better bet than fossil fuels, and probably still a worse bet than renewables like solar and wind.
  - protomyth 15y ago
    Has there ever been a study on large scale wind farms and their affect on weather? I cannot help but think that taking that much energy out of the system might change some things.
    - polymer 15y ago
      On a global scale, wind energy harvesting has a miniscule effect: "should wind supply the world's energy needs it estimates energy loss in the lowest 1 km of the atmosphere to be ~0.007%, which would be an order of magnitude smaller than atmospheric energy loss from aerosol pollution and urbanization"[0]. Of course, the local effect of a large wind plant is different, but given the numbers above I would think it's still negligible. [0] http://www.wse.ie/articles/how-much-wind-energy/index.php http://www.wse.ie/articles/how-much-wind-energy/index.php
      - protomyth 15y ago
        I'm just a little worried about the tendency to put these things in the same states that raise most of the crops and what might be the weather change. Local changes could be problematic.
  - Turing_Machine 15y ago
Caerus 15y ago
I've been a huge proponent of "green" energy for years, and after watching it for those years, it's becoming more and more obvious the technology just isn't there yet. The best we can do is pump more money into research and ignore these poorly planned start ups that are only profitable due to subsidies. Every major type of renewable energy has some aspect which makes it at least a decade and several breakthroughs away from viability. Cellulosic/Algae Ethanol: About an order of magnitude off on cost, many orders away on capacity. They are still immature technologies but seem to have a lot of promise. Photovoltaic Solar: Cost is almost there, but no one has a plan for what to do when the sun isn't shining. Solar systems can only produce energy for about 6 hours a day, which presents a problem when we need energy for 24 hours. It doesn't produce energy during peak demand (~5-9pm) to even help with load balancing. People can currently make a small profit selling back to the grid, but there's virtually no chance of it providing more than about 5% of demand. Solar Thermal Collectors: Better than photovoltaic as they can generally produce power for about 8 hours, then molten salt batteries can provide energy for another couple; but still not a viable large scale solution. Wind: Geographically limited, very high maintenance costs. Hydrogen: Only an energy storage medium, not a means to produce energy. In most cases there are more efficient ways to use the energy directly without the additional loss of producing hydrogen. Corn Ethanol: Energy storage medium, and a bad one. The most optimistic numbers I've found indicate it requires about .84 gallons of gasoline to produce 1 gallon of ethanol. Most numbers are significantly worse, in the 1.2-1.4 range. It sounds great if the lower numbers are accurate, but 1 gallon of ethanol contains ~2/3 the energy of 1 gallon of gasoline so it's still a net loss. (note: I haven't done any serious research on sugarcane ethanol, which at first glance appears somewhat better) Hydroelectic: Great technology that is proven, cost effective, and viable; but is severely limited geographically and the dams can cause major environmental concerns. After years of following the news, studying it, and taking classes in renewable energy; it always comes back to nuclear. If it wasn't for legislative bungling, lawsuits preventing new plants, and the occasional (comparatively) minor failure of 40 year old technology we wouldn't even be talking about a clean energy problem. I'd love for one of these technologies to prove me wrong but there is little indication they will in the near future.
- comicjk 15y ago
  Re solar PV, the problem of the sun not shining is just a bigger-scale variant of load balancing, which has been addressed successfully before. The English grid does it with pumped hydro storage in this mountain in Wales: http://en.wikipedia.org/wiki/Dinorwig_Power_Station http://en.wikipedia.org/wiki/Dinorwig_Power_Station
AngryParsley 15y ago
Peter Thiel had a good analogy in his talk at Singularity Summit: http://www.youtube.com/watch?v=ROrUea0gLlY#t=34m0s http://www.youtube.com/watch?v=ROrUea0gLlY#t=34m0s As with technology, you have to be able to do more with less. Alternative energy has to be cheaper. And until it is cheaper, it's going to be very hard to get it to work. If you had Amazon as a computer company- if you had said in '96, "Yeah it's gonna cost twice as much to buy a book and it'll take you 6 months to get it, but we're going to get subsidies that are really big and that will make the business work and that's why you should invest." That would be quite difficult to work. Cleaner energy sources will take off eventually, but not until they're economically competitive with coal.
- comicjk 15y ago
  Actually, competing with coal is no longer enough. They have to be able to compete with natural gas, which is getting very cheap. Coal plants are already failing this test: http://www.theithacajournal.com/article/20120103/NEWS01/201030354/Cayuga-Lake-power-plant-owner-declares-bankruptcy?odyssey=tab%7Ctopnews%7Ctext%7CFRONTPAGE http://www.theithacajournal.com/article/20120103/NEWS01/2010...
pocoloco 15y ago
The guys at The Automatic Earth[1] explain that after the multi-decade credit run up enabled by cheap oil would come when peak oil is reached. Once there the financial system is not able to sustain itself without cheap credit it will collapse and a sustained credit deflation will ensue. In this deflation all assets will decrease in price but the difficulty to obtain cash will be harder making them effectively very expensive. This, they explain, will have the effect of making oil cheap to the point that there won’t be enough money to invest in maintaining the current infrastructure and even less to invest in green tech. Once the bad debts are cleared and growth returns the true effects of peak oil will be felt everywhere. In summary, they say, don’t get your hopes up with clean/green tech. It is too little too late and it simply cannot replace oil. And nuclear energy is no better once you take into account the energy required to build, operate and decommission reactors and also dispose of radioactive waste in a safe manner. They have in my opinion one of the best analysis available in the intertubes. [1] http://theautomaticearth.blogspot.com http://theautomaticearth.blogspot.com

31 points by moocow01 15y ago

"Clean Tech" is a big scam...politically connected VC like Doerr ripping off U.S. taxpayers to fund crony capitalist boondoggles like Solyndra and Fisker. The VC get all the upside, and taxpayers have all the downside. If the elites really cared about solving climate change, they would advance honest, technology-neutral policy solutions like a simple tax on carbon production. Instead, from battery cars to ethanol, Green Tech has been an excuse for a multi-billion dollar money grab.

startupfounder 15y ago
WRONG! Clean Tech and Green Tech are not scams, they are investments in our future. Just like any other technology the US has invested in. Like any investment some are good and some go south. If you want to complain about our government "wasting" money and trillion dollar money grabs look no further then the Department of Defense: http://www.nytimes.com/imagepages/2011/03/13/opinion/13opchartimg.html?pagewanted=all http://www.nytimes.com/imagepages/2011/03/13/opinion/13opcha... (note the numbers in this graph are in billions, not millions) Solyndra was a rounding error in what the US Government wastes on defense. VCs are like the government, they only win when companies win. Just like the government VCs loose many, but win big on a few. Government wins when the companies they "invest" in create American jobs. I am not even going to go into you putting "simple" and "tax" next to each other in the same sentence.
- OstiaAntica 15y ago
  Nearly every single American green energy program, from the 1970s to today, has failed, or is in the process of failing. Some, like massive ethanol tax subsidies and mandates, have significantly damaged the environment. Battery cars are a passing fad that are also bad for the environment-- they rely on coal-fired plants for electricity, and much of that power is wasted in transmission. And the batteries are hazardous. The fact that DoD is a bigger waste of money is not a defense of Clean Tech. The real solution is getting the big incentives correct-- tax pollution, and get the government out of the business of picking technology and playing venture capitalist.
  - mkramlich 15y ago
    > Nearly every single American green energy program, from the 1970s to today, has failed, or is in the process of failing. Solar is booming and doing much better than in the 1970's, and there have been many breakthroughs combined to helping getting the cost per watt way down. > And the batteries are hazardous. You do know gas and oil are hazardous and toxic right? You do know that the extraction, processing and consumption of oil and it's byproducts are putting very large amounts of bad stuff into the air we breathe and water we drink, right? You did hear about the various huge oil spills, including the BP Gulf disaster, Nigeria, etc? The whole point of government, one of many, is is to act as a neutral guardian for society's shared resources and common benefits. Individuals and businesses are relatively free to pursue their own interests, but only so far as it does not harm others (ideally), or bring about Tragedy of the Commons kinds of situations. Thus, some regulation, and some punishment/reward mechanisms are in place to help maintain or bring about the kind of world we want to live in. This should be pretty clear, and has no malevolent intent. I do find it funny that some folks never complained that Big Oil was getting subsidies, incentives, breaks, special treatment, etc. but when it comes to solar, wind, anything intended to be a cleaner or renewable energy source, suddenly there are complaints that government is distorting the market place or picking winners. The difference, clearly, is which technology or industry one would personally rather see favored. Put me down for favoring energy sources that are renewable or better for health. This should not be some kind of radical position, because the benefits are pretty clear. We agree that taxing pollution is probably a good thing for government to be doing. But the oil/coal industries world-wide are fighting such things, and they spend lots of money on Congress. And the Republican Party, in particular, does their bidding almost every time a relevant bill comes along.
    - Turing_Machine 15y ago
      Look into the environmental impact of producing solar cells. Semiconductor fab chemicals are nasty stuff, and when you think about how many square miles would be needed for solar to make any significant impact...
- quanticle 15y ago
  So why should the US government invest in clean tech over, say conservation? Moreover, why should the US government be making commercial investment decisions at all? The way I see it, the US government should be investing in basic research, then turning that research over to industry for rapid commercialization. Solyndra was not basic research.
joshmaker 15y ago
The problem with that idea is that in the current political climate any new carbon tax is a dead on arrival. Realistically, the only options that are politically feasible are to either do nothing or else subsidize green tech industries that seem promising.
ScottBurson 15y ago
My understanding (can't find a reference, sorry) was that there was around $1B of private money in Solyndra before the U.S. government added a little over $500M. So while the taxpayers definitely lost, the VCs lost more. But I agree with you about the carbon tax.

Turing_Machine 15y ago

We've had clean, green, safe, carbon-neutral energy for nearly 60 years. Too bad people have been misled into being afraid of it. It's called nuclear power.

boucher 15y ago
You only need to look at the most recent problems in Japan to see that nuclear power is never quite as simple as its proponents suggest. All things considered, it's probably still a much better bet than fossil fuels, and probably still a worse bet than renewables like solar and wind.
- protomyth 15y ago
  Has there ever been a study on large scale wind farms and their affect on weather? I cannot help but think that taking that much energy out of the system might change some things.
  - polymer 15y ago
    On a global scale, wind energy harvesting has a miniscule effect: "should wind supply the world's energy needs it estimates energy loss in the lowest 1 km of the atmosphere to be ~0.007%, which would be an order of magnitude smaller than atmospheric energy loss from aerosol pollution and urbanization"[0]. Of course, the local effect of a large wind plant is different, but given the numbers above I would think it's still negligible. [0] http://www.wse.ie/articles/how-much-wind-energy/index.php http://www.wse.ie/articles/how-much-wind-energy/index.php
    - protomyth 15y ago
      I'm just a little worried about the tendency to put these things in the same states that raise most of the crops and what might be the weather change. Local changes could be problematic.
- Turing_Machine 15y ago

Caerus 15y ago

I've been a huge proponent of "green" energy for years, and after watching it for those years, it's becoming more and more obvious the technology just isn't there yet. The best we can do is pump more money into research and ignore these poorly planned start ups that are only profitable due to subsidies. Every major type of renewable energy has some aspect which makes it at least a decade and several breakthroughs away from viability. Cellulosic/Algae Ethanol: About an order of magnitude off on cost, many orders away on capacity. They are still immature technologies but seem to have a lot of promise. Photovoltaic Solar: Cost is almost there, but no one has a plan for what to do when the sun isn't shining. Solar systems can only produce energy for about 6 hours a day, which presents a problem when we need energy for 24 hours. It doesn't produce energy during peak demand (~5-9pm) to even help with load balancing. People can currently make a small profit selling back to the grid, but there's virtually no chance of it providing more than about 5% of demand. Solar Thermal Collectors: Better than photovoltaic as they can generally produce power for about 8 hours, then molten salt batteries can provide energy for another couple; but still not a viable large scale solution. Wind: Geographically limited, very high maintenance costs. Hydrogen: Only an energy storage medium, not a means to produce energy. In most cases there are more efficient ways to use the energy directly without the additional loss of producing hydrogen. Corn Ethanol: Energy storage medium, and a bad one. The most optimistic numbers I've found indicate it requires about .84 gallons of gasoline to produce 1 gallon of ethanol. Most numbers are significantly worse, in the 1.2-1.4 range. It sounds great if the lower numbers are accurate, but 1 gallon of ethanol contains ~2/3 the energy of 1 gallon of gasoline so it's still a net loss. (note: I haven't done any serious research on sugarcane ethanol, which at first glance appears somewhat better) Hydroelectic: Great technology that is proven, cost effective, and viable; but is severely limited geographically and the dams can cause major environmental concerns. After years of following the news, studying it, and taking classes in renewable energy; it always comes back to nuclear. If it wasn't for legislative bungling, lawsuits preventing new plants, and the occasional (comparatively) minor failure of 40 year old technology we wouldn't even be talking about a clean energy problem. I'd love for one of these technologies to prove me wrong but there is little indication they will in the near future.

comicjk 15y ago
Re solar PV, the problem of the sun not shining is just a bigger-scale variant of load balancing, which has been addressed successfully before. The English grid does it with pumped hydro storage in this mountain in Wales: http://en.wikipedia.org/wiki/Dinorwig_Power_Station http://en.wikipedia.org/wiki/Dinorwig_Power_Station

AngryParsley 15y ago

Peter Thiel had a good analogy in his talk at Singularity Summit: http://www.youtube.com/watch?v=ROrUea0gLlY#t=34m0s http://www.youtube.com/watch?v=ROrUea0gLlY#t=34m0s As with technology, you have to be able to do more with less. Alternative energy has to be cheaper. And until it is cheaper, it's going to be very hard to get it to work. If you had Amazon as a computer company- if you had said in '96, "Yeah it's gonna cost twice as much to buy a book and it'll take you 6 months to get it, but we're going to get subsidies that are really big and that will make the business work and that's why you should invest." That would be quite difficult to work. Cleaner energy sources will take off eventually, but not until they're economically competitive with coal.

comicjk 15y ago
Actually, competing with coal is no longer enough. They have to be able to compete with natural gas, which is getting very cheap. Coal plants are already failing this test: http://www.theithacajournal.com/article/20120103/NEWS01/201030354/Cayuga-Lake-power-plant-owner-declares-bankruptcy?odyssey=tab%7Ctopnews%7Ctext%7CFRONTPAGE http://www.theithacajournal.com/article/20120103/NEWS01/2010...

pocoloco 15y ago

The guys at The Automatic Earth[1] explain that after the multi-decade credit run up enabled by cheap oil would come when peak oil is reached. Once there the financial system is not able to sustain itself without cheap credit it will collapse and a sustained credit deflation will ensue. In this deflation all assets will decrease in price but the difficulty to obtain cash will be harder making them effectively very expensive. This, they explain, will have the effect of making oil cheap to the point that there won’t be enough money to invest in maintaining the current infrastructure and even less to invest in green tech. Once the bad debts are cleared and growth returns the true effects of peak oil will be felt everywhere. In summary, they say, don’t get your hopes up with clean/green tech. It is too little too late and it simply cannot replace oil. And nuclear energy is no better once you take into account the energy required to build, operate and decommission reactors and also dispose of radioactive waste in a safe manner. They have in my opinion one of the best analysis available in the intertubes. [1] http://theautomaticearth.blogspot.com http://theautomaticearth.blogspot.com