Cleantech Investment Forum
Sunday, 04 December 2005 23:30
Last week, I attended the Cleantech Finance and Investment Forum in Melbourne.
At this conference were representatives from pension funds, investors, venture capital, local government and the renewable energy industry.
A couple of points stood out.
Contrary to what the government is saying about backing emissions reduction, speaker after speaker talked about moving their investment offshore - mostly to Europe - because of the lack of government support here. The most interesting example was Viridis Energy with investments so far in four countries in Wind, Hydro and Waste to Energy.
The US and Canadian companies, in particular Wal van Lierop of Vancouver based Chrysalix Energy spent much of his presentation on looking at how they look for the big opportunities - the places where a technology is about to make the leap from niche to mass market. In contrast Saxon Hill of Sydney based CVC Sustainable Investments concentrated on how they minimise the risk and avoid making bad investments.
This was not an isolated difference, it was mirrored in the discussion between Nicholas Parker of US/Canadian Cleantech Venture Network and John Brakey of Australia's Macquarie Funds Management, and illustrates why there is so little investment in early stage technologies in Australia as compared to the US. It also illustrated why US and Canadian VC's were at the conference, i.e. there are many opportunities in Australia to snap up a bargain because of the lack of local money chasing those bargains. The principle concern for Australians should be that early stage investors would typically require that the companies they are investing in relocate to the US rather than continue development in Australia.
As we move to an energy constrained future, it is important for investment to be occurring in both core technologies and also in projects using these, with both of these moving offshore it means Australia will be more dependent on dwindling fossil fuels rather than less.
- the lack of signing Kyoto means that the carbon credit trading system doesn't bring them the ability to sell their credits on the international market.
- The failure to raise the Mandatory Renewable Energy Targets, which are set at the absurdly low level of 2% by 2010. Essentially both the investors, and the industry were saying that this in effect puts a cap on the renewable energy industry in Australia, so it was safer to take funds offshore.
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