company that is working to develop and produce cheaper solar cells
says it will announce today that it has raised $6.5 million from two
leading venture capital firms.
The investment is one of the latest signs that alternative energy
companies are attracting serious financial interest in
The money raised by the company, NanoSolar, based in Palo Alto,
Calif., is seen as a harbinger because of the strong Silicon Valley
pedigree of the venture capital firms — Benchmark Capital and US
Venture Partners — and the track record of its chief executive and
co-founder, R. Martin Roscheisen. He has already helped start three
successful companies. The most recent, eGroups, was sold to Yahoo
in 2001 for $720 million.
NanoSolar is one of several companies with promising technologies
aimed at narrowing the gap between the cost of solar power and
energy from fossil fuels. With conventional information-technology
companies in a protracted slump, investors are taking a fresh look
at companies working on renewable energy.
Draper Fisher Jurvetson, a venture capital firm in Redwood City,
Calif., invested $6.5 million last year in Konarka Technologies, a
company in Lowell, Mass., developing low-cost flexible solar panels.
And Idealab, a technology incubator in Pasadena, Calif., led by Bill
Gross, is behind Energy Innovations, a start-up company working on
an engine that could convert sunlight into electricity.
"We think that there's a tectonic shift coming," said Tim Draper,
a partner at Draper Fisher. With a finite supply of fossil fuels,
over time the price of conventional energy will increase, he said.
"That allows some of these alternatives to come in."
Solar power, in particular, is going through a new cycle of
innovation as advances in materials science and nanotechnology,
which uses materials as small as molecules, are paving the way for
approaches that could drastically lower the cost of solar
A new generation of solar cells based on lightweight conductive
plastics could cost as little as $40 a square meter, compared with
$400 for the silicon panels that have been used since the 1970's.
These so-called organic solar cells could make solar a viable option
even without government subsidies, experts say.
Unlike silicon, plastic cells do not require high temperatures or
equipment similar to that used to manufacture computer chips. They
are also more flexible and therefore may be easier to use in a range
of places, including rooftops, window blinds, cars, or even
Plastic cells have their drawbacks, however. They are less
efficient than silicon, at least for now, and are not expected to
hit the market until 2005.
NanoSolar asserts that it has solved some of the thorniest
problems inherent in working with organic materials. The company,
applying technology licensed from Sandia National Labs, says it has
brought an architectural approach to the process, using
self-assembling nano-structures that should substantially improve
the energy efficiency of its solar cells.
Arati Prabhakar, a partner at US Venture Partners, said that
NanoSolar's approach holds great promise. But, she cautioned, "it's
very, very early stage."