China leading the way in all aspects of clean energy development
U.S. venture capital investors in new energy technologies are beginning to groom their portfolio companies for increased business in China, given favorable government policies and more availability of capital.
Many U.S. clean technology companies already rely on Chinese manufacturers for their component parts. Now, investors said, U.S. companies are turning to China for capital as well.
“The funding crunch in the U.S. is really severe,” said Jiang Xiaodong, a managing director with New Enterprise Associates and head of the firm’s operations in China. “And a lot of the Chinese companies that are listed on the SME [board of the Shenzhen Stock Exchange] exchange and on ChiNext raised a lot of money and now they want to spend it in a way that gives them access to technology and future growth opportunities.”
Earlier this year, Tucker, Ga.-based Coaltek Inc. partnered with Guangdong Yi Jian Investment Co. to build a 10 million-metric-ton per year coal-treatment facility, which uses the company’s technology to turn low-grade coal into a higher burning, more powerful and less-polluting fuel. They’re building a plant together in Inner Mongolia that will ultimately cost $250 million.
Coaltek’s investors see similar opportunities with other companies in their portfolio. “We’re looking at things that have been developed [in the U.S.], but are not really ramping because of the availability of capital,” said Michel J. Maloof III, a principal with Braemar Energy Ventures, which has been an investor in Coaltek since the company’s first round.
This is all food for thought when we consider that our government is considerably anti-capital and anti-business. Sure, the president will tap dance for a photo-op at a plant that makes batteries for electric cars. But his people will make sure that said plant will operate only with the benefit of union workers. Anything less is not a viable option. Costs increase, regulatory requirements become more and more onerous and, as I noted previously, the US prices itself out of the market for innovation and capital that are necessary to develop a significant market presence.
The left loves to decry capitalists, capitalism and profits for shareholders. At the same time, they also genuflect before the altar of progressive utopianism when it comes to alternative energy.
They want their wind turbines, but crap on those who want to make it a profitable enterprise. Flushing money down a toilet is not a way towards energy independence, and government will not provide solutions brought down from the clouds on a magical unicorn. You can’t have it both ways.