‘Efficiency-Tech’ Ready for its Close-Up

Two years ago, I attended a conference where a panel of leading cleantech VCs were asked if they had ever made an energy efficiency investment. The question was met with uncomfortable shifting and dead silence. Michael Kanellos of CNET, noted a similar tendency last year:

“Despite the savings, people have a tough time getting excited about energy efficiency. At clean-tech conferences, attendees will pack the room to see an ethanol roundtable. But when the agenda turns to smart grids, a lot of people take a coffee break.”

Marc Gunther of Fortune has also told me that of all of his columns on CNNMoney, the one that elicited the least interest was about energy efficiency.

But last week it struck me more than ever – especially with talk of a recession – that ‘Efficiency-Tech’, as I’m now calling it, has entered primetime. I was at another conference, where Duke Energy CEO Jim Rogers pronounced that his vision was for the United States to become the “most energy efficient economy in the world” through grid optimization, which he suggested could be the greatest engineering feat of the 21st century. His thesis was that in an ever more resource-strapped world, the economy that best used technology to achieve the greatest amount of efficiency would have a distinct advantage. Mr. Rogers was not alone. Many of the speakers – Dan Reicher of Google, John Podesta of the Center for American Progress, and yes, even leading VCs – invoked the importance of energy efficiency in their remarks. With the US economy poised for a potential downturn and Corporate America starting to tighten its collective belt, the argument can be made that efficiency is also poised — poised to finally take its long overdue place as a legitimate target for significant investment.

It was refreshing to hear Mr. Rogers frame the issue from a perspective of economic competitiveness in the global marketplace. That is a message that resonates with the business community — self-sacrifice, saving the planet, etc have proven repeatedly to fall flat with consumers. Precisely for that reason, another speaker at last week’s conference, CEO of PNM Resources Jeff Sterba, said that there is a need for technology to produce devices that deal with the issue of energy savings, rather than asking the consumer to – “prices to devices, not prices to people” as he put it so well. Tom Konrad of AltEnergyStocks.com had a thoughtful analysis on why energy efficiency is such a hard sell last fall, surmising that people only buy energy efficiency if they are made to feel that they are part of a “conspicuous” movement. The issue is how to make energy efficiency cool. EnerNOC and Comverge have certainly helped the business case, with successful IPOs for the two demand-response companies last year. Mr. Rogers had one other insight that stayed with me, which he said was gaining currency – namely that efficiency should be viewed as a form of production of energy. If this happens, the economics will shift in favor of efficiency even more.

“The mindset that has stymied energy efficiency efforts for a generation has been altered”, says Kevin Klustner in his upcoming book “Energy Efficiency: The Future is Now”. Klustner, also the CEO of Verdiem, is doing his part through addressing PC power waste, a huge issue. And he’s not alone. An energy efficiency survey of business executives done by Johnson Controls in mid-2007, revealed that 50% planned to use capital and operating budgets to increase investment in energy efficiency over the next 12 months. A recession was not in the cards at the time of the survey, so I’m sure that the inclination is now even that much stronger. Ironically, Efficiency-Tech is finally getting what it deserves – more power behind it.

Green Options Kicks Off CleanTechnica

The spectrum of cleantech media continued to fill out this week, following earlier news about the Wall Street Journal Earth2Tech, and other media.. Green Options, a popular online media group focused on making green more accessible to people, went public this week with CleanTechnicaSarah Lozanova, the editor of the new blog, said she and her core team of 5-6 writers hope to tell the stories behind green technology and renewable energy instead of just reporting on them. “A lot of content on other sites is above peoples’ heads,” Sarah told me, adding that CleanTechnica wants to make cleantech “more accessible to a wider audience – to the green curious audience – so it’s approachable.” The blog will initially look to post at least one story per day, and is open to outside contributors, who can provide “different perspectives, experiences and exposures”. Sarah also said they hoped to do a lot of Q&As.