Cleantech companies just can’t seem to get it right.There is no doubt that unrealistic expectations about governments increasing the costs of energy through cap-and-trade legislation contributed to the notion that clean tech would become competitive by making the alternatives cost more. Thiel may be right about the need for more engineers in the industry, but they may need more pragmatic policy analysts as well. His bottom line is right on target -- we need less expensive energy.
At least, that’s the notion Peter Thiel — a co-founder of PayPal and president of Clarium Capital — subscribes to when he looks at cleantech companies as potential investing opportunities. He made the comments at a Commonwealth Club event in San Francisco Wednesday.
Despite all his talk about a distinct lack of innovation that improves everyday life in silicon valley, Thiel has been surprisingly bearish when it comes to cleantech companies — those that specialize in producing more energy-efficient and environmentally friendly energy, transportation methods and others. That’s not because he doesn’t believe in the technology — he just doesn’t like the way the companies are run, he said.
“Most of the people who run cleantech companies are sales people, not engineers,” Thiel said. “Something seems to have gone quite wrong with cleantech.”
As a result, most cleantech companies that try to develop alternative energy forms are building power sources that are more expensive. Solar panels, for example, are still not a cost-efficient way to generate power because companies have made the assumption that people will pay more for more environmentally friendly ways of producing energy, Thiel said.
“We need something cheaper, not more expensive,” he said. “It doesn’t matter if the energy is cleaner, it doesn’t work if it’s more expensive.”
03 February 2011
Clean Tech Innovation and the "Iron Law"