Solar startup Morgan Solar plans to announce Thursday that it has raised $16.5 million in venture-capital funding. After declines in the second half of 2010, U.S. cleantech investment has been on the rise so far this year, with solar companies getting the most money, analysts say.

Founded in 2007 by company president John Paul Morgan and his brother Nicolas, Morgan Solar has developed a concentrating-photovoltaic technology that it claims can convert more sunlight into electricity at a lower cost than competing technologies. The technology involves staggered rows of thin, hexagonal optics that direct light to triple-layered solar cells positioned at the edges of the rows.

The company says the initial commercial panels will be able to convert sunlight into electricity with 25 percent efficiency, which is higher than most conventional silicon-based panels but lower than some other concentrating PV technologies. Even at its current low volumes, its cost is on par with that of traditional panels, Morgan told us in an interview, adding that the company expects to be able to deliver a levelized cost of energy – meaning the total cost of energy, with everything included – competitive with that of thin-film solar in many markets by 2012.

Still, he acknowledged the company faces plenty of challenges in the next year to make that happen. “I don’t want to stop at just being better than solar; I want to compete with coal,” he said. “A lot of things have to be executed correctly – we have to ramp up right and drive down this plan of bringing costs down and efficiency up.  … The details are what are going to make us take this to the next level. And the details are where we’re at now.”

Morgan Solar’s latest deal is the first tranche of its second round, which the company expects to close with $25 million in the next few months, company president John Paul Morgan told us.

News of the funding comes at an important stage for Morgan Solar, when the company hopes to transition from demonstration projects to its first commercial shipments. It is installing a 200-kilowatt demonstration plant in Lancaster and plans to ship its first commercial panels this year. The company, which is already shipping test panels, had previously aimed to ship its first commercial panels last year.

“2011 and 2012 are going to be the most important years in this company’s history,” Morgan said. “This year, when we’re really demonstrating [our product] in the market, taking it to customers and deploying it on a large scale, is really going to be what tests the mettle of the team and of the company and demonstrates to the world how big of a deal this all is.”

Morgan Solar ran into some speed bumps during its internal testing last summer, when it discovered some issues that could result in some defective panels, he said. “We’ve ironed all that out,” he said, adding that he now expects the panels to get international certification by early next year.

The company plans to use its newfound cash – along with its $3.3 million loan guarantee – to grow its optics factory in Chula Vista, Calif., which Morgan said is on track to begin production in the next few months. The factory already has some of its equipment in place and will initially have the capacity to produce 5.5 megawatts a year, then will expand to 50 megawatts of annual capacity by the end of next year, he added.

The 50-megawatts of capacity near San Diego will cost $13 million, Morgan confirmed. “We can ramp up much more cheaply than other companies,” he said, adding that most of the company’s first-round funding went into research and development, lab equipment and testing equipment, not capital expenses. “That’s why we’re not trying to raise $100 million.”

Morgan Solar will also use some of its new capital to expand its panel assembly, as well as research and development – including testing, engineering and design work – at its Toronto headquarters, Morgan said.

Investors in the latest tranche include big Spanish utility Iberdrola’s venture arm, Inversiones Financieras Perseo, which led the deal; existing investor Nypro, which makes Morgan Solar’s optics; and pharmaceutical billionaire Phillip Frost’s The Frost Group, a new investor. Turnstone Capital Management, which led Morgan Solar’s first VC round, didn’t participate in this tranche.

The deal brings the Toronto-based company’s total private capital to $26.3 million. It also has received $10.3 million in U.S. and Canadian government funding, and has won a $3.3 million loan guarantee from the California Energy Commission.

Companies: Inversiones Financieras Perseo, Morgan Solar, Nypro, The Frost Group

People: John Paul Morgan

Article courtesy of VentureBeat » deals

Shares of Chinese solar energy technology provider Yingli Green Energy (YGE) are down 72 cents, or 7%, at $9.24 after the company this morning missed Q1 estimates on a decline in photovoltaic module shipment, in line with a pre-announcement last week, but re-affirmed its year module shipment target.

Yingli’s Q1 revenue rose 41% to $527 million, missing the average $573 million estimate, yielding eps of 38 cents, a penny below consensus.

Yingli said it shipped fewer modules than expected thanks to “decreased PV module shipment as a result of the policy change in Italy.”

Module shipments fell by “a low teen percentage” from Q4′s level. The company expects shipment volume to rise 30% in Q2.

“Although solar policy changes in certain European countries have caused short term market fluctuations, in the long term, we continue to view Europe as one of our most important markets,” said CEO Liansheng Miao.

Yingli reaffirmed its shipment forecast of 1.7 gigawatts to 1.75 gigawatts this year.

Among analyst reactions this morning, Jesse Pichel with Jefferies & Co. reiterated a Buy rating on the shares and a $19 price target. The big issue is competitor Trina Solar’s (TSL) quarterly miss, reported on Tuesday, and Trina’s remarks that it will get more aggressive on pricing. How will YGE respond? “Our channel checks indicate that YGE is strongly preferred in Europe over TSL, and thus it may not have to be as aggressive on price, but could if needed given its low cost structure.”

On the other hand, Timothy Arcuri with Citigroup reiterates a Sell rating, and an $11 price target, writing that a rise in days of inventory for YGE from 84 to 110 is evidence for an “inventory build in the supply chain.”

“We continue to think challenges related to the startup of poly operations will hamper the outlook for YGE relative to its peers, and continued reliance on Germany is also a concern given out outlook is for that market to have declining share of global demand going forward.”

Article courtesy of Tech Trader Daily

LAST DAY TO ENTER!: GofG L.A. wants to send you and a friend to the 2011 Billboard Music Awards this Sunday. Thanks to Chevrolet, we have FIVE PAIRS of tickets to give to FIVE lucky winners to attend the Las Vegas awards show which features a mega lineup of live performances from some of music’s hottest artists, including the Black Eyed Peas, Rihanna, Keith Urban, Taio Cruz, Cee Lo Green Nicki Minaj, Pitbull, Kesha, Far*East Movement, OneRepublic, Ryan Tedder and Ne-Yo! Keep reading to find out how you can enter to win a pair! **CLOSES TODAY AT 5PM PST** Read the full story

Commodity hedge funds upbeat after mauling (FT)
Last week saw the largest daily trading volume in Brent crude’s history as investors – a large proportion of them hedge funds – began to liquidate positions in a stampede to reduce risk. It was a rush to the exits that was seemingly without cause, however. Many fund managers are at a loss to explain what triggered the panic, dismissing the explanations that have been proffered – weak US economic data, a hike in commodities trading costs or even hedging upcoming equity exposure to the giant Glencore listing…But crucially such losses – unattractive though they are – have done little, if anything, to dent managers’ confidence in the long commodities play.

AIG Offering Near Low End of Range (WSJ)
American International Group Inc. and the Treasury decided to move ahead with a stock offering this month for about $9 billion, far less than what officials had once hoped to fetch, people familiar with the decision said…[AIG's board] decided to proceed with plans for an offering near the low end of a range envisioned by people familiar with the plan of $7 billion to $25 billion, depending on investor demand and market conditions.

Banks Float $5 Billion Deal to End Foreclosure Probe (WSJ)
Such an offer is considerably less than the amounts sought by state and federal officials, some of whom are asking for more than $20 billion in penalties. The banks’ figure comes as mortgage companies and state and federal officials continue their efforts to strike a settlement of investigations sparked by allegations of “robo-signing” and other questionable foreclosure practices that came to light last fall.

Preemptive strike against high prices may be needed, Fed official says (WaPo)
The Federal Reserve needs to be prepared to take preemptive action against even the possibility of a surge of higher prices, a senior official of the central bank said Tuesday. Jeffrey M. Lacker, president of the Federal Reserve Bank of Richmond, added in an interview that he doesn’t think the recent rises in the price of fuel and other commodities will spiral into a broader inflation, but he cautioned that the central bank needs to remain vigilant.

Dodd-Frank Dissenters Sound Off (Dealbook)
And Ken Griffin, founder of the $15 billion hedge fund Citadel Investment Group, went the furthest by proclaiming that not only would the legislation not work as proposed, but it is “going to deeply entrench crony capitalism into the very fabric of our financial system, which I am terrified about.”

Ex-Galleon Trader Kimelman Wants Jury Told He Rejected Plea Deal With U.S. (Bloomberg)
Former Galleon Group LLC trader Michael Kimelman said he wants jurors at his upcoming insider- trading trial to be told that he could have avoided jail by admitting guilt and rejected a plea deal because he’s innocent. Kimelman is scheduled for trial on May 16… The government’s offer would have had Kimelman plead guilty to conspiracy to commit securities fraud and “was still available last week,” according to the filing.

FDIC warns on moral hazard for money market funds (Reuters)
[Sheila] Bair, outgoing chairman of the Federal Deposit Insurance Corp, said regulators needed to be mindful of so-called moral hazard in creating a backstop for the $2.7 trillion industry. During the financial crisis, the federal government was forced to backstop the market after the collapse of Lehman Brothers pushed the value of the Reserve Fund money market fund below $1 a share, wreaking havoc on the industry.

China Inflation Signals More Tightening to Come (Bloomberg)
China’s inflation held above 5 percent in April and lending exceeded analysts’ estimates, signaling that further monetary tightening may be needed to cool the fastest-growing major economy…Today’s data showed that inflation has exceeded Premier Wen Jiabao’s 4 percent target each month this year.

German Inflation Accelerated More Than Estimated (Bloomberg)
The inflation rate, calculated using a harmonized European Union method, jumped to 2.7 percent from 2.3 percent in March, the Federal Statistics Office in Wiesbaden said today. That’s an upward revision from the first estimate of 2.6 percent on April 27. From March, consumer prices rose 0.3 percent, more than the 0.2 percent initially reported.

Bank of England cuts growth forecasts (FT)
The Bank’s central forecast now predicts growth of about 2.7 per cent in the four quarters to the end of this year, down from its February forecast of growth of 2.9 per cent, assuming no change in monetary policy. Growth in the year to the end of 2012 is expected to be about 2.8 per cent rather than 3.2 per cent. Inflation is forecast to peak this year at about 5 per cent in the fourth quarter, rather than at about 4.5 per cent. By the end of next year, inflation is expected to reach 2.4 per cent, compared with an earlier forecast of 1.7 per cent.

Greek unions hold new general strike, plan demonstrations, to protest harsh austerity (WaPo)
A 24-hour general strike in Greece Wednesday brought most public services to a halt, while thousands marched through Athens to protest the government’s introduction of harsh austerity measures intended to keep the debt-ridden country solvent. This month, the Socialist government is planning to pass further cutbacks aimed at saving an estimated €23 billion ($33 billion) through 2015.

Google Sets Aside $500 Million for Probe (Bloomberg)
Google set aside $500 million related to the possible resolution of a U.S. Justice Department investigation of its advertising business, resulting in lower first-quarter profit. The expense trimmed net income to $1.8 billion, or $5.51 a share, in the period, Google said yesterday in a regulatory filing.

Stanford Trial Set for September (WSJ)
Jailed money manager R. Allen Stanford will go to trial on wire-fraud and other charges in September, a federal judge in Houston has ruled. Jury selection will begin Sept. 12 in the trial of Mr. Stanford, who has been accused of running a $7 billion fraud, according to an order issued by U.S. District Judge David Hittner in Houston on Tuesday.

‘Mack’ the life (NYP)
Mark Madoff’s widow, Stephanie, filed two name change petitions to distance herself and her children from her husband’s notorious last name. After the couple received numerous threats, Mark gave Stephanie his blessing to change her last name to “Morgan” in February 2010, and since then she’s been called Stephanie Morgan. When the name change request was reported, sources say Morgan filed a second petition to change her family name to “Mack.”

Female peacock escapes from Bronx Zoo, still on the loose on NYC streets (NYDN)
The Bronx Zoo cobra may be back in captivity, but a female peacock is on the loose. Three zoo workers wielding nets made a failed attempt to recapture the green peahen about noon on Tuesday…Zoo workers crawling stealthily through the grass got within a few feet of the feisty fowl before she flew off again. She hasn’t been seen since…”We’ll get her eventually,” vowed Nancy Clum, the zoo’s curator of ornithology.

Article courtesy of Dealbreaker

Solar energy technology stocks are largely on the mend today after several days of slack performance, following word that Italy signed the long-awaited decree for its revision of subsidies for solar projects, which should provide some closure for vendors and their customers in the country.

Reuters’s Svetlana Kovalyova and Stephen Jewkes today report that the decree, which must be published in Italy’s “Official Gazette,” prescribes gradual subsidy reductions until 2013, and subsidies from that time on that will be based on targets for meeting a level of installed capacity.

Kovalyova and Jewkes write that the subsidies will be “capped” at €6 billion to €7 billion a year from now through 2016, when an installed capacity of 23 gigawatts is expected, with an expectation of “grid parity” for solar in 2017.

More on the decree is here, at Italy Global Nation, and here’s the Google Translation.

Aaron Chew with Hapoalim Securities today notes that the decree excludes any change to rooftop solar projects that are below one megawatt, extends a deadline for ground projects to be registered with the government from May 31st to August 31st, and closes a loophole that would have saved ground installations.

“While the revision is incrementally positive relative to the April 19th draft, it nevertheless suggests Italy will be more of a drag than a boost to global solar demand going forward,” writes Chew. Chew thinks there may be “further downside through May earnings season” given that there is 2.5 gigawatts of solar inventory, by his estimation, and a “vacuum of demand in the second half of the year, and further declines in 2012.”

As far as the stocks are concerned, SunPower (SPWRA) shares are up 1% today, Trina Solar (TSL) is up 1%, First Solar (FSLR) is up 1.3%, Jinko Solar (JKS) is up 1.4%, Yingli Green Energy (YGE) is up 1.4%, JA Solar is up a fraction of a percent, LDK (LDK) is down 1%, and Suntech Power (STP) is down a fraction of a percent.

Article courtesy of Tech Trader Daily

Shares of solar energy technology provider Energy Conversion Devices (ENER) are down 77 cents, or 24%, at $2.39, after the company yesterday afternoon warned that changes in subsidies in France and Italy may cut its revenue this quarter by as much as 50%.

CEO Mark Morelli remarked, “The dramatic and abrupt shift in the French and Italian solar incentive structures has impacted our business and forced us to reconsider our near-term financial outlook.”

However, Jefferies & Co.’s Jesse Pichel warns against drawing too broad a conclusion from Energy Conversion’s woes.

The company is “uniquely worse off in Italy,” he writes, with the 75% of its sales coming from that country and from France. Italy was in fact 45% to 50% of the December quarter’s sales, he notes.

“Tier One brands can reallocate,” he believes, and projects will resume in Italy in the second half of this year once subsidy issues are settled.

Pichel recommends Satcon (SATC), Sunpower (SPWRA), Yingli Green Energy (YGE), and Trina Solar (TSL).

Shares of solars are broadly lower this morning, albeit in a generally weak market: First Solar (FSLR) is off $1.05, or 0.8%, at $139; Sunpower is down 67 cents, or 5%, at $13.99; Trina is down 35 cents, or 1.4%, at $24.47; YGE is off 16 cents, or 1.5%, at $10.22; and SATC is down 12 cents, or 3.6%, at $3.36.

Article courtesy of Tech Trader Daily

Regarding yesterday’s somewhat obscure state of affairs among Italian regulators as regards solar energy rules, I would note that Reuters’s Alberto Sisto later in the day updated his report on the matter from Rome.

Sisto writes that Italy “removed an 8,000 megawatt limit on photovoltaic production incentives,” and that regulators “will draft a new support scheme by the end of April for plants that connect to the grid after June 1, which will set a annual cap on the cumulative capacity eligible for incentives.”

Sisto notes the Italian Minister of Economic Development, Paolo Romano, remarked that there is, “No cut, no cap, no stop to the manufacturing sector development has ever been envisaged.”

Solar stocks are trading mixed this morning amidst a generally weak market, with First Solar (FSLR) up $1.20, or 0.8%, at $147.17, SunPower (SPWRA) down 6 cents, or 0.4%, at $16.64, Yingli Green Energy Holdings (YGE) down 19 cents, or 1.7%, at $11.27, LDK Solar (LDK) up 2 cents at $12.76, and Trina Solar (TSL) up 39 cents, or 1.4%, at $27.46.

Many thanks to those who chimed in as regards the proposal text that I posed online. I appreciate your contributing your insights and observations.

Article courtesy of Tech Trader Daily

Shares of solar technology providers have come under substantial pressure today following a draft proposal by Italy‘s Ministry of Economic development, which some on the Street believe could sharply curtail demand for solar panels in the market that has been the most vibrant for the industry in the last several months.

The ministry’s draft proposal, viewable here, was covered over the weekend by the Italian press, with headlines such as “Fewer Incentives on Photovoltaics,” and even claims by some in Italy that the new rules would be equivalent to breaking the renewable energy industry in the country.

is expected to be considered by Italy’s Cabinet on Tuesday. If it does not meet with objection, it may be passed into law as soon as Thursday, writes Morgan Stanley analyst Smittipon Srethapramote.

Srethapramote,  after looking through the report, notes that not only does it propose suspending subsidies for solar installations once installations of 8 gigawatts of capacity are installed in Italy, but it also introduces some restrictions he had not expected. There would be a cap placed on ground-mounted plans on farmland, and there would be a maximum ratio set of 100 kilowatts of installation “per hectare for ground-mounted plants on farmland.”

The upshot,  Srethapramote thinks, is that if “left unchanged, these provisions could lead to a dramatic slow down in the Italian market.”  Srethapramote thinks that First Solar (FSLR) and SunPower (SPWRA) will be less adversely impacted than other solar names, given that there they have sources of revenue from other markets, such as the U.S. However, he also argues that “they will still likely suffer some degree of multiple compression in the coming months as volume and pricing expectations for the group are reset.”

My colleague Bill Alpert a week ago gave an overview in Barron’s print edition of the potential decline in Italian subsidies and the consequences for the industry following what was a very robust Q4 for the group.

The stocks are down across the board today:

FSLR is off $8.33, or 5.4%, at $147.39;
SPWRA is down 50 cents, or 3%, at $17.07;
SunTech Power Holdings (STP) is down 47 cents, almost 5%, at $9.51.
Yingli Green Energy (YGE) is down 81 cents, or almost 7%, at $11.55;
JA Solar Holdings (JASO) is down 29 cents, or 4%, at $7.06;
Canadian Solar (CSIQ) is down 87 cents, or 6%, at $14.53;
Trina Solar (TSL) is off $1.47, or 5%, at $27.60.

Evergreen Solar (ESLR) is one of the few gainers, up 12 cents, or almost 6%, at $2.22.

Article courtesy of Tech Trader Daily

Here’s our roundup of the week’s top tech business news. First, the most popular stories VentureBeat published in the last seven days:

Will Apple’s subscription plan spark a developer exodus? — For developers, it seems like it’s Apple’s way or the highway. And the highway is getting more appealing every day.

Apple iPad 2 said to be unveiled at March 2 event — Apple will finally debut the iPad 2 at a San Francisco event on March 2.

HP’s new business laptops offer up to 32 hours of battery — Hewlett-Packard announced a new family of laptops for business users with new industrial designs and one very interesting feature: a battery life of up to 32 hours.

Amazon takes on Netflix with Prime instant videos — This is Amazon’s first move to counter Netflix’s streaming video dominance.

Apple rumored to launch new Macbook Pros — Rumors said Apple was going to introduce new MacBook Pro laptops last week — and it did.

And here are five more stories we think are important, thought-provoking, fun, or all of the above:

Room 77 helps you avoid bad hotel rooms — There’s no shortage of ways to book hotel rooms online, but most services have little information about one of the most important factors — the quality of the room itself.

Grameen IT CEO on how technology transformed Bangladesh — Kazi Islam describes his job as “implementing the future”.

Apple looks towards music files that surpass CD quality — Apple, the company responsible for the widespread popularity of heavily compressed music, is looking into offering high-fidelity music files that will surpass the quality of CDs.

Google’s investment in Transphorm could be good news for electric cars — Google is backing a startup called Transphorm, whose power-conversion efficiency technology could some day help create more efficient electric cars.

Killzone 3 with Move controller: a novel but not brilliant gaming experience — Sony’s newly launched Killzone 3 video game for the PlayStation 3 promised to be a big step up in first-person shooting sci-fi combat, but it has serious shortcomings.

Tags: iPad 2, Killzone 3, Macbook Pro, Sony Move

Companies: Apple, Google, Grameen IT, Hewlett Packard, HP, Room 77, Sony, Transphorm

Article courtesy of VentureBeat » deals

Transphorm came out of stealth today with the high-profile backing of Google Ventures and Kleiner Perkins, and power-conversion technology it says can tackle billion-dollar energy losses.

With its power switching technology, Transphorm is taking aim at a billion-dollar inefficiency issue in energy: losses that inherently happen in energy conversion. When you juice up your cell phone, the charger converts the grid’s alternating current (AC) to direct current (DC), but some of the power is lost during the conversion process. Transphorm makes a device that can cut up to 90 percent of that power loss.

It may seem like a rote topic, but the scale of the issue is huge because just about everything that uses electricity requires power conversion. Transphorm says conversion losses account for 10 percent of all energy generated in the U.S. — $40 billion worth of electricity or the equivalent of 318 coal-fired plants, more than all the power generated by renewables (see chart below).

It’s also a potentially lucrative area for investors. GE recently spent $520 million to acquire Lineage Power, a power-conversion company that GE said would give it access to huge money-making opportunities in the telecom industry and greening data centers.

“You can take the whole West Coast of America off the grid if you can save the conversion losses that occur,” said CEO Umesh Mishra in an interview with VentureBeat. “It is a big problem in energy efficiency today, and it is one that is hard to tackle.”

Transphorm’s approach clearly got the attention of Google, which has made strides in greening its data centers — a popular topic in cleantech, as data centers are huge and expensive consumers of energy. Transphorm’s investors also include Foundation Capital and Lux Capital. The company raised $20 million in a third round of fundraising last May, but didn’t go public with its plan and investors until today.

Transphorm’s innovation is in its switching devices and module design. The company embeds power conversion devices in circuits and modules specifically designed for use in segments like solar inverters and industrial motors, so it’s not a plug-and-play product, which Mishra says others have tried in the past. Gallium nitride is part of Transphorm’s equation — it’s a fairly new material commonly used in LED lighting and is “ideal power switching material,” Mishra said, because it is a low-resistance material that can simultaneously hold off large voltage. Power-conversion devices are traditionally made using silicon.

“There is no further pathway for silicon. It has just reached its fundamental materials limits. [Other scientists] have shown what the maximum limits are, and we’ve broken them,” Mishra said.

Integrating gallium nitride into a power-conversion switch isn’t easy, though, so Mishra says that’s part of the company’s special sauce. Transphorm embeds and connects the technology to application-specific modules that ultimately deliver energy efficiency. It then sells the solution to manufacturers, who integrate it into their products.

The approach can be used to solve energy inefficiency problems in a broad spectrum of power conversion. Markets that Transphorm has singled out include servers in data centers (converting AC to DC),  motors that power elevators (AC to AC), hybrid cars (DC to AC) and solar panel inverters (DC to AC).

The company isn’t releasing details of the cost of the device or how long return on investment takes. As is the case with most energy efficiency plays, Transphorm’s customers can expect to earn back their investment through money saved on reduced energy use.

What’s next? The company says it will be announcing customers across its target markets in the next year, starting with an announcement at the Applied Power Electronics Conference in Fort Worth, Tex. in two weeks. Right now, the company is focused on using the proceeds from the $20 million round to support current orders for its customers. But demand has been strong, and Mishra says the Goleta, Calif.-based company will be looking to expand its facilities next year and will aim to raise another round of funding at that time.

“We’re getting terrific customer pull. The technology has just emerged. We’ve just begun what’s going to be an amazing ride in the development of the technology,” Mishra said.

[Top image via Flickr/kk+]

Tags: data centers, energy efficiency, green data centers, power conversion

Companies: Foundation Capital, Google, Google Ventures, Kleiner Perkins, Lux Capital, Transphorm

People: Umesh Mishra

Article courtesy of VentureBeat » deals