Clean tech can mean big business for small innovative firms

It should not be a surprise that tech industry titans, including Microsoft’s chairman and former CEO, Bill Gates, are pushing the U.S. to dramatically increase spending for clean energy technology. The IT links to clean technology get stronger by the day, and if the push by Gates and venture capitalist John Doerr to get the federal government to triple its research and development spending succeeds, Silicon Valley is certain to benefit.

One person who illustrates the multidimensional connections among IT, federal funding and clean tech is Gene Wang, CEO of People Power Co.

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Wang’s 18-month-old company has developed what it calls an Open Source Home Area Network (OSHAN) that connects household appliances and other energy-using devices to a Web-based portal for energy tracking. It has a kit, available for $150, called SuRF, for Sensor Ultra-Radio Frequency, that developers can use to create wireless energy sensors.

Wang’s company, based in Palo Alto, Calif., is funded through venture capital but also with federal help, through a U.S. Small Business Innovation Research-Small Business Technology Transfer (SBIR-STTR) grant from the U.S. Department of Energy. Wang has a long history of working in IT, including serving as a vice president of marketing for Hewlett-Packard Co.’s handheld business unit. He also incorporates IT’s open-source ethos in his approach.

At a press conference today to release a report on clean tech, both Doerr and Gates said the U.S. needs to triple its research and development spending from $5 billion to $16 billion if it wants to achieve global leadership in this area, in much the same way it has achieved leadership in biotechnology and IT.

Doerr, Gates and other business leaders were due to meet later Thursday with President Barack Obama.

Wang said China, in particular, is focusing billions of dollars on green technologies. “We somehow have this picture that the Chinese are good low-cost manufacturers but they don’t have good engineering, and while there still may be some truth to that depiction, it is really by and large not the case. So we had better really watch out and double and triple down on our priorities,” Wang said.

But the U.S. also has an obligation to the world to adopt clean tech, because of its huge energy consumption on a per-capita basis, Wang said.

The U.S. has been investing heavily in smart grid and smart meter technology, but Wang said the focus is too narrow. “Smart meters actually remove jobs; smart meters really benefit the utilities,” he said.

While Wang sees the benefit of gathering information over a network instead of relying on meter readers, “that’s not the kind of innovation breakthroughs we need,” he said.

If the U.S. steps up its research and development spending on clean tech, Silicon Valley will likely benefit. Today the valley gets about one-third of U.S. venture capital funding, said Stephen Levy, director and senior economist at the Center for Continuing Study of the California Economy (CCSCE) in Palo Alto. Federal dollars make up some share of that VC funding, he said.

“The R&D funds are nice, but the big impact will be from companies starting to build on the R&D,” Levy said. “Silicon Valley grows based on being a site for the next round of innovation,” and clean tech and energy efficiency are certainly “candidates for the next big round of innovation.”

Patrick Thibodeau covers SaaS and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at @DCgov or subscribe to Patrick’s RSS feed . His e-mail address [email protected].

Source: Computerworld

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