Clean Tech Software Applications in High Demand

As the global interest to reduce greenhouse gas emissions inspires numerous entrepreneurs in Silicon Valley to pursue clean tech, many wonder what area of their industry appears to have the most promise.

At the seminar, "Cleantech Startups in the United States and China in 2011; Opportunities and Realities of Funding" Wednesday at the in Mountain View, a group of panelists reached a consensus on the matter: Software that monitors energy usage could be the wave of the future.

Eric Wesoff, a senior analyst at Cupertino-based Greentech Media, said software applications that monitor energy usage are "in high demand," and an investment in clean tech software start-ups would "cost much less" than building a solar plant.

The demand for this type of software is especially needed in China, according to the panelists, where the government mandates that all buildings monitor their energy usage, explained Anders B. Axelsson, senior vice president of Echelon

Shannon Fraser, a senior international trade specialist with the U.S. Department of Commerce, added that the promotion of energy efficiency is worthy of investment.

From a global perspective, Wesoff reminded attendees that the United States has only 9 percent of the world's photovoltaic (PV) cells, the electrical devices that directly convert the energy of sunlight into electricity.

In the lead is China, Wesoff said, which is now the No. 1 global producer of PV cells, even though the country didn't start solar production until a few years ago. This contrasts with the many American start-ups now trying to catch up, according to Wesoff. He's called the competition in the solar sector of clean tech "a bloodbath."

In the meantime, there's an increasing amount of interest in energy storage. Wesoff said the most widespread and deployed energy-storage technology is pumped hydro, with 120,000 megawatts of capacity worldwide.

China leads in this area, too, as it is second in the world in wind energy and will soon be the leader, with a goal of 150 gigawatts by 2020.

Wesoff attributed China's remarkable success in clean tech to government support, which has pumped $3 billion into solar energy development, compared with $150 million for solar technologies from the U.S. Department of Energy.

Similarly, Axelsson expressed that China's success in building smart grids—the application of computer intelligence and networking to electricity transmission and distribution—has had the additional success in that it connects China's cities on both coasts.

"When a policy comes out in China," said Axelsson, "there's no discussion, no politics. It just gets implemented."