Subject: RE: Really Interesting Article - Top Ten Green Giants
From: "Neil Callahan" <[email-masked]>
To: "'Eric Schwerin'" <[email-masked]>, "'Hunter Biden'" <[email-masked]>, "'Devon Archer'" <[email-masked]>, "'Michael Muldoon'" <[email-masked]>
Date: Mon, 19 Apr 2010 16:54:23 -0400

Interesting.  Devon and I know a lot of senior folks at Cisco.

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Neil Callahan

Rosemont Seneca

401 Greenwich Street, Suite 400 | New York NY 10013 | 212-933-9965

1010 Wisconsin Avenue, Suite 705 | Washington DC 20007 | 202-333-1880

917-945-9516 (mobile) 

866-749-8879  (fax) 

From: Eric Schwerin [mailto:[email-masked]] 
Sent: Monday, April 19, 2010 4:50 PM
To: Hunter Biden; Neil Callahan; Devon Archer; Michael Muldoon
Subject: Really Interesting Article - Top Ten Green Giants

MICHAEL KANELLOS: APRIL 19, 2010

Top Ten Green Giants

What are the most important companies in greentech? Hint: many are over 100
years old.

While startups have played a crucial role in getting the green industry off
the ground, the future will likely be dominated by large, sprawling
conglomerates. Why? Green technology essentially involves revamping the
physical infrastructure of the modern world: replacing coal-fired power
plants with wind turbines, building homes from materials concocted in
chemistry laboratories, and swapping out engines for electric motors.
Established companies are simply in a far better position to muster the
capital, technological depth, managerial expertise and factory capacity that
will all be needed to make the transition.

Familiarity plays a big role, too. Millions have flocked to play Farmville,
but you won't see the same sort of giddy enthusiasm for those installing
high voltage power lines or sewage-to-drinking-water plants. If the internet
boom was a twenty-something billionaire, clean tech is a science teacher
with a comb-over.

With that in mind, here is our list of the top ten Green Giants: the
companies most likely to produce, develop and promote the ideas and products
that will have the widest ranging effects.

1.    <http://www.greentechmedia.com/articles/read/top-ten-green-giants>
Communist Party of the People's Republic of China

2.    <http://www.greentechmedia.com/articles/read/top-ten-green-giants/N2>
General Electric

3.    <http://www.greentechmedia.com/articles/read/top-ten-green-giants/N3>
Siemens

4.    <http://www.greentechmedia.com/articles/read/top-ten-green-giants/N4>
Nissan

5.    <http://www.greentechmedia.com/articles/read/top-ten-green-giants/N5>
Dow Chemical

6.    <http://www.greentechmedia.com/articles/read/top-ten-green-giants/N6>
Panasonic

7.    <http://www.greentechmedia.com/articles/read/top-ten-green-giants/N7>
Johnson Controls and Honeywell

8.    <http://www.greentechmedia.com/articles/read/top-ten-green-giants/N8>
Wal-Mart

9.    <http://www.greentechmedia.com/articles/read/top-ten-green-giants/N9>
Veolia

10.
<http://www.greentechmedia.com/articles/read/top-ten-green-giants/N10> Cisco

Honorable mentions: Philips (lighting, electronics), Samsung (electronics,
aims to be biggest solar maker by 2015), LG (whatever Samsung does, we will
do too) Ford, Schneider (grid, green data centers), IBM (consulting and
technology for water, grid, data centers and supply chain), Oracle, SAP
(software, rampant acquirers), Chevron (oil, solar) Suntech, SunPower, First
Solar (solar), Bechtel, Lockheed Martin, and Boeing (contractors, project
managers).

1. Communist Party of the People's Republic of China

What isn't China doing? The country has kicked off at least 13 electric car
trials, issued somewhat strict gas mileage standards for cars, and set
aggressive renewable energy standards. The Chinese government will invest an
estimated $300 billion in green stimulus over the next decade or so, and
assist the effort by direct investments in companies through its estimated
$200 billion sovereign wealth fund.

Just as importantly, the government is encouraging state-owned banks and
manufacturers (as well as private companies) to
<http://www.greentechmedia.com/articles/read/is-alternative-energy-chinas-pa
th-to-a-brand/> collaborate with Westerners. First Solar will build power
plants in China and provide Chinese utilities with the know-how to build
them on their own, while Intel and IBM are working with state grid
companies. 

Exports will climb, too.
<http://www.greentechmedia.com/articles/read/chinese-company-to-build-solar-
power-plants-in-u.s.-with-duke/> Duke and Chinese conglomerate ENN will
build and manage alternative energy power plants in the U.S. Meanwhile,
Chinese wind power turbine maker A-Power Technologies will build a massive
1.6 GW power plant in Texas and
<http://www.greentechmedia.com/articles/read/chinese-wind-power-group-to-put
-its-factory-in-nevada/> a turbine factory in Nevada with financing from a
Chinese bank. And electric car makers BYD and Coda Automotive want to bring
cars made on Chinese assembly lines to the U.S.

Japanese companies established worldwide brands with cars and TVs. China
will do the same with energy.
<http://www.greentechmedia.com/articles/read/will-your-next-employer-come-fr
om-china/> Your next job might be with a Chinese conglomerate. 

Other governments -- Germany, Spain, the U.S., California -- have set up
stimulus programs, too, but the one-party government and state-owned status
of many companies and banks (Coda will make its car on lines in a
state-owned factory and funding for its battery venture comes from a state
bank) put the PRC in the category of a market participant.

2. General Electric

No surprise here. In its second century of operation, GE remains one of the
dominant forces in energy. It jousts with Vestas for the top spot in wind,
is trying to establish WiMax as a standard for grid communications, and its
oil and gas unit has a $400 million contract to provide compression
equipment and services to the world's biggest carbon capture project. Last
May, GE unfurled a plan to start producing
<http://www.greentechmedia.com/articles/read/ge-aims-at-energy-storage-for-t
rains-grid-4604/> sodium batteries for trains and the grid, giving Japan's
NGK Insulators its first major competitor.

Recently, it said it would
<http://www.greentechmedia.com/articles/read/ges-secret-sauce-in-solar-x-ray
-systems-and-oled-lights/> re-enter the market for solar panels in 2011 with
cadmium telluride solar panels that will set a new efficiency standard. The
announcement marked the first challenge from a major player for First Solar
in a while.
<http://www.greentechmedia.com/articles/read/ge-trots-out-the-led-bulb-for-h
omes/> LED light bulbs come out later this year. OLEDs? Hopefully soon. 

This energy behemoth has also devised an electronic home strategy so that
all of your GE appliances will link smoothly into demand response and smart
grid services.
<http://www.greentechmedia.com/articles/read/a-chat-with-the-man-who-will-ke
ep-smart-grid-on-track/> John McDonald, the chair of the Smart Grid
Interoperability Panel Governing Board at the National Institute of
Standards and Technology (NIST) will oversee home grid standards. He came
from GE.

3. Siemens

<http://www.greentechmedia.com/articles/read/the-top-ten-acquirers-in-green-
tech/> GE with a German accent. The two focus in many ways on the same
markets. In 2009, Siemens' environmental portfolio generated $23 billion
euros in revenue, an 11 percent increase. The conglomerate seems be a little
more active than GE when it comes to acquisitions lately. Siemens spent $418
million in 2009 to acquire Solel, which builds solar thermal power plants
and said in December that it wants to be a top-three supplier of wind
equipment by 2012. In the past, it scooped up a number of water companies.
It also has investments in startups like Energy4U and Israel's Arava Energy.

If there's a big project in the world, like the massive
<http://www.desertec.org/en/concept/summary/?gclid=COm3opTJh6ECFRVabQod9Qh-R
A> Desertec project that will harness North African sun for power for
Europe, Siemens will invariably be involved.

4. Nissan

Back in 2007, when Nissan was a distant third among Japanese car makers,
<http://news.cnet.com/8301-10784_3-9790232-7.html?tag=mncol> Minoru
Shinohara, who runs the company's technology division, told me that Nissan
would largely skip over hybrids and start producing
<http://www.greentechmedia.com/articles/read/the-hidden-player-in-electric-c
ars/> all-electric commuter cars in 2011 or 2012. It sounded intriguing, but
he was a lab exec, after all. Were the higher-ups listening?

Apparently so. Renault Nissan announced a push into electric cars a few
months later. Perhaps the most surprising part, however, is that Nissan has
kept on track. The Leaf will make its debut later this year at a price,
$32,800, which will make it comparable or cheaper than equivalent
gas-powered cars after tax credits.

More electric cars -- all equipped with the lithium polymer battery
developed in conjunction with NEC -- will spill out in 2011 and 2012. The
Leaf brought much-needed credibility to electric cars.

Along the way, Nissan has also been a boon to charging station and electric
car service providers: it has alliances with nearly all the major players
(Better Place, Ecotality, eTec, etc.). Arguably, Ford -- which is coming out
with all-electrics, plug-in hybrids, and a series of energy-efficient
EcoBoost engines -- belongs here instead, but Nissan has in many ways been
the biggest champion of electric vehicles.

5. Dow Chemical

The chemical giant, founded when William McKinley sat in the White House
(1897), has embarked upon a multi-pronged strategy to exploit its know-how
in membranes, coatings and material science to reduce the amount of fossil
fuels consumed by others in manufacturing their own products. Think of it as
invisible green.

Last September, Dow Corning, a joint venture between Dow and Corning,
brought a silicone sealant originally devised for outer-space solar panels
to the conventional solar panel market. Silicone protects better than
standard coatings, the company said, but also
<http://www.greentechmedia.com/green-light/post/why-silicone-for-solar-a-mod
ule-off-the-line-every-90-seconds/> increases factory output. In November,
Dow signed a multimillion dollar, multi-year research alliance with
<http://www.greentechmedia.com/green-light/post/dow-lines-up-with-caltech-fo
r-next-gen-solar/> Caltech to develop next-generation solar technologies.

This year, the company will sell
<http://www.greentechmedia.com/articles/read/dow-to-roofers-our-solar-shingl
es-are-coming/> copper indium gallium selenide (CIGS) solar roofing tiles.
Initial customers for the tiles, developed in conjunction with Global Solar,
include
<http://www.greentechmedia.com/articles/read/dow-to-roofers-our-solar-shingl
es-are-coming/> mass market home builders Lennar and Pulte Homes. It also
has an investment in small CIGS developer NuvoSun, which was founded by
Miasole founder Dave Pearce.

Meanwhile, Dow Kokam, a joint venture, makes batteries for electric cars.
Water is also on Dow's ambitious agenda: it bought Rohm and Haas to expand
into desalination.

6. Panasonic

When Fumio Ohtsubo, who runs the Panasonic conglomerate, announced that
<http://www.greentechmedia.com/green-light/post/told-you-so-panasonic-to-inv
est-1b-in-greentech/> the company would invest $1 billion into expanding its
green market, it was less a breakthrough than a coup de grace.

Panasonic has been building its green portfolio for years. The company makes
the nickel batteries for the Toyota Prius and the lithium ion batteries for
the Tesla Roadster. Last year, it started selling
<http://www.greentechmedia.com/articles/read/why-fuel-cells-make-sense/>
home fuel cells though local utility Osaka Gas that turn methane into
electricity. And, like a lot of TV manufacturers, it has begun to tout
energy efficiency as a selling point in its TVs. Some of its plasma TVs
consume only
<http://www.greentechmedia.com/articles/read/next-week-a-huge-fight-over-tv/
> 142 watts, explained Pete Fannon, vice president of technology, policy and
government regulation at Panasonic.

The company also has plans to release a
<http://www.greentechmedia.com/green-light/post/led-bulbs-drop-in-price-by-5
0-percent-why/> LED light bulb that costs $40, consumes about 7 watts, and
emits as much light as a 60-watt incandescent. Panasonic also participates
in electronics recycling facilities and is a member of a number of smart
grid panels in the U.S.

Last year, in a move geared to let it get into solar panels and beef up its
battery portfolio, the company bought a controlling interest in Sanyo, which
was started in the first half of the 20thcentury by one of Panasonic's early
employees.  The company is also working with a number of Japanese companies
on smart grid trials in Los Alamos, New Mexico.

The next push? Homes. The company has a construction unit that can produce
modular homes complete with energy efficient washing machines, TVs, new
forms of insulation, standby lithium battery packs, solar panels and passive
air conditioners from various divisions in the company itself. (See the
video). It helps to have thousands of engineers and lots of factories at
your disposal.

The big question mark is how aggressive Panasonic will be. Like many
Japanese conglomerates, the company has been somewhat skittish about taking
some of its domestic products overseas. I asked Ohtsubo about the company's
green home plans in 2007. Japan, and maybe Europe, he said. Whether you see
the blue Panasonic label all over the place again, or whether most of this
stuff says in trade show purgatory will become one of the more interesting
issues in the green consumer market.

7. Johnson Controls and Honeywell

Yes, it's cheating to declare a tie, but these two companies are mentioned
in tandem quite a bit. In fact, I can't think of the last time someone
mentioned Johnson Controls without adding "...and Honeywell" and vice versa.

The two companies are primarily known for
<http://www.greentechmedia.com/green-light/post/johnson-controls-whats-hot-i
n-green-building/> building management systems, a growing market that will
likely undergo a rapid evolutionary spurt, but they have other interests,
too.
<http://www.greentechmedia.com/articles/read/uop-an-unlikely-cleantech-leade
r/> Honeywell is the parent of UOP, which is leading the charge in
developing catalysts required to transform feedstocks into "drop in" fuels
like renewable diesel, jet fuel, and gasoline that require no changes to
fuel infrastructure or fleet engines.

Johnson, meanwhile, is participating on the retrofit of the Empire State
Building, while its battery group received $299 million from the DOE to
develop nickel cobalt batteries for hybrids. The joint venture Johnson
Controls-Saft makes lithium ion batteries for Ford.

The company also likes solar steam. "It is about a 40 percent efficient
process. Solar thermal has advantages we need to capitalize on," Don
Albinger, vice president of renewable energy solutions, told us last year.

Another interesting, and ancient, company that will loom large in green
building: Alcoa.

8. Wal-Mart

Wal-Mart plays three roles in the green industry. As the world's largest
retailer, it is both a buyer and seller, a consumer and provider, of goods.
Its sprawling real estate holdings make it one of the richest targets for
reducing energy consumed in operations.

The sheer size of the company makes almost anything it does noteworthy.
Earlier this year, it launched a plan with the Environmental Defense Fund to
help its suppliers reduce packaging and their own energy consumption.
<http://www.greentechmedia.com/articles/read/the-green-supply-chain-challeng
e/> Streamlining undertaken at Wal-Mart's behest, of course, will invariably
lead to lower-carbon products at other stores. Roughly 30,000 factories in
China will be affected.

The company will also begin to put tags on its own brand-name clothes
telling consumers that they can be washed in cold water, thereby saving
downstream energy. Locavores have cheered the programs the discount giant
has put in place to encourage farming in close proximity to its superstores.

Inside stores, experiments with LED lights in freezer cases, solar panels,
fuel cells and other technologies move relatively quickly from prototype
installations to commercial practices. The little things add up. Taking the
lights out of soda machines in break rooms cut $1 million from operating
costs.

9. Veolia

Veolia shares three distinct characteristics with many other companies on
this list. One, it's old,
<http://www.veolia.com/en/group/history/1853-1900/> founded in 1853 to
provide irrigation services. Two, it's not based in the U.S. -- Veolia hails
from France. And three, it pulls in a tremendous amount of revenue ($50
billion euros annually) providing relatively anonymous, arguably dull
services that modern civilization can't live without.

Veolia, in fact, could be considered the king of unsexy green. The company
has four lines of business: public transportation, water treatment, heating
and cooling and garbage. Ever take the SuperShuttle to the airport? Veolia
owns that. Roughly 75 percent of its revenue derives from providing services
to public agencies and government.

The trust that governments are willing to give the conglomerate, however,
explains its inclusion on the list. For the foreseeable future, governments
will remain some of the largest consumers of green technology and services.
Homeowners might own their own solar panels to get off the grid, but don't
expect to see an explosion of eco-friendly home sewage systems anytime soon.
Like GE and Siemens, Veolia has something of a free pass when it comes to
the initial stages of due diligence.

Earlier this year, the company has created an
<http://www.greentechmedia.com/articles/read/french-giant-veolia-creates-pro
gram-to-team-with-start-ups/> accelerator program to recruit startups to
participate in live prototype projects. It is working with NanoH2O, a
company that has devised an energy-efficient desalination membrane, and
Veolia wants to find a trash company to help it separate recyclable metals
in waste streams.

"What we can provide is the customer base and pilot capabilities," said
Philippe Martin, senior vice president of Veolia Environement.

10. Cisco

More of a potential giant than an actual one -- yet. The networking king
unfurled its EnergyWise platform last year to
<http://www.greentechmedia.com/articles/read/cisco-jumps-into-energy-managem
ent-for-computers-buildings-5585/> reduce the energy consumed by PCs,
networking equipment, and phones. Ultimately, Cisco wants to manage energy
in buildings. It has already bought Richards-Zeta Building Intelligence to
expand in that market. It has also entered into a few smart grid projects
and plunked an
<http://www.greentechmedia.com/articles/read/cisco-invests-in-grid-net/>
investment into Grid Net, the broadband smart grid provider.

Another market: videoconferencing and
<http://www.greentechmedia.com/green-light/post/cisco-expands-push-into-city
-planning-with-sf-agreement/> city planning. Cisco cut its own travel budget
by $500 million using video.

Granted, that pales in comparison to what others on the list have
accomplished. Even Silver Spring is still a bigger name in smart grid.
Nonetheless, two factors make Cisco a threat. One, it has a somewhat strong
history of acquiring companies and then actually exploiting their technology
in their own products. (That flip camera one notwithstanding.) With a market
that will see a tremendous amount of M&A activity, this is a subterranean
skill.

Two, smart grid is all about networking and Cisco has quite a bit of
expertise here. Still, we'll have to wait and see. Various IT companies have
laid plans to expand from their core markets and never quite succeeded. Only
time will tell on this one.

Rick Thompson, Co-Founder and President of Greentech Media, contributed to
this article.

 

Eric D. Schwerin

Rosemont Seneca Partners, LLC

1010 Wisconsin Ave., NW

Suite 705

Washington, DC 20007

(202) 333-1880

[email-masked] <x-msg://59/[email-masked]> 

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