Venture funding in green firms slows in Q3: report

SAN FRANCISCO Fri Oct 1, 2010 3:54pm EDT

A photovoltaic array at the U.S. National Renewable Energy Laboratory's (NREL) National Wind Technology Center (NWTC) generates electricity for the lab on a sunny day near Boulder, Colorado July 21, 2010. REUTERS/Rick Wilking

A photovoltaic array at the U.S. National Renewable Energy Laboratory's (NREL) National Wind Technology Center (NWTC) generates electricity for the lab on a sunny day near Boulder, Colorado July 21, 2010.

Credit: Reuters/Rick Wilking

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SAN FRANCISCO (Reuters) - Venture funding in green technology companies in the third quarter fell 11 percent from a year earlier on concerns over the strength of the global economic recovery, according to a report released on Friday.

Funding was down 30 percent from the second quarter, to $1.53 billion, with a notable pull-back in solar investment, the Cleantech Group said.

The transportation sector led investments during the third quarter, attracting $208 million, followed by biofuel companies with $186 million and smart grid firms with $163 million.

"After record venture capital deployment in (the first half), a continued low volume of exits and doubts resurfacing over the strength and sustainability of the global economic recovery, it is perhaps not surprising that cleantech investment has eased off in the third quarter," said Sheeraz Haji, president of Cleantech Group.

During the quarter, North America accounted for 61 percent of the total funding, Europe and Israel 25 percent, China 10 percent and India 4 percent, according to Cleantech.

The most active venture capital firms in green technology were Silicon Valley fund Draper Fisher Jurvetson, followed by London-based fund Imperial Innovations.

(Reporting by Poornima Gupta; editing by John Wallace)

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