| INDIAN WELLS, California
INDIAN WELLS, California Big-scale renewable
energy projects demonstrating new technologies will have a
harder time getting Wall Street funding due to shaky credit
markets and plunging stock prices, a Morgan Stanley (MS.N)
managing director said on Thursday.
"Right now with the stock market not being its healthiest,
the sort of plain vanilla non-emerging technologies -- those
are the projects that are going to get financed," Aaron
Lubowitz, managing director in Morgan Stanley's global
structured products group, said during a panel at the
Clean-tech Investor Summit in Indian Wells, California.
The alternative energy sector has long had a difficult time
building big projects. The stage between successfully
developing a new technology and amassing scale is often
referred to in the industry as the "Valley of Death," Dan
Reicher, director of climate and energy initiatives for Google
Inc's philanthropic arm said on Wednesday. Google.org aims to
make investments in large-scale renewable projects.
Scott Brown, chief executive of renewable energy private
equity fund New Energy Capital, said it was "very challenging"
for new technologies to gain funding for large-scale projects
without finding ways to minimize the risk a lender takes on.
Brown also said that an economic slowdown significant
enough to depress the growth of electricity demand could impact
growth of the ballooning renewable industry.
Morgan's Lubowitz said there was much more appetite for
small, high-risk technology projects 12 to 24 months ago.
"There is going to be less of that until some of the
regulatory issues get resolved, until the market is a little
bit healthier and until we see some of these credit markets
stabilizing," he said.
On a brighter note, Lubowitz said Wall Street was
optimistic that an extension to federal tax credits for
renewable energy sources would come before they expire at the
end of this year.
"The broad market feels an extension is coming," Lubowitz
said. "People are going about their business as usual... you
can't just stop on a dime. Having said that, if we don't see an
extension by the end of the year, you will see a pullback in
some way shape or form."
(Editing by Gary Hill)