Cleaner Greener China

Commercializing clean energy
- Moderator: Charles Coey - Managing Partner, Morrison Foerster

Gary Riechel, Qiming Ventures
it is how consumers act that matters more than regulation.

The key to China’s future will be to fund the “right” research

The US needs to get over its protection of IP.
China need to get over local protection, and bring in the best technologies

Hing Wing, Walden International
building boom brings a lot of opportunities - China is a large construction company

mandate that you can no longer use soil for brick - to protect soil / agriculture

Steve Westly, The Westley Group
We are bullish, not because people want to buy green, but becasue there is a confluence of government initiatives

“the future belongs to the creative”

“the question is who will win.. China or the US?”

Hope Chen, DFL China
- has looked at 4000 deals covering cars, battery
- made 3 deals in China - wind and battery

fundamentally it is about clean air, clean water, and energy efficiency

China is about leveraging proven technology + talent pool + commercial applications

06 was a turning point where gov’t began to develop their policies

- Ira Ehrenpreis, Technology Partners

6 drivers:
- government/ politics - one of first driver
- consumers
- diversity of cleantech sector
- corporate seachange - historically ignored by corporations, but now there is
- human capital
- globalization

Moderated Q&A:
1) What is impact of current financial crisis on cleantech
Ira -Drying up of debt markets is a challenge for sector, but an opportunity for countries like China
Steve - there are small deals to be had, so not always need to focus on capital investment
Hing - need to be capital efficient
Hope - foreign firms needs to set up RMB pools to compete

2) What is role of China in innovation
GAry - really depends on the sector (biotech are behind 3 years, but catch up will occur quickly). need local champions. A lot of returning talent from abroad, and corporate partnerships with
Ning- China is laboratory for innovative products. barriers to try are low, and people will try anything. governments will give you land and money if you need it. Low cost are a big advantage
Hope - innovation occurs in many different ways in China. indigenous innovation will come later.

3) sector opportunities
Ning - wind. China is very quikly catching up with the world. up to 20 Chinese firms will have operational units. Using western licensed technologies
Hope - batteries, components, and water treatment
Gary -coal, coal, coal, coal - its 85% of current energy demand, and in 20 years it is still 70%. VC are not going to build coal fire power plants, but there are a lot of companies/ technologies that will surround these plants.
Ira - 75% of all venture dollar to date are solar and biofuels. Wind has been ignored. Storage. grid
Steve - metering equipment

Public Q&A
1) Hurdles to investment
Gary - team. can the team bring the product to market
Steve - is there transparency? too many engineers… no marketing capabilites
Ning - Chinese entrepreneurs are often very practical and want to get to market fast, but they fail to overlook scalability and defendable products

2) will solar implode?
Ning- China became largest panel manufacturer in 3 years, and is rushing into thin film.
Gary - we should learn to celebrate the bubble. Innovation cannot occur in a smooth/ stead process.Innovation does not occur on a schedule.We have to let things die
Ira - we are not in a market bubble. the market is capacity constrained, not market constrained. Solar accounts for .4% of entire energy portfolio

3) IP and IP protection
Gary - if we all collectively agree that this is right for humanity, we need to bend the rules.
Ning - you notice something different in China. All large enterprise when they are large respects IP, and we will start seeing IP becoming real issue once local firms start suing each other.

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