Framework for Clean Technologies in China

Green Drinks

August 2011

Dr. Patrick Berbon

Framework for clean technologies in China

Looking to invest in teams with solutions

California Clean Technologies, San Francisco, California, and China Materialia, Shanghai, China

China Materialia (遨问遨问遨问遨问)

Shanghai and Wuxi, China

Dr. Patrick Berbon

Engineering degree Ecole Centrale Lyon,


Engineering degree Ecole Centrale Lyon, France, Tsinghua University, Beijing, China

Ph.D. Materials Science, USC, Los Angeles

Aerospace research Rockwell

Start-up in Nanotechnology

Technology Transfer / Innovation / Performance Improvement

Clean Technologies

Shanghai and Wuxi, China

Successful Implementations

• Acid Rains （酸雨）• Hybrid electric vehicles

（混合动力车）


Acid Rains and Catalytic Converters (酸雨和催化转换器)

Mainly sulfonic acid and nitric acid formed when sulfur dioxide (SO2) and nitrogen oxides (NOx) react with water and oxygen in the atmosphere.

These pollutants come from primarily manmade activities: burning of fossil fuels for cars, power plants and buildings. The issue was tackled by using catalytic converters in cars and scrubbers in power plants.

Acid rains were critical to build awareness to environmental damage done by population growth and un-checked industrial production. EPA regulations under the Clean Air Act.


Hybrid vehicles (混合动力车)

Fastest growing segment of US vehicle market;

Toyota and Honda have taken an early lead. US manufacturers working hard to catch up (on Your dime);

Note that the 800K Toyota Prius in the US save about 2.3M tons CO2 / year, equivalent to ONE coal plant!

“Some firms, in the process of addressing climate change, will find opportunities to enhance or


change, will find opportunities to enhance or extend their competitive positioning by creating products (such as hybrid cars) that exploit climate-induced demand”, Michael Porter and Forest Reinhart, “A Strategic Approach to Climate”, Harvard Business Review, October 2007.

The Honda Civic Hybrid engine features i-

VTEC and IMA (integrated motor assist)

technology, enabling electric motor run.

Presented by Honda Motor Senior Managing

Director Motoatsu Shiraishi.

China Materialia is a Shanghai-based Venture Capital Investment and Innovation Advisory Company

Advisory

Venture Capital

Investment

Venture Capital


Venture incubation

Shanghai YangpuInternational Technology

Transfer Incubation Center

China Materialia Venture Capital Fund is dedicated to helping foreign companies to grow in China market

� 150 million RMB (~ $23 million), $ 2-3 million per investment

� At least 50% of the Fund will invest in Sino-foreign joint-ventures with international technology companies

� Core industry focus

� Advanced materials and enabled applications


� Clean-tech/Energy

� Electronics and controls

� Medical devices

Why you would be interested in China – lower cost, bigger market, more capital

Technology content

Cost of Maximize Value

Availability of capital


Cost of commercialization

Market potential

Maximize Value

of

Innovation

Clean Energy Limitations – Policy Decisions / Economic factors（局限性－政策规定／经济因素）• Need adoption of international conventions;

• Entrenched large businesses and government administrations;

• Complexity of Intellectual Property positions as many new clean technologies are at the cross-roads of various


new clean technologies are at the cross-roads of various technological fields;

• Renewable energy projects require large capital expenditures (pay for fuel upfront);

• Investors not yet convinced of good ROI;

Marginal Cost of Abatement（减少的边际成本）


Marginal Cost of Abatement（减少的边际成本）

€/t CO2

Cum Gt CO2 eliminated

Fridges / freezers

-100

-50

0

50

0.50 1.51.0 2.0 2.5 3.0 3.5 4.0

Appliances

Retrofit facade


Windows

Washers/ dryers

New-build insulation

Building envelope

Retrofit floor/ roof

Lighting

Retrofit floor/roof

Other appliances

Heaters

Water heatingA/C

-200

-150

Appliances

…many are green building materials & technologies

(slide from Marc Porat, investor, California)

International agreement – Fundamental issue

COP 16: ONE FUNDAMENTAL ISSUE

US 20 tons CO2 / year / person

China 1 ton CO2 / year / person


World emitters: Everyone!

US and Germany due to energy intensity, China and India due to size of population, Russia due to oil and gas, Brazil and Indonesia due to burning of the rain forest.


Fuel Mix for Electricity Generation in the US in 2007（２００７年美国发电的类型）


Total generation 4,200 BkWh (AIE Outlook)

Fuel Mix for Electricity Generation in China in 2007（２００７年中国发电类型）


Total generation 3,042 BkWh (source: US EIA)

Fuel Mix for Electricity Generation in the World 2006（２００６年全球发电类型）


Total generation 18,930 BkWh (source: IEA)

Fundamental Opportunity – Green Jobs（清洁能源的机会－绿色工作）“Some firms, in the process of addressing climate change, will find opportunities to enhance or extend their competitive positioning by creating products (such as hybrid cars) that exploit climate-induced demand”, Michael Porter (2007).


Thomas L. Friedman, NY Times foreign affairs columnist, “Mr. Conventional Wisdom”, author of “The World is Flat” (2005) and “Hot, Flat, and Crowded” (2008).

President Barack Obama speeches and stimulus package (2008 and 2009).

Your Opportunity – You (你的机会 -你自己)

• LOTS OF opportunities;

• HUGE opportunities;

• Position YOURSELF;

• Vinod Khosla: “This is bigger than the internet”


• Mark Porat: “Of the next 10 Google, 8 will be in cleantech”

We look for technology solutions to large pain-points in the marketplace, coming with a solid team and a business model

Technology SOLUTIONS

LARGE pain-point in the

marketplace in China

Target

� Market Pain

� Validated market opportunity

� Growing at > 30%/yr in China

�Technology Solution

� Technology solution


Profittable, Capital efficient, Return

potential

Target projects

� Technology solution

� Beyond proof-of-concept and beyond small-scale trial

�Business model

� Business model showing you can solve the problem at a profit

� < $2 M to reach significant milestones and first sale

What we would like to see in your proposal

• ProblemWhat is customer pain that your technology addresses Outline how the customer addresses the issue today

• SolutionDescribe your technology and your products line-upDescribe your IPDemonstrate your value proposition to the customersDemonstrate your value proposition to the customersYour product development roadmap

• Market SizeIdentify/profile the customer you cater toEstimate of market size and what do you believe as market potentiaal

• CompetitionList competitorsList competitive advantages of your technology and products

• Why NowSet-up the historical evolution of your categoryDefine recent trends that make your solution possible

• Business ModelRevenue modelPricingAverage account size and/or lifetime value

What we would like to see in your proposal

Average account size and/or lifetime valueSales & distribution modelCustomer/pipeline list

• TeamFounders & Management for US company and for the Chinese entityBoard of Directors/Board of Advisors

Your Opportunity – The Future is Here（机会－未来就在这里）

• 4/2009: Abengoa Solar puts the largest Concentrated Solar Tower into operation near Seville, Spain;

• Meet the PS20: 20 MW, 1,255 heliostats, 531 ft tower;


Merci pour votre attention. Thank You for your attention. 谢谢大家.


Dr. Patrick Berbon

187-6262-4010 (China)