China ups ante on carbon emissions with new Picarro contract

Picarro, maker of a system that measures the amount of greenhouse gases in the atmosphere to a surprisingly accurate degree, has landed a major contract to provide the China Meteorological Administration (CMA) with twice the number of systems as expected.

The deal is big news for two reasons. First, it’s one of the biggest orders Picarro has won, initiating it and the bold concept behind its business into the cleantech mainstream. Second, and more importantly, it suggests that China is getting more serious about making changes in its carbon emissions practices and policies. Installing this many atmosphere analyzers will drastically improve China’s methods for monitoring its atmosphere.

Picarro announced the contract at an ideal time — during the first week of the United Nations Climate Conference in Copenhagen, when the world’s eyes are fixed on the greenhouse gas emission issue. Just how many people are paying attention? Google says “Copenhagen” just became its number one search query, trumping second-place “Tiger Woods.”

It’s a good springboard for Picarro to become a major name in carbon measuring and management — it says it’s certainly looking to recruit new customers from the summit’s delegation. It could prove vital to determining whether new national and global policies are actually having an impact.

It’s also a good time for China to be taking visible steps against the global warming trend. Not only is the world community skeptical that the country will do what it takes to reduce carbon emissions, but China also just announced that its emissions will probably peak between 2030 and 2040 — a stat that doesn’t impress.

Not that the country has refused to take action. Last week, the government set a goal to slow the increase of emissions by 40 to 45 percent (from 2005 levels) over the next 10 years. But this target hasn’t won many admirers either, considering that China is still set to increase its carbon dioxide output by 90 percent. Beijing has been very clear: it is committed to growing its economy first, and reducing emissions second.

Regardless, Picarro’s technology seems to be a shift in the right direction (for the environment, and for China’s image). The deal follows shortly after Picarro was chosen by the World Meteorological Organization to conduct tests at atmospheric monitoring stations around the globe.

Contained in a relatively small box, the Picarro system is unique from similar offerings made by competitors Thermo, Varian and Agilent because it doesn’t depend on external calculations. These other systems rely on signal towers and air sampling, processes that are way more expensive and time consuming than what Picarro has been demonstrated to do.

We reported on the company prior to the GreenBeat 2009 conference, emphasizing how its success could depend on whether the U.S. Congress successfully passes carbon cap-and-trade legislation. In just three weeks, the landscape of the business has changed radically. The Environmental Protection Agency’s recent ruling that greenhouse gases pose a health threat, places regulation in the hands of the executive branch, making cap-and-trade more likely. On top of that, if Picarro can grow its international traction — with China as a first, solid foothold — it won’t need to wait for more progressive climate policies in the U.S.

Starting as a spinout from a Stanford University lab, Picarro initially developed lasers for the telecom industry. But in the last two years, it has redefined itself to ride the climate change momentum. So far, it has raised $22 million from Benchmark Capital, Greylock Partners, SkyMoon Ventures, Staenberg Venture Partners and Weston Presidio Capital.