Fitting with the trend toward more capital-efficient investments in cleantech, microinverter maker SolarBridge Technologies raised $15 million in a second round of venture funding today. The company produces a small component of photovoltaic systems, but could make a big difference in how solar is used.
Microinverters convert the direct-current (DC) electricity produced by individual solar modules into alternating-current (AC) electricity, making it compatible with electrical grids. Traditional, centralized inverters pose several problems. Because they aggregate the energy produced by a field of panels, total energy output is lower when just one panel is broken, or even in the shade.
Microinverters ensure that one defunct panel doesn't impact the rest. This allows for panels to easily be upgraded, swapped out or repaired without disrupting whole systems. It also boosts the amount of sunlight converted into energy overall, and reduces the intermittent and unreliable nature of solar power -- one of the major hurdles standing in the way of broad adoption.
Perhaps most compelling, the technology is said to lower the levelized cost of energy (LCOE) generated by solar systems because of higher efficiency, yields and reduced maintenance costs. This kind of product could help major solar manufacturing companies like First Solar and SunPower in a big way (although SolarBridge is not disclosing its current partners), making their products more competitive with fossil fuels.
SolarBridge, an Austin, Tex., company founded in 2004, says the recent round of funding should be enough to break into profitability, according to Greentech Media's interview with CEO Ron Van Dell. It will be used for final product testing, beta installations and, eventually, production.
The company says its microinverters are said to last more than 25 years -- another advantage over central inverters that usually have to be replaced, at a high cost, after a decade or less. To distinguish itself from the competition, it is offering a quarter-century warranty.
SolarBridge is indicative of a trend toward cleantech companies with narrower business models. It's harder than ever for big solar, wind, and even biofuel enterprises to raise hundreds of millions of dollars in capital to support long-term manufacturing strategies. As a result, analysts predict that more startups will find niches within these markets, pursuing quicker M&A exits, or revenue via technology licensing agreements.
The microinverter maker previously raised about $12 million in October 2007. The recent round was led by Rho Ventures, and included existing backer Battery Ventures.