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A few years ago, it was still a subject of regular outrage. Jobs were headed to Mexico. Factories moving to China. Everybody hated globalization, without quite understanding it. But with a flood of news coverage — the slightly nauseating peak being an all-too-popular book about the world being flat — people finally figured it out: The manufacturing jobs were gone. Get a job banking, or flipping burgers, but don’t expect to be building cars or making clothes.

The idea is that we should switch to a knowledge-based, service-oriented economy. And Silicon Valley, for one, long ago pinned its hopes on brains over brawn. Just take a look at the companies that get funding. But now that everyone’s getting used to the knowledge economy, manufacturing may make its comeback.

Here are the primary factors driving a manufacturing renaissance: The rapid growth of middle class consumers in countries like Brazil, China and India; a shrunken dollar and the loss of economic pre-eminence by the United States; less easy credit for overseas goods for consumers in the US; and, potentially, rising transportation costs that cut into cheap goods sent from overseas.

Those details are outlined by the CEO of the Manufacturers Alliance, Thomas Duesterberg, in this Industry Week article. There are a few more that could be added to the mix, though.

The first is our bid at shifting energy usage at home off foreign oil. Companies like Ausra, Nanosolar and Tesla are basing not only their research, but their plants in the United States. They have plenty of reasons to do so. States, eager to win back jobs lost long ago, are offering hefty incentives. Materials like solar mirrors and wind turbines are expensive to ship, and solar panels often break during long voyages. And for Tesla, there’s an additional prestige to having a car manufactured in the U.S., even if some parts are made overseas.

Another good example is Infinia, a solar company that is reducing its own startup costs by using existing manufacturing capacity in the country, much of which has been idle for years, to builds its solar dishes. And finally there are the many biofuel startups, many of which have no choice but to place their plants near the sources for their fuel. As the market for renewables grows, more will certainly be built here.

The need for specialized work will also become more prominent with the rise of next-generation materials, especially nanomaterials. Although fabless manufacturing in the semiconductor industry proved that high-tech work can be done overseas, the first generation of manufacturing will be at home. And with costs for overseas labor rising, the new nano industry may choose not to move elsewhere.

There are also opportunities for less commercial production. As the online marketplace Etsy has shown, there’s a nascent industry of crafters who are are eager to sell their goods. Ponoko, for one, wants to help those people create their goods, with online tools and a relatively inexpensive production process based on laser cutters.

And for the professionals, the small design firms and build shops of the world, cheap rapid prototyping and rapid manufacturing technology are on the rise, a subject that I wrote about a year ago.

Whether physical production can ever dominate the American landscape again is doubtful. But the conventional view into the future, which suggests that we’ll make our way as a pure knowledge economy, is likely also off the mark. The future is never quite what you expect.

BrightSource Energy, an Oakland, Calif., solar thermal startup, has landed a hefty $115 million funding round from investors including Google to develop its solar power tower technology.

Solar thermal technology is one the leading hopes for alternative energy. It uses like mirrors and lenses to boil water, the steam of which is harnessed to generate electricity.

This third round was led by Google.org, VantagePoint Venture Partners, BP Alternative Energy, Statoil Hydro Venture and Black River; returning investors included DBL Investors, Draper Fischer Jurvetson and Chevron Technology Ventures. The company has now raised $160 million.

The company recently signed a massive contract with PG&E to supply it with up to 900 megawatts from its plants, whose construction will begin in 2009. Its Distributed Power Tower (DPT) technology is basically an array consisting of thousands of small mirrors, called heliostats, which concentrate sunlight on a single point — in this case, a boiler chamber mounted on top of the tower. Because its heliostats are able to follow the sun in two dimensions, BrightSource claims they are much more efficient than rival solar thermal technologies.

Each field of heliostats, dubbed a Solar Power Cluster (SPC), can produce 20 MW of solar power; a typical BrightSource power plant, made up of five SPCs, is therefore capable of generating up to 100 MW. To reach the 900 MW mark, the company plans on having one 100 MW plant up and running by 2011 and four 200 MW plants up by 2016.

Rivals Ausra, Solel and eSolar use similar technologies to produce electricity, though their specific designs differ. The latter, for example, uses flat mirrors in smaller groupings to produce up to 33 MW at a time –a practical strategy that allows the firm to plug directly into the existing grid and to eschew the burdensome process of obtaining permits. Costs will likely remain the biggest obstacle for these companies, but BrightSource, which is chaired by Arnold Goldman, a man with an extensive background in solar thermal, will be well positioned to handle them.

[See also: CNET Green Tech Blog

1. Funny or Die raises $15M, despite chance of latter
2. Did White House lead rejection of California’s emissions claims?
3. Redhat CEO Matthew Szulik resigns
4. Startup.com’s Tuzman to save Roo.com
5. Netsuite’s stock soars past $35
6. Cisco’s Charles Giancarlo, leaves to Silver Lake Partners
7. Jacked, online sports service, raises $6.5M
8. Top 10 Seattle-area tech stories of the year
9. Miasole reportedly lays off 40 workers
10. Ausra’s proposed 177MW plant is approved

Funny or Die raises $15M, despite strong chance of latter — Being funny is hard, but Will Ferrell made his career from it. That’s probably why Sequoia Capital and others have trusted Funny or Die, a startup project between himself and co-founder Adam McKay, with another $15 million. Here’s the problem: With 30 writers and only one big hit (The Landlord), we’re not so sure that “Funny” is a strong enough business plan to nurture this particular web baby. Portfolio has the full story.

Did White House lead denial of California’s right to regulate greenhouse emissions? — See here.

Redhat CEO Matthew Szulik resigns, replaced by Jim Whitehurst, former COO of Delta Airlines — CNET reports.

Online video company Roo.com lays off fifth of staff, and now appoints Kaleil Tuzman to take over — Roo was accused of mismanagement, board members were forced out, and an executive was indicted for money laundering and felony. Now Tuzman, the former CEO of the bubble era GovWorks.com, who was embodiment of excess during the Internet bubble, as captured in the documentary Startup.com, has taken over.

Netsuite’s stock opens $26, and roars past $35 on first day of trading — The company is now valued at $2.1 billion. Oracle CEO Larry Ellison and his family own more than 70 percent of that.

Cisco Systems’s number two, Charles Giancarlo, leaves to Silicon Valley private equity firm, Silver Lake Partners — He was the heir-apparent to Chairman and CEO John Chambers, and he helped manage some important mergers, such as WebEx, and put in 14 years of service. But with Chambers set to stay between three and five more years, Giancarlo’s itch finally got too great. “I went home one day and talked to my wife and said, ‘Honey, I now know what you mean by a biological clock.’” In February, Cisco also lost Mike Volpi, another senior executive, who left to to join a start-up. (Forbes has details.)

Jacked, a service that runs stats, news and photos beside online sports programming, raises $6.5M — The Santa Monica, Calif. company’s first round was led by Core Capital Partners and Gabriel Venture Partners, with participation from Provenance Ventures. It announced a deal to provide its service on NBCSports.com

The top 10 Seattle-area tech stories of the year – Seattle Post-Intelligencer reporter John Cook keeps a close eye on his city, and he’s assembled a list of the area’s top 10 stories of the year. Included are briefs on the area’s year in venture funding (the best since the dotcom bubble), strong results by Clearwire and Imperium Renewables, retreats from Jobster and Isilon, and more.

Miasole reportedly lays off 40 workers — Three disgruntled ex-employees revealed to VentureWire that solar CIGS maker Miasole recently laid off 40 of its staff. The story isn’t new, though; Back in October, CNET floated the same rumor, only to be told by Miasole CEO David Pearce that it was just a few contractors. The company itself isn’t currently responding to inquiries about the layoffs.

Ausra’s proposed 177MW plant is approved — We reported a month ago that solar thermal company Ausra is planning a 177 megawatt generation plant in California’s San Luis Obispo county, but the tricky hurdle of gaining regulatory approval for the plans remained. The bureaucrats have now given it a thumbs-up.

Ausra, the Palo Alto-based solar thermal company that just last month announced plans to build a 177-megawatt solar installation in California, is now in the process of launching a new business arm, mass producing its own flat-mirrored solar collectors.

It’s begun construction on a Las Vegas facility that it says will churn out enough solar collectors each year to produce 700 megawatts of energy. And the construction’s not moving slowly: Ausra plans to have the 130,000 square foot plant completed as early as April 2008.

Solar thermal works by reflecting light onto tubes of water to generate steam. Industry insiders have been saying for decades that solar thermal units, if they can be produced at large scale, are cost-competitive with electricity produced by gas-fired plants.

The sheer size of the plant, which will produce enough collectors to generate 700 megawatts of energy each year, should help with that. By running a mechanical production line, much like a car factory (a robot from the line is pictured below), Ausra expects its new Las Vegas plant to run with just 50 permanent employees.

Ausra’s probably not the only company moving into large-scale production. Competitors like Brightsource and Solel likely have plans to launch similar efforts, although nothing has been announced yet.

And this leads us to some of the risks Ausra might face once its new plant is up and running: Other well funded companies, including foreign giants like Spain’s Abengoa, could flood the market with their own solar thermal concentrators. Even if they don’t, a drop in prices for other sources of energy could result in the company finding itself stuck with more capacity than demand for its collectors.

And from a liquidity angle, Ausra needs plenty of interested investors. The $40 million funding round it took earlier this year will get the company started, but it needs to raise much more for its physical plants — about $500 million alone for the San Luis Obispo electricity generation plant, according to a company spokesperson, with banks, utilities and private equity as the most likely sources. They aren’t disclosing how much the Nevada facility will cost, but said they aren’t planning on taking another venture round for about a year.

On the other hand, if Ausra’s foray into large-scale production proves a success and it wants to further scale up production, it may run into some other, unrelated hitches. Recent reports indicate that the steam turbines used by solar thermal facilities, in many cases the same ones that go into coal-fired plants, are in short supply.

As in the case of wind power, which has run into obstacles with the turbine supply, slow movement in one part of the chain could moderate the pace of growth, at least in the short term.

Risks aside, this is one of the biggest moves yet in solar. Below is the site of the future California generation plant.

updated
California energy utility PG&E has agreed to buy power from a 177-megawatt solar thermal plant to be built by Silicon Valley company Ausra.

Ausra, of Palo Alto, Calif., is applying for a regulatory permit to build on 640 acres of ranch land in California’s San Luis Obispo county.

The idea behind solar thermal power is focusing mirrors on contained water, which then turns to steam that can drive turbines. We last reported on Ausra two months ago, when it raised $40 million from Khosla Ventures and Kleiner Perkins Caufield & Byers.

Ausra’s execution of the deal, if it goes through will help the company catch up with competitor BrightSource, which just cleared the regulatory hurdle for a 400-megawatt plant in the Mojave Desert last week, according to Green Wombat.

Although PG&E has now committed to buying over a gigawatt of solar thermal energy in coming years, it remains to be seen which startup’s designs are most effective.

Technology used by companies like BrightSource and Solel uses special curved mirrors to focus more light, and thus create more steam than Ausra’s plants. However, the latter’s approach, which uses mass-produced flat mirrors, is cheaper, the company says, potentially bringing the cost for solar thermal energy as low as coal-fired plants.

The technology for solar thermal itself has existed for decades. Photovoltaic cells, which directly capture sunlight, may possibly become cheap enough to be a viable replacement.

Ausra, an ambitious Silicon Valley company wanting to build a solar thermal electric power plant double the largest ever built, has raised somewhere north of $40 million in a first round of capital.

However, just as Ausra was preparing to make its announcement Monday that it has applied for a permit to produce a record 175 megawatt plant, its Oakland Calif. competitor, BrightSource, stole some of the thunder late last week by saying it has applied to build a larger, 200 megawatt solar plant and two smaller ones.

The Ausra investment is significant, though, because it’s the largest best so far made by Khosla Ventures, the firm started by successful venture capitalist Vinod Khosla. Khosla has made dozens of investments in the area of green technology, but the size of his bet on this technology reflects his enthusiasm for the Palo Alto, Calif. company, he said. He invested $25 million of the total.

Another top venture firm, Kleiner, Perkins, Caufield & Byers, joined in the investment too.

Solar thermal is different from photovoltaics, the popular technology used for residential solar power. Ausra’s solar thermal technology uses large mirrors, made of steel and glass, to concentrate the sun to heat water into steam. (See Forbes’ explanation of how the two processes are different). Ausra’s process drives a turbine with the steam, to generate electricity. Notably, the energy can be stored in pressurized tanks, so that electricity can be generated day or night. The electricity can also be transported for long distances. In an interview, Khosla and Executive Vice-President John O’Donnell told VentureBeat that if a 92 square mile region of Nevada were covered with the technology, Ausra would be able to fulfill the nation’s entire electricity needs. (They are actually half-serious about this being a possibility, pointing out that much of Nevada’s land is owned by the federal government. Only 10 percent of that land would be needed.)

The technology has been around since the 1990s, when Ausra’s founder David Mills, conceived the idea at Sydney University, and worked on it with scientist Graham Morrison between 1995 and 2001, but Ausra was formed late last year. Khosla and Kleiner Perkins’ Ray Lane met with the company and moved it to the U.S from Australia.

The idea is to help California utilities meet requirements to install 17 gigawatts of clean power by 2020.

Within a year, Ausra will match the price of natural gas plants, which generate electricity at about 9.2 cent per kilowatt hour, O’Donnell said. Within three years, it will match the cost of coal-fired plants, which is about 6 to 8 cents per kilowatt hour (without clean coal processes such as carbon sequestering or gassification). Existing competing solar plants, including one in Nevada, generate electricity at between 16 and 22.4 cents per kilowatt hour.

Among Ausra’s competitors is Brightsource, formerly named Luz II (which we covered here), backed with $30 million from VantagePoint Venture Partners and others. The difference is that Ausra has cut the cost of producing the solar reflecting mirrors — making them on a mass production line, in return for slightly less efficiency, says O’Donnell. (Here’s a Pdf presentation about the company, including a look at its technology.) Ausra said it wants to build a 175 Megawatt plant, more than twice as large as the reigning champ, an 80 megawatt plant in the Mojave desert built in the 1990s.

Other players include France’s Acciona Energy, which recently raised $266 million in debt-and-equity project financing facility to cover the capital costs of constructing a 64-MW solar thermal plant in Nevada (see overview here), and Seville, Spain’s Abengoa Group, which has built a plant in Europe. There are several other smaller players, too.