ClearEdge Power Fueling Growth with VC Funding

ClearEdge's box is actually a fuel cell that can cleanly convert natural gas to power for small commercial buildings and even homes.

Image: ClearEdge

Fuel cell maker ClearEdge Power has hauled in $73.5 million in funding from Artis Capital Management, Austria-based Gussing Renewable Energy; Southern California Gas Company, a subsidiary of Sempra Energy; and existing investor Kohlberg Ventures; to grow its business both at home and abroad.

"This new investment provides the capital necessary for ClearEdge Power to build on our already strong foundation by entering new markets, advancing our technology and commercializing new products," CEO Russell Ford of the Hillsboro, Oregon, company said in a release.

Fuel cells are used to convert energy from hydrogen or natural gas or other fuel into electricity, and can cut the greenhouse gasses emitted in the process, and this investment, as Todd Woody points out in Forbes, represents a kind of coming-of-age for an industry that has long been a major focus for advocates of clean energy.

The sector is projected to sell 1.2 million units by 2017, according to Pike Research, and has grown 27 percent compounded annually from 2008-2010.

Bloom Energy, a rival of ClearEdge’s, has raised more than $400 million and has introduced large fuel cells called Bloom Boxes that it has sold to customers like Adobe, eBay and Wal-Mart, which all have big energy needs and the cash to pay $700,000 to $800,000 for Bloom’s contraptions.

But ClearEdge does things on a different scale. Rather than build them big, it has opted to make fuel cells the size of a refrigerator that converts natural gas to electricity. In designing an energy solution for smaller office buildings or even homes, the company has been able to price its units at a relatively more affordable $56,000.

Kerry-Anne Adamson said such differentiation is key as the industry begins to take off. “The fuel cell industry is reaching an important tipping point and over the next 18 months a clear gap will begin to emerge between companies that have strong products and clearly defined markets and those that do not.”

Get more business intelligence from Portfolio.com:

• HP's Desktop Flip-Flop: Looks like Hewlett-Packard's desktop unit missed the news last week that the company is planning to ditch the personal-computer business.
• The World Under Gaddafi: In 1969, Muammar Gaddafi rose to power as president of Libya. He was 27. Nearly 42 years later, rebel forces have all but forced him out of office. The world is a vastly different place since he began his reign.
• The Tab Ten: The tablet market exploded out of the gate, and experts predict demand for these sleek, sexy gadgets will only pick up speed.