Kleiner makes India cleantech investment

Kleiner Perkins Caufield & Byers recently made its first cleantech-related investment in India, a top executive told Reuters.

Speaking at the Reuters Global Environment Summit in San Francisco last week, Kleiner Perkins Partner Ajit Nazre said that the firm has invested in an energy company in India. He did not disclose further details.

“It’s in the business of producing electricity from cleaner sources,” Nazre said. The company is working on projects that could produce up to 5 megawatts of power, he added.

Nazre, who joined Kleiner in 2003 and focuses on the firm’s alternative energy and India investments, said he is bullish on making cleantech investments in the South Asian country.

Kleiner has investments in Indian consumer Internet companies, and said last year it was exploring “cleantech” investments in India. In April, Kleiner Perkins raised a $500 million Green Growth Fund.

Venture investment in India by U.S. venture capitalists declined significantly in the third quarter, falling to $271 million, a 43% drop from the second quarter, according to the MoneyTree Report from PricewaterhouseCoopers (PWC) and the National Venture Capital Association (NVCA), based on data from Thomson Reuters (publisher of PE Week).

“The country is starved for energy,” Nazre said. India will have a shortfall of 50 gigawatts of electricity by 2012, given the current installed power capacity and its 7% annual growth rate, he added.

The unmet need creates an opportunity for investments in clean energy as India leapfrogs from not having enough power to getting it from next-generation, environmentally friendly technologies, Nazre said.

He likened it to India’s wireless revolution, where mobile telephones have filled India’s yawning gaps in fixed-line connectivity.

Kleiner Perkins is also looking at investing in technologies that help improve clean water resources and generate electricity from biomass and water in India.

But energy efficiency, a category that has seen a healthy dose of venture capital dollars in the United States, is unlikely to see similar investment levels in India, Nazre said.

“India has to get a grid, let alone a smart grid,” Nazre said, referring to the country’s inadequate electricity infrastructure. Smart grids use technology to cut power transmission and distribution losses, and help utilities become more efficient. —Anupreeta Das, Reuters