Blackstone joins cleantech gold rush

Private equity and investment advisory giant Blackstone Group has become the investment firm to launch a dedicated cleantech division as it seeks to tap into the booming renewable energy market.

The company said that the new business group will focus on investments in cleantech energy and will also provide advice to clients and the rest of the business on renewable energy strategies across the company’s entire asset base.

The new team is to be led by James D. Kiggen, who previously founded and led a research team focused on emerging sciences and technologies for asset management specialist AllianceBernstein. That team was responsible for investments in a number of cleantech firms, including battery outfit A123Systems and carbon capture specialist Powerspan, and Blackstone is now planning to ramp up its own investments in a number of cleantech sectors.

"Jamie and his team's understanding of rapidly evolving technology applications in solar and wind power generation, carbon sequestration, next generation ethanol, and other renewables will be a key input in Blackstone's investment decisions," confirmed Garrett Moran, senior managing director of The Blackstone Group, adding that the team would also work closely with Blackstone's existing investments in conventional energy firms.

The move is likely to be criticised by some observers as a late attempt to tap into the booming growth being enjoyed by the cleantech market, particularly given that many other private equity and investment firms have had dedicated cleantech teams in place for several years now.

However, the decision to launch a new division further underlines the strength of the sector at a time when the faltering economy appears to be putting a dampener on conventional investment. In contrast, several reports have confirmed that cleantech investment has continued to enjoy double digit growth throughout the first half of the year, while several solar and wind firms have also managed to shrug off the recent downturn in the IPO market and achieve successful float.