2007: The year of going green: CLEAN TECH PAVES WAY FOR NEW SILICON VALLEY INDUSTRY

Dec. 27--But if there was a single event that crystalized the reasons why the cultural embrace of environmental issues may have been the biggest business or technology story in 2007, it may have been the November day when former vice president Al Gore announced he was joining Kleiner Perkins Caufield and Byers, the Silicon Valley venture capital firm, as a partner to focus on green businesses.

"I think the expertise that became concentrated here with the development of computing, chip technology, Internet technology and biotech ventures . . . those skills turn out to be very applicable to the analysis and the development of early stage ventures in green tech and clean tech," Gore said in a newspaper interview.

On a personal level, of course, Gore had an incredible year, grabbing an Oscar, an Emmy and a Nobel Prize. But his relationship with Kleiner Perkins also indicates just how large a role green technology will play in the valley's future.

"There will be a huge fortune to be made in clean tech industries," said Daniel Hinerfeld, a spokesman for the National Resources Defense Council. "And that is a good sign. We're going to see a lot of investments this coming year."

That had already been happening for several years in Silicon Valley. But 2007 was the year this region staked its claim to being the world's environmental technology center just as the broader public seemed to embrace a move toward leading greener lives.

Nationwide, clean tech investments

by U.S. venture capital firms in the first nine months of 2007 were $2.6 billion, already more than the $1.8 billion invested in all of 2006. The category is now the third-largest source of venture capital, behind software and biotechnology, but ahead of things like semiconductors, telecommunications and medical devices, according to the most recent Money Tree Report from PricewaterhouseCoopers and the National Venture Capital Association.

Eric Straser, a general partner at Mohr Davidow Ventures, leads that firm's venture capital investments in clean tech. He sees 2007 as the year that Silicon Valley cemented its leadership position in environmental technologies.

"The valley is doing what it's always done: identify and highlight those problems and then attack it with great technology and labor force," Straser said. "It's no surprise to me that three or four years into the clean tech movement, the valley is a leader."

There were plenty of examples of the impact that green had on Silicon Valley in 2007:

--San Jose Mayor Chuck Reed unveiling a "Green Vision" for the city in October that included plans for lots of solar roofs, greener building standards and more recycling.

--Google.org, the search engine giant's non-profit foundation, said it will invest hundreds of millions of dollars to research and develop alternative-energy companies.

--SunPower, a San Jose solar company that went public two years ago, had posted the largest gain of any Silicon Valley stock in 2007 as of Wednesday, when it closed at $141.62, up almost threefold this year.

It seems over the coming years that investment and resources devoted to clean tech will vastly expand. As Straser notes, emerging economies around the world are creating greater pressure on natural resources and contributing more pollutants.

And if Democrats win the presidency in 2008, there is the potential for environmentally focused policies to be passed that would spur demand for the clean tech products being developed by Silicon Valley companies.

It is enough for even longtime environmentalists like Hinerfeld to feel a ray of optimism about the blitzkrieg of green marketing campaigns that swept the country this year.

"The reason that marketers are doing this is that there is a public out there on some level that cares," Hinerfeld said. "And that's huge. They wouldn't be marketing green if millions of Americans weren't concerned about changing their behavior."

Contact Chris O'Brien at cobrien@mercurynews.com or (415) 298-0207.

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