Going toward the light

SAN JOSE, Calif. — Clean-tech venture capitalists have taken a shine to Silicon Valley makers of LEDs and other bright lights, seeing a growing potential for these semiconductor-based light sources in streetlights and parking lots, in concert venues and gymnasiums.

And, soon, in your home.

According to the Cleantech Group, a San Francisco researcher and conference organizer, venture-capital investments into lighting technologies reached $100 million in 2008’s first quarter. That ranked behind only biofuel and solar among clean-tech categories.

“The way we light things today uses 25 percent of our energy in the United States,” said Alain Harrus, a partner at Crosslink Capital, a San Francisco venture firm with investments in two lighting companies, Intematix of Fremont, Calif., and Luxim of Sunnyvale, Calif. “The opportunity there is to switch to a much more efficient way of using the electricity.”

Most consumers know LEDs as the twinkles on their Christmas trees, the numbers on their calculators, the source of light on their cell phones. But they’re increasingly found in televisions, medical devices and streetlights. Some suspect they’ll soon be used in new homes.

Investors are trying to find products that use less energy but do the job as well as existing sources.

“Edison’s invention to banish the night was one of the most important inventions of the last century,” he said . “But the light sources of today aren’t exactly doing what you want them to do.”

Governments are working to eliminate incandescent bulbs, which are inefficient energy hogs. And the energy bill signed by President Bush late last year requires a nationwide boost in efficiency, which most see as the end of incandescents in the United States.

Compact fluorescent lights, or CFLs, are touted as a replacement, but they contain traces of mercury, must be recycled and the light quality is imperfect, said Mark Swoboda, CEO of BridgeLux, another Sunnyvale firm.

Advances with LEDs, including better white color and lower prices, have changed the formula, making them an increasingly realistic alternative. “Technology has broken the barrier,” he said.

That’s attracting lighting companies – big and small, local and global – as well as big customers.

Wal-Mart, which sold more than 100 million CFLs to customers in 2007, is using more LEDs in its stores, said Matt Kistler, the company’s director of sustainability.

Coupled with motion sensors, LEDs work well in refrigerators and freezers in Wal-Mart’s grocery aisles, he said. They turn on when customers walk by, and turn off when nobody is near. They’re cooler than incandescent lights, saving energy. They last longer, so Wal-Mart saves money.

Home Depot shoppers will find a few LED light choices now – landscape lights; stick-on, one-touch light sources; under-counter lighting; even a bulb that fits into a household lamp.

Makers tout the long-term ownership cost of LEDs, and the bulbs do last about 50,000 hours in some applications. They use about one-sixth the energy of incandescent bulbs.

Clear 30°

Business

Venture-capital investment in lighting technologies was $100M in year’s first quarter.

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