Clean Power Finance, an online platform that provides software and financial services to solar power professionals and investors, has raised a fresh $37 million, in a sign that enthusiasm for the solar sector has not dimmed entirely.
Investors, particularly since the bankruptcy of the solar panel manufacturer Solyndra, have been shying away from companies that develop alternative sources of energy, risky ventures that can suck up enormous amounts of capital before becoming commercially viable.
But as the cost of rooftop solar systems has plummeted and demand has increased, big investors have been supporting a handful of companies that finance or install the equipment, rather than make them.
“Silicon Valley investors are looking for business models that look like what they’ve invested in in other sectors,†said Nat Kreamer, the chief executive of Clean Power Finance. “It’s that high-scale, high-margin business model that’s really attractive.â€
He added that investors experiencing a “solar hardware hangover†were recognizing that there is money to be made on the deployment end of the sector, which is swelling with both fast-growing companies and new entrants.
Last year, the Blackstone Group spent more than $2 billion to acquire Vivint, a home security provider with a robust solar division. Sunrun received a $60 million investment led by Madrone Capital Partners and a $200 million commitment from Credit Suisse to support the installation of residential rooftop systems, according to the solar company. And SolarCity, which provides systems for residential, commercial and government customers, pulled off an initial public offering of its stock, rare these days in clean tech.
With its third round of financing, Clean Power Finance has brought its total to about $62 million, Mr. Kreamer said. The investors include venture capitalists, large energy companies and banks like Kleiner Perkins Caufield & Byers and Edison International.
The participation of Edison International, the parent company of the utility Southern California Edison, as well as other big energy companies that declined to be identified, shows how utilities are becoming more interested in owning a piece of the rooftop solar market, he said.
Clean Power Finance’s approach differs from companies like SolarCity and Sunrun, which Mr. Kreamer helped start. Such companies generally offer customers low-cost or free solar systems in exchange for payments for the electricity produced at a rate below that for utility power.
Instead, Clean Power Finance runs a kind of online business-to-business marketplace for installers, manufacturers, developers and investors, and it provides software and financial services. One feature allows sales representatives to judge the viability of solar for potential customers and generate immediate cost estimates.
The company manages more than $500 million in project financing for corporate and institutional partners like Google and Morgan Stanley, executives said.
