Article Image

IPFS News Link • Business/ Commerce

Is Crowd Funding a Good Thing for Clean Energy Innovation?

• http://blogs.scientificamerican.com

One distinction between renewable energy technologies and their nonrenewable counterparts is their popular appeal. Surveys have found a majority of Democrats and Republicans support increasing government funding for renewable energy research and tax rebates for people who purchase solar panels or energy efficient vehicles. Public support for fossil fuels is decidedly lower, with 70 percent of Americans saying all subsidies for fossil fuels should be discontinued, including a majority of Democrats, Republicans, and Independents.

The popular advantage that renewable energy technologies have over conventional energy technologies isn't just a marketing perk, but also a potentially decisive advantage in an emerging fundraising trend for startup companies: Internet-based crowd funding through a service like Indiegogo, which allows startup companies to solicit small donations from ordinary Internet users. Since the 2012 Jumpstart Our Business Startups (JOBS) Act loosened restrictions on crowd funding, the unique financing tool has become an increasingly appealing option for cleantech startups hoping to make their idea a reality.

Solar Parking Lot

Solar Roadways co-inventors stand near a prototype solar parking lot outside their backyard lab. (Source: Solar Roadways)

The most notable example of late is the Solar Roadways Inidiegogo campaign, which raised over $2.25 million to develop solar panels that double as a drivable road surface. Solar Roadways created a tidal wave of excitement around their technology using unconventional marketing tools like a YouTube video titled "Solar FREAKIN' Roadways!" that went viral shortly after it debuted. After achieving Internet fame, the campaign went on to more than double its $1 million fundraising goal, setting an all-time record for the Indiegogo site. 

Considering the unbridled success achieved by the Solar Roadways campaign, it's easy to think crowd funding could be a game changer for clean energy innovation. When conventional forms of capital were unavailable, Solar Roadways found funding through the people of Internet in a uniquely democratic way. That's a win for renewable energy and the environment, right?

Despite the flurry of popular excitement that emerged around the Solar Roadways campaign, there are still legitimate questions remaining about whether the technology is actually deserving of all the funding it attracted. A number of experts have pointed out underlying issues with the concept of embedding solar panels in roadways, including Scientific American's own David Biello. For one, putting solar panels in the roadway puts them underneath cars, mud, dust, and other forms of shading that can dramatically reduce the solar panels' electrical output, and thereby decrease their value. On top of that, it's already difficult to afford building and maintaining ordinary asphalt roads and highways in today's era of cash-strapped governments, so it's hard to see how we could possibly afford roads made out of tempered glass, solar panels, and complex electronics.