September 16th, 2014


CEO, Siva Power

Founder, SunEdison; Co-Host, The Energy Gang

Can idealism and capitalism coexist?  Just ask Jigar Shah and Brad Mattson.  Both are running successful companies that were founded on principals familiar to Climate One listeners: social justice, energy equality and environmental stewardship.  But that doesn’t mean they plan on losing money.
After 30 years in the semi-conductor industry, Brad Mattson took time off to work with social entrepreneurs around the world. “And what I found, whether you’re in Africa or India or in the jungles of Nicaragua, if you want to enrich lives, you want to like reduce poverty, energy is at the base of it.”
The key to making solar work in those developing countries, he says, is “bringing the technology to scale.”  As CEO of Sivapower, he is working to do just that.
“I really wanted to see technology benefit humanity in a more direct way, and I saw solar as a way to really do that.  It’s not just technology for technology’s sake but it can have a profound positive impact.”
When Jigar Shah was a teenager, he read a book that sparked a lifelong thirst for power – electrical power.  “It was a book on electricity…here’s how coal power worked, here’s how wind power worked, here’s how nuclear power worked, here’s how solar power worked.”  The concept of harvesting power from the sun caught his imagination and led him to the solar energy division of the oil giant BP.  There, Shah learned the ropes of venture capitalism - lessons he would later apply when he started his own solar power company, SunEdison.  Too many green businesses fail, he says, because their founders don’t understand that the rules of capitalism still apply.
“Everything has a trillion dollar price tag associated with it, right?  I mean, if you want to decarbonize our grid, it’s a trillion dollars.  If you want to provide energy access to the poor in all these countries around the world, it’s a trillion dollars.”
So how do you raise a trillion dollars? Just like any venture capitalist, “you start with… a hundred thousand then you get to a million then you get to ten million then you get to hundred million. And each pathway you’re actually proving to a larger source of capital that you deserve the right to use their capital, right? And I think that that requires some respect for the system.”
Solar energy, says Mattson, offers plenty of opportunity for the savvy – and well-timed – investor. “We’re past the technology driving points,” he says. “So a lot of like startups that look at new technologies for renewable energy, aren’t so important as the deployment side.”
But, he cautions, there are problems yet to be solved.  As an example, he cites solar provider SolarCity, “a classic example of doing residential, but there’s a huge market in the commercial area that’s still kind of untapped…it’s a problem between who owns the facility and who’s leasing the facility, the ownership.  But if you solve that business problem, it’s a huge opportunity. So these new business models need to come into play, you need to be looking out for those.”
Can big business change the world for the good?  If you ask Shah, there’s no other way.
“I actually don’t think that you can solve the world’s problems without a trillion dollars,” he declares. “And no one’s going to give you a trillion dollars unless they believe that you’re going to be a good steward of that money and that you’re going to give them a solid rate of return.”
In short, says Shah, “I think that to make social progress at scale, you have to be good at business."
– Anny Celsi
September 16, 2014
The Commonwealth Club of California