Venture investment in green tech jumps: report

SAN FRANCISCO (Reuters) - Venture capital investment in green technology worldwide jumped 43 percent in three months to $1.2 billion in the second quarter, Greentech reported on Tuesday.

Investment in the first quarter was only $836 million, but the promise of U.S. federal stimulus money along with increased optimism helped change that, the report said.

The number of deals rose to 85 from 59, with the lead taken by solar power at 17 deals worth $330 million.

Money for solar is available both through an investment tax credit and through the economic stimulus bill passed earlier this year.

Solar was followed by auto and transport at $202 million with eight deals, biofuels, gasification and cleaner coal at $195 million with 12 deals and batteries at $181 million with 10 deals.

"Despite the economic slump, VC investors remain optimistic about the greentech sector and eventual exits in this space," the reported quoted Eric Wesoff, senior analyst at GTM Research and author of the Greentech Innovations Report, as saying.

"Exits" are jargon for either selling a business to a bigger company, or an initial public offering of stock.

John Rockwell, founder and Managing Director of Element Partners, was quoted as saying that there is a "growing belief that credit markets and the economy are on the road to recovery".

Other investments reported were: Smart grid and electrical at $101 million, with 11 deals, lighting with $47 million and eight deals, green information technology at $34 million with two deals, wind and geothermal at $22 million with four deals, water at $17 million with four deals, carbon markets and energy monitoring at $17 million with three deals, and green buildings at $7.5 million with three deals.

(Reporting by David Lawsky; Editing by Phil Berlowitz)