The clean-technology revolution will likely make a lot of people in Silicon Valley rich, but it's also going to help bring back some of the factory jobs that have disappeared.
Why? Weight, for one thing, explains Kevin Surace, CEO of Serious Materials, which recently landed $50 million in funding to build factories for its eco-friendly drywall.
Although labor is cheaper in China, shipping costs are going up, primarily because of fossil fuels.
"You could spend $2 to $3 a panel just to ship it (drywall), and that's just to get it to the dock. You'd then have to spend another $3 to $4 to ship it by rail," he said. "You can't do that if you plan to sell it for $10 to $20 a board."
As a result, Serious Materials will open its first factory, which will be capable of churning out 400,000 square feet of drywall a year, in the United States. It will likely also build its next two factories in the States as well, regionally spaced out to serve different markets.
Shipping materials from China also "blows the whole point about zero carbon dioxide," he added. "You're on the wrong side of the energy curve."
State governments are also offering substantial incentives--free rent in industrial parks, tax holidays, loans, grants--to woo these companies. "States do not want to be left out of the next industrial revolution," Surace said.
Some of the most aggressive states include New York, California, and New Mexico.
The heartening part of all of this is that Surace isn't alone. Bruce Jamerson, CEO of Mascoma, which wants to make cellulosic ethanol, has said the same thing. Mascoma is building plants in Michigan, New York, and Tennessee because that's where the wood chips and vegetable matter are. Several analysts have said shipping is one of the big barriers for Chinese solar-panel makers.
Granted, it's not like these companies are staying in the States because the CEO woke up one day to a Bob Seger song playing on the radio and started getting misty-eyed over the disappearance of the industrial heartland. They are being encouraged to stay stateside in part because of subsidies.
But other factors--like shipping costs, the low prices of their products, and the proximity to local markets--could conspire to get the manufacturing arm of the country moving again.
Serious Materials, which has come up with a formula for eco-friendly drywall, has landed $50 million to build factories.
New Enterprise Associates, Foundation Capital and Rustic Canyon Partners participated in the second round of financing for the company, according to CEO Kevin Surace. Previously, Serious raised $5.5 million. The fact that the company was closing a large funding round came out earlier this summer.
Serious drywall samples bring glee to model
(Credit: Michael Kanellos/CNET Networks)The company's product is the equivalent of Jell-O instant pudding of the clean-tech set. Most drywall is made from gypsum baked at high temperatures. The cooking process releases substantial amounts of carbon dioxide. By contrast, Serious has a formula in which chemicals are placed into a mold and then congeal into drywall. It takes very little energy and thus results in low carbon dioxide emissions.
Serious, in fact, hopes to run its first factory, which will be capable of churning out over 400 million square feet of drywall a year, on a 100-kilowatt solar system. The new funding potentially could allow Serious to build two to three plants in the U.S.
EcoRock, the name of the eco-friendly drywall coming from Serious, will cost more than standard drywall, but the premium won't be prohibitive, the company has said.
Serious makes samples of EcoRock now, but won't get into volume manufacturing for commercial sale until next year. However, it already sells QuietRock, a soundproof drywall, so it has an existing sales channel. Snoop Dogg bought some for his house.
QuietRock has also helped it establish a channel for sales for Serious, which is key in the conservative, slow-moving building materials market.
Foundation, meanwhile, is expected soon to announce an investment in a company that makes eco-friendly cement.
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