"It's more to advance automobile technology, and certainly that's a game the VCs know very well," Jensen said.
In fact, the quarter's two largest deals -- both $100 million -- were transportation-related. San Diego-based startup V-Vehicle, seeking to build a fuel-efficient car in Louisiana, is being funded by Kleiner Perkins Caufield & Byers and T. Boone Pickens. Meanwhile, the funding round for lithium-ion battery startup A123, based in Watertown, Mass., was led by General Electric, among others.
Government stimulus funding also has been making an impact. Solyndra, a Fremont solar panel maker, was awarded a $535 million loan from the federal government in late March. And just last week, San Carlos-based Tesla Motors received a $465 million federal loan to jump-start production of its electric cars.
"Without a doubt, that's helping investors' confidence," Fan said. "It's been a huge shot in the arm for the industry."
Investments in biofuels totaled $206 million, $57 million of which went to South San Francisco-based Solazyme, which makes oil from algae. The capital was raised from Braemar Energy Ventures, Lightspeed Venture Partners and new investor VantagePoint Venture Partners.
Advanced batteries
Advanced batteries accounted for $165 million of the total investments, while solar investment totaled $114 million, its lowest level in more than three years. That was down from a high of $1.2 billion invested in solar in the third quarter of 2008.
Jensen said the drop in solar financing is partly due to VCs shifting their focus from capital-intensive projects, such as thin-film solar or concentrated solar-thermal technologies, to less expensive technologies, such as improvements in chips that can make solar cheaper and more efficient.
Which is not to say that investors are giving up on solar, Fan said.
"They've spent billions in solar-thermal and thin-film photovoltaic; they have made those investments and they're not moving away from them."
Contact Tracy Seipel at tseipel@mercurynews.com.
Venture funding for clean tech
The $1.2 billion in venture capital invested in clean technology during the second quarter included:
$236 million for transportation
$206 million for biofuels
$165 million for advanced batteries
$114 million for solar
Source: The Cleantech Group and Deloitte & Touche
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