Marc Gunther: This is Marc Gunther. I'm at the GE Global Research Center in Niskayuna, New York -- that's near Albany -- and I'm joined by Kevin Skillern. Kevin is Managing Director of Venture Capital for GE Energy Financial Services -- that's a unit of GE Capital. He overseas GE's Venture Capital Portfolio in Cleantech companies.

Kevin, tell me just as we get started, why is GE in the Venture Capital business and talk a little bit about your portfolio in general terms before we talk about a couple of the specific companies.

Kevin Skillern: We started in the venture capital activity about four years ago in the middle to late 2005. And really, the motivation at first was greed. We had seen several other investors make relatively small investments in some of the solar companies that had gone public and literally had made about $200 million on as little as a $10 million investment. And so the leadership of our business looked at that, said, "Well, why can't we do that?" And so it really was a greed factor to start with in saying, "How can we make more money for GE?"

We spent a bunch of time looking at opportunities. We were a little bit concerned about the market fundamentals and that was a period when ethanol companies were very hyped up. And we were concerned that there was a lot of hype and not a lot of substance there, and so we started conservatively.

We studied the market. We started looking at specific companies to invest in. We had the very good fortune of the first investment that we'd made, which really was the first new venture capital investment by GE, and four years at that point was in a company called A123 Systems that recently went public.

MG: Now, we'll get to that in a minute. Did you get into any ethanol companies, Kevin?

KS: We did not -- in our side of the business. I think, in some part of GE, probably there was, but not in our side of the business. So if we started with the financial motivation, we really realized and we put a set of policies in place that allowed us to succeed as an investor but also as a partner with the companies that we invested in. And I think we quickly realized that the shifts going on in energy and the business that we're in within GE is amongst the largest financial investors in energy in the world.

GE is a major company in the energy industry supplying important components of the power generation industry, the power transmission as well as the oil and gas industry. Given the presence of GE in the energy industry globally, the impact that potentially could play out with the emergence of these breakthrough technologies is significant.

And beyond the financial returns, we quickly realized that there was a real technology window benefit that, by seeing the types of companies and what they were doing and acting as a good partner, we could have an earlier read on what was actually happening, where the big opportunities existed for those companies as well as for GE and partnership with those companies.

MG: And roughly, what's the size of the portfolio and about how many companies have you invested in so far?

KS: Since January 2006, we have invested in 20 different companies, all in, from a GE Capital perspective; we have invested about $160 million of capital into those 20 companies. We invest at the rate of about seven or eight companies a year, is kind of the notional target. We are not a fund. We are investing GE's money -- GE Capital's money into these companies with a clear financial expectation in terms of having returns that are profitable for the company.

MG: Okay, now during today's press presentation, we've heard from some of the companies. I'd like you to talk a little bit about a few of those. One of them was Soliant Energy Company that's just getting started. What's their business, and what made them an attractive investment for GE?

KS: Soliant Energy is a company that's now started to shift product. The technology that they have developed is really a system for the production of solar power on commercial rooftops. If you look around the world, there are lots and lots and lots of commercial rooftops that are under-utilized space. They're just there to provide protection from the rain, protection from the environment, and other than that, there's an opportunity to make money out of what's sitting there with that idle rooftop.

And what their technology in essence does is uses optics instead of more material and concentrates the light coming through from the sun 500 times more concentrated than typical sunlight onto a much smaller footprint of solar material and high cost component, and then uses tracking technology that will follow the sun that allows the optimization of the energy production.

What makes Soliant Energy special is that there's a real likelihood that they will have the best economics. So if you were a building owner, and you had said, "Well, I want the most economic asset sitting on top of that roof to produce my power," that Soliant, because of the cost elements as well as the high -- relatively high energy production compared to other options on what you could put on your roof for solar power, would be the most economic choice for owners.

What's interesting about that as well -- where the opportunity is best, so where the sunlight is best, and solar power also depends on humidity, so in Florida, for example, the dispersion of the rays, because of the moisture that's in the air, makes solar power less effective than you might have in Arizona or California where the air is drier?

So in places where the insulation, the amount of sunlight reaching the rooftop, is greatest in places like Spain and Arizona and California, when you're producing that power also happens to be at the peak rates that the utilities are charging you. And this is something that even the next several years could be a highly economic purchase for customers in that very target but still substantial market.