Sunday, April 15, 2007

Comverge has big first day on Nasdaq

EAST HANOVER -- Shares of Comverge Inc., a New Jersey company that helps utilities reduce electricity use when demand is strongest, jumped 24 percent in their first day of trading after an initial offering that raised $95.4 million.

The stock rose $4.31 to $22.31 in Nasdaq Stock Market composite trading after the company sold 5.3 million shares to the public for $18 each. Comverge is a former division of Mahwah-based Acorn Factor Inc.

Comverge and competitors attracted investor interest by offering better ways to manage electricity demand amid mounting concern over the role of power plant emissions in global warming. The company said its demand-reduction products are 40 percent cheaper than building new plants and don't pollute. Rival EnerNOC Inc. of Boston also plans an initial offering.

"The potential here is huge," Jon Wellinghoff, a Democratic member of the Federal Energy Regulatory Commission, said Friday at an investor conference on energy efficiency in New York. "It can be done all the way down to small-commercial and residential customers."

Venture-capital investment in companies that make environmentally friendly systems related to electricity, transportation and water rose to $2.9 billion last year from $1.6 billion in 2005, according to the Cleantech Venture Network.

Comverge makes devices that enable utilities to wirelessly disable high-power-use appliances such as air conditioners to avoid blackouts and other disruptions during periods of peak electricity demand. Customers who agree to have their service temporarily interrupted at such times generally are rewarded with lower rates.

As power prices rise, homeowners and businesses are "going to be motivated to find ways to shave" consumption, said Joel Serface, director of the Clean Energy Incubator at the University of Texas at Austin and a former venture capitalist.

Comverge, which markets itself as a "clean energy" company, also manages demand-reduction programs for utilities and markets equipment for electric meters that provides data about power consumption.

Spending to reduce electricity consumption when demand is highest is forecast by the U.S. Department of Energy to reach $1 billion annually by 2020, the company said in the filing.

The company, which has yet to have a profitable year, lost $6.16 million in 2006 on sales of $33.9 million, compared with a loss of $7.98 million on sales of $23.4 million the year before, according to the filings with the U.S. Securities and Exchange Commission.

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