Greentech investments, which reached record levels in 2008 but fell with the economy, are beginning to return, according to a survey of the sector by Greentech Media. “Despite the eulogies delivered for the greentech sector because of a less-than-stellar first quarter, VC investment in greentech rebounded in the second quarter with more than $1.2 billion invested in 85 startups - a 50 percent increase,” writes Greentech Media’s Eric Wesoff. In Q1 2009 there were 59 deals made, worth more $836 million. In the second quarter, 85 deals were made and total investments grew to more than $1,173 million, though there were slightly smaller average round sizes than in 2008. Solar, which in 2008 represented 40 percent of total greentech investments, was the leading category in Q2 2009, with more than $330 million in funding. There has also been a “marked increase” in automotive and energy storage and an increase in smart grid investments, Wessof writes.

In addition to confidence instilled by stimulus packages is the sentiment that the economy is turning around.

"The growing belief that credit markets and the economy are on the road to recovery has investors back in the market," says John Rockwell, founder and Managing Director of Element Partner.

"Greentech markets are massive and diverse and investors are starting to pour additional money into the next wave of greentech opportunities," Rockwell says.

Last year was a record year for greentech investment, despite a fourth-quarter slowdown. It was the industry's seventh consecutive growth year.

“In 2008, there was a quantum leap in talent, resources and institutional appetite for clean technologies,” says Nicholas Parker, executive chairman at Cleantech Group.

By Mark Alvarez