Exclusive: Rhizome raises $2.5M for utility risk AI

Rhizome, which makes software to help utilities navigate climate risks, has raised a $2.5 million round.

Why it matters: The funding marks the startup's official launch, at a time when utilities are seeing more extreme weather and soaring demand for clean electricity.

Details: Investors in the seed round for the Washington, D.C.-based company included Looking Glass, Intelis Capital, Jetstream, El Cap, Streetlife, Everywhere, and Stepchange.

• The company plans to use the funds to build out its software, which takes data about extreme weather events and helps utilities predict how they will impact the grid and its resiliency.
• Rhizome, which took its name from the underground plant networks, said it's already working with utilities Seattle City Light and Vermont Electric Power Company (VELCO).
• Rhizome CEO Mishal Thadani said VELCO is using Rhizome's AI models to make grid planning decisions like what new transmission lines to build out and how to reduce power loads during peak cold weather months.

Big picture: The power grid has been underfunded for decades, and is just starting to receive more resiliency upgrades, like the Department of Energy's recently announced $3.5 billion in grid grants.

• The grid is the key infrastructure needed to reach climate goals as a growing number of vehicles plug in and power sources transition to clean energy.

Meanwhile, extreme weather like hurricanes, wildfires and floods are wreaking havoc on utilities from California to New York.