Breakthrough Energy's project financing group kicks off investments


Infinium's Project Roadrunner in West Texas uses waste carbon dioxide to make sustainable aviation fuel. Photo courtesy of Infinium
The project financing group of Bill Gates-backed Breakthrough Energy has made its first investment into a sustainable aviation fuel project in West Texas.
Why it matters: Breakthrough Energy Catalyst has more than $1 billion to deploy into mostly first-of-its-kind demonstration projects, helping fill a much-needed financing gap.
Details: Breakthrough Energy Catalyst invested $75 million in project equity into Infinium's Project Roadrunner, a plant that will convert waste carbon dioxide into sustainable aviation fuel.
- The companies said when built, Project Roadrunner will be the largest of its kind in North America.
- In addition to the project financing, American Airlines also agreed to a long-term offtake agreement for the project, purchasing the fuel to power its planes.
- Breakthrough Energy Catalyst head Mario Fernandez told Axios that he hopes the combination of the project financing and the long-term offtake agreement will provide a model for how sustainable aviation fuel projects can get built in the U.S.
Of note: In addition to project equity, Breakthrough Energy Catalyst can also give grants for projects where the product has a green premium.
Big picture: The climate tech venture ecosystem is readily funding tech innovation, but when it comes to mature companies that need to grow production, there's a financing gap.
- Big banks won't commonly fund first-of-its-kind demonstration projects, seeing them as too high-risk.
- Other investors have emerged in recent years to back climate infrastructure projects as well, including Generate Capital and Spring Lane Capital.
- There's a major shortage of sustainable aviation fuel in the U.S. and airlines and logistics providers are buying up as much as they can.