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Here is what investors are saying about the U.S. climate emergency declaration that the White House is considering and what it would mean for the climate tech sector. 

Zachary Bogue, co-founder and managing partner of DCVC, on what would happen if the emergency curbed gas drilling: "Less gas drilling would — on the balance — increase the price for nitrogen fertilizer (already at a local maximum) and the cost of natural gas energy generation." 

"These would be helpful for my DCVC portfolio companies like biological fertilizer replacement company Pivot Bio and advanced nuclear energy Oklo, respectively. These would be mild tail winds and not something that would make or break their business models," Bogue adds. 

David Kirkpatrick, co-founder and managing director of SJF Ventures, on the importance of any policy response to the extreme heat and fires burning globally: "When we make investment recommendations, we talk about the policy landscape and what we’re relying on or not — federal and state. So it’s relevant."

Janice Tran, CEO and founder of Kanin Energy, on an emergency declaration and its potential impact: "I can’t see an emergency action instilling a long-term price on carbon, or to roll out billions of dollars of climate tax credits over the next five to 10 years. There are limitations of what can be effective through an emergency action alone, but it doesn’t mean Biden shouldn’t try."

Then again, Tran adds, "the emergency act is meant to be temporary and can face a court challenge, which brings in policy uncertainty, and uncertainty scares away investors."

Albert Wenger, managing partner at Union Square Ventures, on the prospect of an emergency declaration: “I also believe it could be helpful for bringing more investment to the space if companies wind up getting government orders. The administration has taken some interesting steps here, including invoking the Defense Production Act."

Catch up fast: White House press secretary Karine Jean-Pierre said yesterday that while no emergency declaration is coming this week, it remains on the table.

1 big thing: Climate tech pros on emergency implications

Firefighters fill a water aircraft to battle wildfires near Yosemite National Park in California. Photo: Neal Waters/Anadolu Agency via Getty Images)

Electrified Thermal Solutions, a Boston-area startup that says it's developed "renewable heat" for high-temperature industries like steel and cement production, closed a $4.5m financing round.

Why it's the BFD: The need for steady, ultra-hot heat has made these industrial sectors difficult to decarbonize. 

The details: Clean Energy Ventures and Starlight Ventures co-led the round. The Grantham Foundation and Clean Energy Venture Group participated.

How it works: Electrified Thermal says it's developed a way to enable electric heating of typical "firebricks," which can reach nearly 2,000° C when combined as a heater, storage medium and heat exchanger.

By the numbers: Manufacturing accounted for nearly 25% of U.S. greenhouse gas emissions in 2020, per the EPA.

Of note: Electrified Thermal got its start at MIT.

What's next: The startup says it'll use the fresh capital to "grow its core team" and build a "large laboratory prototype" outside Boston.

2. The BFD: $4.5M for industrial renewable heat

Illustration of a hand with scissor cutting emissions from a smoke stack

Following yesterday's news of TAE's $250m funding round for its fusion reactor, Alan caught up with Jim McNiel, the company's chief marketing officer. 

Why it matters: The round brought TAE's total raise to $1.2b, providing the company the capital to bring its fusion reactor online.

Catch up fast: Chevron and Sumitomo Corp. of Americas, plus existing investor Google, participated in the round.

What's happening: TAE is aiming to bring its Copernicus reactor online by 2025.

"It’s a race to net energy," McNiel tells Alan. "The valuation of these companies is pretty fixed until the next major event happens, which is net energy. When net energy happens, the one that gets it is going to go through the roof, and the ones that are behind are going to be reevaluated."

Zoom out: Investment in fusion has soared to $4.7b, per a survey by the Fusion Industry Association. And big dollars have continued to pour in despite a broader market pullback.

"This money that’s going into fusion is a hedge against volatile markets," McNiel says. "The first company to get to net energy is poised to serve a market that’s in excess of a trillion dollars a year." 

There's data to back that up: Bloomberg in December pegged the fusion energy market size at $40 trillion.

Meanwhile: Keep an eye on which reactor designs rely on tritium. From Science magazine in June: "A shortage of tritium fuel may leave fusion energy with an empty tank."

Notably, ITER, the big government-backed fusion project in Europe, "is expected to consume most of the world’s tritium, leaving little for reactors that come after."

TAE and another fusion company, Helion, are pursuing designs that don't depend on tritium.

3. Fusion's now a 'race to net energy'

Illustration of an atom with a coin as the nucleus. 

President Biden today is expected to announce new executive actions aimed at accelerating offshore wind deployment and protecting communities from extreme heat.

Why it matters: Biden, for now, is steering clear of more aggressive steps.

At the risk of sounding like Lloyd Christmas, it's apparently in hope that there's still a chance to win over Sen. Joe Manchin (D-W.Va).

Context: There are more than 35 GW of offshore wind projects in the pipeline, per the Energy Department.

The intrigue: Senate Democrats and environmental advocates are pressuring Biden to declare a climate emergency that would unlock more executive powers.

Of note: Biden is expected to make the announcement during his visit to Massachusetts.

He will visit Somerset, the site of the shuttered Brayton Point power plant, which is being turned into the state's first offshore wind manufacturing facility, our Axios Boston colleagues report. 

4. Policy corner: Biden to boost offshore wind

Illustration of wind turbines, abstract shapes and money elements.

🚙 VW's new EV ambitions: Volkswagen's plan to resurrect Scout as an EV brand is a rare chance to win back Americans' hearts, Scout's new boss tells What's Next's Joann Muller in an exclusive interview.

VW is the world's second-largest carmaker, but it's a chronic underachiever the U.S. (And let's not forget "diesel-gate.") But the automaker sees an opportunity to reconnect with U.S. consumers by offering EVs in the segments they care most about: pickups and SUVs.

💰 Big dollars for RNG: BlackRock is reportedly buying Vanguard Renewables, a Massachusetts-based RNG company, for $700m, per The Wall Street Journal.

The private equity giant apparently plans to spend as much as $1b to expand Vanguard's operations, which makes natural gas from food waste and manure.

📈 Big oil looks to climate M&A: "Europe’s oil and gas giants, flush with cash from soaring prices, are considering whether to turbo-charge their transition to clean energy with multibillion-dollar acquisitions of major renewable energy producers," per Bloomberg.

The oil companies to watch: Shell, TotalEnergies and Equinor. Their potential targets: Iberdrola, Orsted and SSE Renewables.

📰 Good news for Utility Dive and Smart Cities Dive: Industry Dive, a Washington-based business media company, has signed an agreement to be acquired by Informa, a publicly traded events and publishing company, for an enterprise value of $525m, a source familiar with the deal tells Axios Media Trends’ Sara Fischer.

It's a great outcome for Industry Dive, which has grown its business to over $100m in annual revenue over the past 10 years, Fisher writes. The deal values Industry Dive at $389m.

🏙️ Boosting city resiliency: Xcel Energy is rolling out so-called resilience hubs, outfitted with rooftop solar and battery storage, in three locations around Minneapolis, per Grist.

They’re “expected to offer much-needed backup electricity in the event of a natural disaster” and “serve as cooling and food distribution centers during heat waves and other emergencies.” Two of the three will be built in historically underserved communities in south Minneapolis.

🐔 Another reason for backyard chickens: Egg prices are topping $3/dozen for large eggs, as avian flu has wiped out more than 30 million commercial and wild birds, per Bloomberg.

But things seem to be looking up: There haven't been outbreaks in commercial flocks since June. Even so, for the chicken-curious, there's a company with the very real name RentACoop.

5. Temperature check

Illustration of an earth in space covered in red and blue meteorological color lines.

• CrossBoundary Energy, a Nairobi-based C&I renewables developer, closed a $40m equity investment from KLP Norfund Investments, a joint company between Norfund, the Norwegian investment fund for developing countries, and KLP, Norway's largest pension company. http://axios.link/Rl0j 

ZeroAvia, which is focused on hydrogen-electric, zero-emission aviation, announced $30m in funding from new investors, including Barclays’ sustainable investing arm and International Aviation Group. http://axios.link/N62L 

• Lightship, a Bay Area-based electric RV startup, raised a $23m Series A led by Victoria Beasley of Prelude Ventures. Obvious Ventures, Congruent Ventures, My Climate Journey, HyperGuap and Alumni Ventures participated. http://axios.link/YFEc 

• OMERS Private Equity agreed to acquire Bionic, a U.K.-based provider of energy, insurance, finance and connectivity services to U.K. small-to-medium enterprises, from ECI Partners and its founders. http://axios.link/4qhY 

• EV Technology Group has agreed to buy an additional 50% stake in Moke International, the maker of Moke vehicles, for $55.1 million. http://axios.link/SOqt 

• Hercules Electric Marine, a division of Hercules Electric Mobility, announced an agreement with Coach Marine Group to supply electric propulsion systems for pontoon boats. http://axios.link/OCLn 

• The U.S. Bureau of Land Management has issued final approval for Oberon Solar’s 500 MW solar project in the desert east of Palm Springs, California. The project will be co-located with a 500 MW battery storage system. http://axios.link/KmBa 

• Keppel Energy Nexus received a contract to pilot a 1.5 MW membrane-based nearshore floating solar PV system at Jurong Island, Singapore, with technology from Ocean Sun. http://axios.link/ANSY 

• The U.S. Army bought a GMC Hummer EV from GM Defense for testing. http://axios.link/EhIF 

• Totalenergies is suing Trina Solar, accusing the big-time solar manufacturer of fraud and breach of contract relating to about $300m in module orders, amounting to over 900 MW. Trina said that it’s “extremely disappointed” by the action. http://axios.link/bVXG 

6. Hot deals

• Morrison & Co. has hired Lauren Beshore as deal team lead, who will head up investments in the energy transition. Beshore was previously vice president of the Global Infrastructure Opportunity Fund at The Carlyle Group.

• eCombustible Energy, developing hydrogen-based fuel for thermal industrial applications, has named Steven Eisenberg as general counsel. Eisenberg was previously a partner at Eisenberg Lehman. http://axios.link/WaSS 

7. It's personnel

Brian Kahn is climate editor at Protocol.

8. Tweet o' the day

A tweet from Protocol climate editor Brian Kahn.

🚗 Situational awareness: Tesla is set to report its Q2 earnings this evening. A call is scheduled for 5:30 p.m. ET.

🍝 Most pasta nights, Alan makes his own marinara (h/t Alaimo family). But he keeps jars of Rao's in reserve. And there's one thing he's discovered: When it comes to eating straight from a jar, Rao's marinara gives peanut butter a run for its money. 

July 20, 2022

1 big thing: Climate tech pros on emergency implications