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BFD Expert Voices - Climate Deals

BFD Expert Voices

Government money is pouring into California, Connecticut, Massachusetts and New York to expand their port infrastructure for offshore wind, Alan writes.

Why it matters: Wind turbines are massive, which means they'll need new infrastructure to put them to sea. With the feds finally green-lighting offshore wind leases, the race is on for the industry's dollars and jobs.

What's happening: The four states received more than $340 million in Q4 alone in local, state and federal money and funding commitments, per a report this morning from the Business Network for Offshore Wind.

The funds were for Humboldt Bay in Northern California; Bridgeport, Conn.; Salem, Mass.; and Staten Island, N.Y. 

Another $124 million-plus would be needed to build new offshore wind infrastructure in Humboldt Bay.

Of note: Construction hasn’t yet started for the bulk of new offshore wind projects. But developers have contracted for 17.5 GW of development, and lease auctions last year brought in $5.4 billion.

Meanwhile: Upstream investment is surging, too.

Nucor, for example, began producing steel plate for wind turbine foundations at its new $1.7 billion plant in Kentucky.

1 big thing: 4 states emerge as offshore hubs

Illustration of a bald eagle clutching a wind turbine in its talons. 

EnrichAg, a subsidiary of ag tech company Terramera that focuses on soil testing, has raised $6 million of a planned $15 million Series A round, the company exclusively tells Megan.

Why it's the BFD: Ag tech startups continue to win over investors eager to tap into the resilient funding landscape around climate tech startups. 

Details: At One Ventures led the initial tranche of the all-equity funding, and founding partner Tom Chi will take a seat on EnrichAg's board as part of the deal. 

The company expects to raise the remainder of the round in the first quarter of 2023, Terramera CEO Karn Manhas tells Megan.

Terramera, which is based in Vancouver, British Columbia, is still a majority owner of EnrichAg, Manhas says.

Context: Terramera owns and operates multiple subsidiaries that rely on its library of patented software to run independent businesses.

How it works: EnrichAg sells software to help farmers analyze soil contents and recommends ways to increase carbon content in those soils to help stimulate crop growth.

It collects soil nutrient data via a proprietary sensor that tracks the levels of nitrogen, phosphorus, potassium and carbon. 

Manhas says the AI-based software can help farmers decrease the amount of nitrogen-based fertilizers they use.

EnrichAg is currently operating its beta-phase sensor and plans to roll out a wider, subscription-based software model to its customers later this year.

2. The BFD: Soil tester EnrichAg digs up $6M

Illustration of shovel in a dirt pile with Ben Franklin's face.

 It's set to be a big year for EV charging. That, at least, is the prediction from Neha Palmer, co-founder and CEO of TeraWatt Infrastructure.

"We think this is a new asset class, similar to data centers: You’re going to hear about more investments into this space from people who think about it from that perspective," Palmer tells Alan.

Why she matters: TeraWatt in September announced it had raised more than $1 billion to build a charging network for commercial vehicles, including semi trucks.

The company expects to bring its first half-dozen sites online by the end of this year in Southern California.

Palmer was previously head of energy for Google. 

This interview was lightly edited for length and clarity.

What was the big story in clean energy/climate tech this week?

CES last week felt like an auto show: EVs becoming mainstream, gadgets and technology around vehicles, announcements rivaling the Detroit Auto Show.

You think about that adoption S-curve, it seems like we’re really accelerating up that curve.

Charging is coming to the forefront. But how do you operationalize that? How do you bring it into your life as a consumer?

Two years ago, it would've been all about the vehicle: "Look how cool this is and how beautiful."

This one booth literally had one feature: a charger that looked like mid-century modern furniture, and that was it. It was stunning. 

What’s going under-covered or under-noticed?

A lot of the focus has been on this passenger vehicle market. We’re seeing a lot of announcements about trucks finally coming off the assembly line.

We’re seeing mainline fleets — some that already have giant fleets of ICE vehicles — making really big orders. 

I come from the cloud space. Cloud-first companies didn't have servers in their basement. They had to find public infrastructure. 

Other companies, like banks, had giant server infrastructure in their basements. Their equivalents in transportation, these companies, are now migrating to EVs.

In three-ish words, what change would you make to clean energy/climate-tech investing?

Climate tech/clean energy is infrastructure.

💼 First job: Selling newspapers over the phone for the Contra Costa Times.

👑 Proudest investment decision: You can never go wrong in investing more in education. I’m glad I went back to get my MBA.

🤦  The one you regret: I wish I had done that earlier. 

3. Expert voices: It's all about charging

Photo illustration: Shoshana Gordon/Axios. Photo: Courtesy of TeraWatt Infrastructure

📦 Climeworks makes a delivery: The direct air capture company said it's started delivering third-party verified carbon removal and storage services for its first corporate buyers, Axios' Ben Geman writes in Generate.

The Swiss startup said it's providing services from its plant in Iceland to customers including Microsoft, Shopify and Stripe. The announcement did not disclose the volumes.

🏆 Joann's cars of the year: Our What's Next colleague Joann Muller yesterday named her favorite car, truck, and SUV of 2022. Each is an EV.

Car of the year: The Genesis G80 Electrified. (Coming soon to Climate Wheels!)

Truck of the year: The Ford F-150 Lightning. (Alan agrees.)

🏭 Climate tech enters its Industrial Age: The market for certain "clean" technologies is set to triple to $650 billion annually by 2030 — and that's under existing policies and pledges from national governments, Ben writes.

"Related clean energy manufacturing jobs would more than double from 6 million today to nearly 14 million by 2030," per a new report from the IEA.

More than half of those jobs: EVs, solar PV, wind and heat pumps.

⛏️ Reading the tea leaves on Saudi mining: Our deals rundown yesterday included Ma’aden's joint venture to begin developing certain minerals.

The move by the state-owned mining company — alongside Saudi Arabia's sovereign wealth fund — signals the petro-state's push to diversify its economy.

It's also part of global competition in the market for materials used in batteries, renewable power equipment and other climate tech.

📈 Battery market keeps going and going and going: High prices for lithium and other commodities aren't slowing the super-hot battery market, Nat Bullard writes in Bloomberg Green.

Installed energy storage capacity is expected to double this year, per BloombergNEF.

The drivers: incentives in the IRA; a rush to ensure stable sources of energy because of Russia's invasion of Ukraine; and expensive electricity costs, especially in Europe.

🐮 Sustainable ranching: Giddy-up, climate-conscious beef lovers. A new co-op called Country Natural Beef is aspiring to become "the West’s largest climate-smart ranching program." Civil Eats has the deep dive.

4. 🌡️ Temperature check

• No Meat Factory, a Canadian alt protein maker, raised US$42m in Series B funding. Tenglemann Growth Partners led, and was joined by insider Emil Capital Partners https://axios.link/3CHJCx8

• Apollo Global Management and Platinum Equity are among those kicking tires on Univar Solutions, a Downers Grove, Ill.-based chemicals distributor with a $5.3b market cap, per Bloomberg. https://axios.link/3Qyo8sm 

• Apollo Future Mobility, a Hong Kong-based luxury vehicle tech company, including EVs, agreed to buy Chinese electric vehicle maker WM Motor for $2b. 

That’s less than the $2.75b WM had raised in venture  funding from firms like Baidu, Sequoia Capital China, Tencent, SAIC Capital China, Hongta Venture, Susquehanna Asia Investments, Grand Flight, Far East Horizon and Cedarlake Capital. https://axios.link/3XmpEQC 

• Sealed, an NYC-based home-energy improvement company, acquired InfiSense, a Burlington, Vt.-based data provider. https://axios.link/3Xkv6n0 

• Tesla is pursuing a $775.7m expansion of its factory in Austin, Texas. https://axios.link/3CKCFLQ

• Hydrostor, a Toronto-based developer of long-duration energy storage from compressed air, signed a 25-year, $775m PPA with a group of local governments in California, per the LA Times’ Sammy Roth. https://axios.link/3X7cHu6 

• Leeward Renewable Energy, a Dallas-based renewables developer, closed about $260m in construction financing and secured tax equity commitments for its Chaparral Springs solar-plus-storage project in Kern County, Calif. The project consists of 174 MW of solar and 88 MW of storage. https://axios.link/3k96sre 

• Bristow Group, a Houston-based aviation provider that’s recently invested in electric aircraft for its fleet, entered into two 13-year secured equipment financings up to £145 million with National Westminster Bank. https://axios.link/3IHlr5Q 

• Zinc8 Energy Solutions, a Vancouver-based developer of zinc-air batteries, received up to C$500k in R&D funding from the National Research Council of Canada’s Industrial Research Assistance Program. https://axios.link/3GX1kiY 

• Freyr Battery, the Luxembourg-based battery manufacturer, entered a five-year conditional offtake agreement with Impact Clean Power Technology, a battery systems manufacturer, to supply 10-14 GWh of battery cells starting in 2025. https://axios.link/3X5XPwh 

• RPower, a Woodlands, Texas-based microgrid developer and energy services provider, received a contract from Bell County Water Control and Improvement District No. 1 in Texas to develop a 10 MW microgrid system fueled by natural gas. https://axios.link/3IID6dv 

• Babcock & Wilcox, the Akron, Ohio-based engineering firm, received a contract from Phillips 66 to design flue gas pre-treatment technology upstream from a planned CO2 capture system in North Lincolnshire, U.K. https://axios.link/3GIfjrI 

• Redfin, the Seattle-based real estate site, added estimated energy costs to its home listings through a partnership with Wattbuy, a Bellevue, Wash.-based electricity management provider. https://axios.link/3k0P4EY 

• Intersect Power, the Beaverton, Ore.-based utility-scale developer, announced that its 310 MW Athos III solar project in Riverside County, Calif., entered commercial operation. https://axios.link/3kaqO3r 

• Lafarge Canada, the construction materials manufacturer, and TransAlta, the Alberta-based power producer, entered an agreement to use fly ash from a retired coal-fired power plant as a replacement for cement in concrete. https://axios.link/3W40oNZ 

• Chesapeake Energy Corporation, EQT Corporation and Equitrans Midstream Corporation, launched an “Appalachian Methane Initiative” to monitor methane emissions from their natural gas projects in the region. https://axios.link/3IITeLX 

5. Hot deals

• Tenaska, the Omaha-based energy holding company, named Chris Leitner as CEO. Leitner was previously president of Tenaska Development and Tenaska Generation. He succeeds Jerry Crouse, who was named board chairman. https://axios.link/3CEUFaI 

• Wolfspeed, the Durham, N.C.-based semiconductor technology provider for the energy sector, promoted VP Elif Balkas to CTO. She succeeds the late John Palmour. https://axios.link/3Xrc26M 

• Spearmint Energy, the Miami-based solar and storage development and trading firm, hired Peter Rood as chief development officer. Rood was previously chief development officer at GlidePath Power Solutions. https://axios.link/3X4lxZS 

• Quorum Software, a Houston-based software provider for the energy industry, appointed Jan Manning as chief information officer. https://axios.link/3WeirkQ 

• Quinbrook Infrastructure Partners, the Houston-based investment firm, hired Bobby Hollis as chief commercial officer and Dan McNary as COO of Rowan Green Data, a standalone company providing siting and renewable energy procurement services for data centers. https://axios.link/3XlPxQA 

• Hyzon Motors, the Rochester, N.Y.-based manufacturer of hydrogen-powered commercial vehicles, promoted managing director John Edgley to president of international operations. https://axios.link/3CDnLHp 

• Eaton, the Cleveland-based power management company, promoted Mike Yelton to president for the Americas region, electrical sector, and Pete Denk to president for the vehicle group, effective April 1. https://axios.link/3Gzy0xG 

• The Brattle Group hired Tom Chapman as a principal in the firm's electricity wholesale markets & planning practice in Toronto. Chapman was previously senior manager for IESO Ontario. https://axios.link/3CHHAxd 

• Planet Biogas, a Germany-based RNG provider, hired Mike Muffels as program director and David Thompson as business development director for its new company Planet Organics, which will develop food waste processing and nutrient recovery projects in the U.S. and Canada. https://axios.link/3INHmZr 

• Opportune, the Houston-based consulting firm, promoted managing director Trent Determann to partner, and Kevin Cannon and Teresa Kroh to principal. https://axios.link/3CHTMOi 

• The Natural Resources Defense Council added David Hayes as a senior fellow. Hayes was previously deputy secretary of the Interior and senior White House climate adviser. https://axios.link/3CHXtnl 

6. It's personnel

Happy Thursday! We're just about through to the long weekend. Let's dig in.

🍲 Megan is very grateful for a local restaurant's pozole for bringing her back to life.

😴 Alan and Terry are in the middle of their 18-month-old's latest sleep regression.

Thanks to Michael Flaherty and Phoebe Neidl for today's edits.

And thank you for reading Climate Deals! Please share with your friends, family and agriculture enthusiasts.

January 12, 2023

1 big thing: 4 states emerge as offshore hubs