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BFD Expert Voices - Climate Deals

BFD Expert Voices

Air Company, the vodka-distiller turned sustainable aviation fuel (SAF) maker, has inked a $65 million government deal for testing SAF production with the U.S. Air Force, the company exclusively tells Megan.

Why it matters: This is Air Company's latest high-profile SAF contract and a deal that highlights the fuel's potential to become a low-emission heavyweight in aviation.

Driving the news: The contract comes after a successful jet test flight last year that ran solely on unblended SAF, Air Company CEO Gregory Constantine tells Megan.

The $65 million will allow Air Company to test whether it can make SAF in remote locations such as an aircraft carrier.

The contract also includes certain milestones related to the number of gallons of SAF that Air Company will produce, but Constantine declined to disclose those figures.

How it works: Air Company makes SAF by heating up water and carbon using renewable power.

It has fuel-purchase contracts in place with JetBlue, Virgin Atlantic and Boom Supersonic.

Of note: Constantine declined to comment on the company's fundraising activity. It raised $30 million in Series A funding in April.

The bottom line: Wider adoption and commercial use of SAF still remains far off, even as pilots take off.

1 big thing: Air Company lands Air Force deal

Industrial Sun, a Texas-based solar company, raised $90 million in financing from investment firm EIG Global Energy Partners and Modern Energy, Megan reports.

Why it's the BFD: The company is expected to build facilities that will help companies augment power from ERCOT, Texas' wholly independent power grid, which has come under scrutiny for its inability to handle customer demand.

Flashback: Industrial Sun raised $30 million in initial financing from investment firm Modern Energy in November 2021.

How it works: Industrial Sun builds large solar plants that plug into customers directly and helps them bypass substantial electricity bills during demand surges.

Between the lines: Industrial Sun is working around ERCOT's aging transmission network, which is prone to overload, by building its projects close enough to its customers so that the power does not have to run through transmission lines.

The company aims to create a reliable source of back-up power for high-demand companies.

2. The BFD: Texas solar group nets $90M from EIG

Illustration of a man working on a solar panel with a money overlay

💻 ESG 365: Microsoft's Climate Innovation Fund invested in New York-based ESG software company Novata via its $30 million Series B Tuesday, the company tells Megan.

Hamilton Lane led the round, with participation from existing investors the Ford Foundation and S&P Global. Partners and managing directors from Canson Capital Partners, Clearlake Capital, Hellman & Friedman, Kohlberg & Company, Lindsay Goldberg and The Vistria Group also participated in the round.

Novata launched in April and has 3,500 companies under contract to use its software, it says.

📋 Less SaaS, more DaaS: Apex Group unveiled its ESG data-as-a-service product for the private markets on Monday as the battle for ESG data benchmarking heats up.

Though ESG data has been heralded as the next big accounting boom since Dodd-Frank, the data itself remains cluttered with low-quality information that is hard to quantify and verify.

Apex says its database is built using data from as far back as 2019 and includes 400 GPs and 1,500 portfolio companies, to create benchmarks for private companies.

🏁 On your marks: Auto giant Stellantis — parent of Chrysler, Citroën, Jeep and more — is investing $155 million for a 14.5% equity stake in a subsidiary of McEwen Mining, which has copper projects in Argentina and Nevada, Axios' Ben Geman writes.

Automakers are racing to lock up supplies of critical materials needed to produce EVs in a tightening global market.

3. 🌡️ Temperature check

Illustration of a thermometer shaped like a smoke stack with smoke spewing out.

• SepPure, a Singapore-based developer of industrial chemical membrane tech, raised $12m in Series A funding. SOSV led, and was joined by Anji Microelectronics, RealTech Fund, Seeds Capital and EPS Ventures. https://axios.link/3xZlCmE

• Domatic, a San Francisco-based building power and automation system, raised $4m in seed funding led by Brick & Mortar Ventures, with participation from Catapult VC, Alchemist and Third Sphere. 

• Inarix, a Paris-based crop analysis platform, raised €3.1m in seed funding from Ankaa ventures, Label Investment, Newfund, Alliance for Impact and Resilience. https://axios.link/3ZpAlmz

• Turnspire Capital Partners acquired USG Water Solutions, a Georgia-based provider of water asset management services for small and medium public water utilities, from Veolia North America. https://axios.link/3J2kx3T

• Ameresco, a Farmingham, Mass.-based renewable energy developer, acquired Enerqos Energy Solutions S.r.l., a Milan-based renewable energy and energy-efficiency company. https://axios.link/3kzAR2o

• Baytex Energy agreed to buy Ranger Oil, a Houston-based E&P focused on the Eagle Ford shale in South Texas, for $2.5b in cash and stock. https://axios.link/3xZaBSk

• Unfold, a Davis, Calif.-based vertical farming company, partnered with GoodLeaf Farms, Canada’s largest commercial vertical farm, to commercialize vertically farmed spinach and other leafy greens through Unfold’s Innovation Partner Program. https://axios.link/3Z2i0fs

• Excelerate Energy agreed to purchase 0.7 million metric tons per annum of liquefied natural gas on a free-on-board basis from Venture Global LNG's facility in Plaquemines Parish, Louisiana. The deal is part of a 20-year purchase agreement between the two companies. https://axios.link/41xRNqF

4. Hot deals

• Xylem, a water technology company, appointed ABM Industries CFO Earl Ellis to its board of directors. https://axios.link/3mbXLgU

• Westinghouse appointed Dan Sumner to president of its operating plant services business unit following the departure of Sam Shakir in the same role. Shravan Chopra was promoted to fill Sumner's previous role of CFO. https://axios.link/3KKcIkE

• Zymtronix, a biotech manufacturing company, appointed former Novozymes EVP Thomas Videbaek to its board of directors. https://axios.link/3y0uJTY

• Ross Gerber dropped his short-lived bid to join Tesla's board of directors, per The Information. https://axios.link/41v3Y7R

5. It's personnel

🌾 The snow and frost didn't kill all of Megan's weeds. If anything, she thinks it made them stronger and more spiteful.

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 fighter pilots.

February 28, 2023

1 big thing: Air Company lands Air Force deal