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BFD Expert Voices - Climate Deals

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Scooter company Lime has committed to using electric port trucks to move its goods that are imported into North America, the company exclusively tells Axios.

Why it matters: Consumer brands with aggressive net zero goals want suppliers to offer electric vehicle shipping options, writes Katie.

Port trucks will be some of the first large trucks to go electric.

Zoom in: Lime is working with Hight Logistics, a mid-sized logistics provider at the Ports of Los Angeles and Long Beach, that is Forum Mobility's first customer.

Hight currently operates six electric trucks with 14 more arriving in the coming months. Forum built out Hight's charging infrastructure and owns some of its vehicles.

Hight's electric trucks will pick up about 300 of Lime's shipments per year and move them to local distribution centers.

Lime's VP of sustainability Andrew Savage said the company pays the same price for the zero-emission drayage services as it would for diesel-powered shipping.

Zoom out: Uber Freight, Uber's logistics arm, commissioned a survey that found that shippers would routinely opt for an electric option if they didn't have to pay more, says Chinmay Jaju, Uber Freight's senior manager for strategy and business development.

The big picture: Policy is another lever driving the electrification of trucks for shipping.

California has mandated that all trucks operating out of the Ports of Los Angeles and Long Beach need to be zero emission by 2035.

The port rules will help the state meet its climate change goals but also clean up the air for communities that live around the truck routes.

Earlier this week the Biden administration released a national strategy to speed up the deployment of charging infrastructure for zero-emission freight trucks.

Investors have also begun committing to the electric port truck transition.

Last year, Forum Mobility raised a $400 million infrastructure fund from an affiliate of commercial real estate services and investment firm CBRE Group and Homecoming Capital.

In early 2022, BlackRock's Renewable Power Group joined with Daimler Truck North America and NextEra Energy Resources with a $650 million fund to deploy charging infrastructure for zero-emission trucks.

What's next: Expect more big brands to opt for electric port truck shipping as word spreads that they don't have to pay extra.

"No one's going to make the wheels of zero-emission trucks move faster than the cargo owners," says Forum Mobility CEO Matt LeDucq.

1 big thing: Brands eye electric shipping

Electric drayage trucks operated by shipping company Hight Logistics in Southern California. The charging infrastructure and some of the trucks are owned by Forum Mobility.

Electric drayage trucks operated by shipping company Hight Logistics in Southern California. The charging infrastructure and some of the trucks are owned by Forum Mobility. Image courtesy of Hight Logistics

Electric automaker Fisker has hired restructuring advisers for a potential bankruptcy, WSJ reported yesterday evening.

Why it's the BFD: The Manhattan Beach-based company last month reported $273 million in sales and about $1 billion in debt, Alan writes.

Zoom in: Fisker has hired financial adviser FTI Consulting and law firm Davis Polk for a possible bankruptcy filing.

Fisker and FTI declined to comment. Davis Polk did not immediately return a request for comment this morning.

Fisker was founded by former BMW and Aston Martin designer Henrik Fisker, who remains its chairman and CEO.

Fisker was among a raft of EV startups that went public via SPACs in 2020 — deals that have seemed to sour ever since.

The company struggled to nail down a sales strategy, swinging from direct-to-consumer to working with dealerships. 

It also took an unusual approach to production, hiring a contract manufacturer in Austria instead of building the cars itself. 

What we're watching: Reuters this month reported that Nissan was in talks with Fisker about a potential $400 million investment. Nissan this morning declined to comment. 

2. The BFD: Fisker said to near bankruptcy No. 2

Illustration of an electric bolt wobbling atop a cliff

The U.S. Energy Department this morning announced a $2.26 billion conditional loan commitment to a Lithium Americas subsidiary to develop a lithium extraction project in Nevada.

Why it matters: The Thacker Pass mine would be North America's largest source of lithium for electric vehicles and other battery devices, Alan writes. 

State of play: Lithium Americas started construction on the mine in northern Nevada last year. 

It received a $650 million investment in January 2023 from General Motors, which has agreed to buy battery-grade lithium carbonate from the site. 

The estimated cost of the mine has climbed to nearly $2.93 billion from $2.27 billion last year.

Context: Some Native American tribes in the region oppose the project. Thacker Pass was the site of an 1865 massacre of Native Americans by U.S. soldiers.

Conservationists have also sought to block the project.

Lithium Americas in 2022 signed an agreement with the Fort McDermitt Paiute and Shoshone Tribe to fund infrastructure improvements and provide job training and employment opportunities, the Energy Department says.

What's next: The loan offer from the agency's Loan Programs Office is for Lithium Americas subsidiary Lithium Nevada.

Lithium Nevada will need to meet certain technical, financial and other conditions before it can receive the loan via the agency's Advanced Technology Vehicles Manufacturing Loan Program.

The project also faces a potential lengthy review under the National Environmental Policy Act. 

Separately: The Energy Department made two other announcements yesterday: $750 million in funding for 52 hydrogen projects, and a conditional $72.8 million partial loan guarantee for a solar-plus-storage microgrid on Tribal lands of the Viejas Band of the Kumeyaay Indians near Alpine, Calif.

3. DOE advances $2.3B for Lithium Americas mine

Illustration of a mining cart full of batteries.

Steel tech startup Allium Engineering has closed a $3.25 million seed round to start producing its rebar, the company told Katie.

Why it matters: Climate change and failing infrastructure are driving demand for longer-lasting, lower-carbon construction materials, writes Katie.

Zoom in: Allium raised the round from lead investor Propeller, Aera VC, Greatwave Ventures, and Anthropocene Ventures.

The Somerville, Mass.-based startup will use the funds to get a new facility operating in Boston by this July, with a goal of producing over a thousand tons of stainless steel-coated rebar within the next two years.

Allium says its steel products can extend the lifespan of infrastructure like bridges from 30 years to over 100 years and avoid significant carbon emissions by extending time between maintenance and repairs.

The company's steel rebar will be used in a planned bridge construction in Walton County, Fla., and a planned sea wall in Key West.

How it works: Allium, founded in 2022, coats customer steel with a stainless steel layer, which keeps the metal from corroding.

A steel maker can stretch a coated unfinished block out into rebar, or other steel products, with the coating remaining intact and protective.

Allium's co-founder and CEO Steven Jepeal says, "The idea is, we want it to be identical to normal rebar, but last forever."

Cladding steel with Allium's stainless steel coating adds cost to the rebar production process, but Jepeal says the extra cost is much less expensive than other protective solutions like epoxy-coated rebar or fully stainless steel rebar.

State of play: Investing in lower-carbon steel has been a surprisingly hot area of investment, but much of it has been focused on using new processes and clean energy to make steel.

The bottom line: Longer-lasting, lower-carbon infrastructure is a key technology as the climate changes, storms become more intense, and sea levels rise.

4. ICYMI: Allium raises $3.25M for resilient steel

The founders of startup Allium, CEO Steven Jepeal, [L] and CTO Samuel McAlpine [R] standing behind their stainless steel coated rebar. Image courtesy of Allium.

The founders of startup Allium, CEO Steven Jepeal, left, and CTO Samuel McAlpine. Image courtesy of Allium

😬 Solar snub in Europe: The EU won't change subsidies to support solar manufacturers there that are struggling to keep pace with ultra-cheap imports from China, per Politico.

Solar manufacturers in Europe say they'll soon lay off as many as 4,000 workers. European Commission officials told manufacturers in a closed-door meeting that they won't act without further support from EU governments.

🔌 Spiking electricity demand: Surging demand for electricity in the U.S., particularly the South, to power a combo of cleantech manufacturing, data centers and EVs, are causing some utilities to propose building a wave of natural gas plants.

The surge in fossil fuel power plans threatens to thwart the Biden administration's climate goals.

📉 Shell weakens emission goal: Shell is easing one 2030 climate goal and scrapping a 2035 target, but adding a new one for emissions from customer use of oil products, Axios Generate's Ben Geman writes.

Oil majors are juggling climate pressure and strong fossil fuel demand, while seeking low-carbon markets where they're competitive.

5. Temperature check

Illustration of an ice cream cone with a melted puddle of ice cream that looks like the earth.

• Elaia, a French VC firm, raised €60m toward a targeted €120m deep-tech seed fund, per TechCrunch. https://axios.link/3v2Dxeq

• Ocient, a Chicago-based data analytics provider focused on big data consumers, added $49.4m to its Series B, bringing the round's total to $119m, per Latitude Media. https://axios.link/4acv3Ad

• Furno, a Mountain View, Calif-based low-carbon cement company raised $6.5m led by Energy Capital Ventures and joined by O'Shaughnessy Ventures, Cantos, and Neotribe. https://axios.link/3v7CPMV

• Dodai, an Ethiopian EV startup, raised $4m in Series A funding from Nissay Capital, Musashi Seimitsu and Inclusion Japan. https://axios.link/43jzqr6

• Earthshot unveiled a startup and investor matchmaking site, Launchpad, meant to connect Earthshot finalists with funders. https://axios.link/3TASFZM

• KKR has offered to buy listed German electricity provider Encavis for €2.8b. https://axios.link/3Vd6fnt

• PowerGem, a Clifton Park, N.Y.-based simulation software provider for the electric power industry, received an undisclosed investment from TA Associates. https://axios.link/3VjwU22

• Surf Beyond, a Norwegian scooter provider, acquired bankrupt Cambridge, Mass.-based scooter Superpedestrian's European business for ~€5m, per Sifted. https://axios.link/4adNLaq

• HeavyFinance, a Lithuania-based marketplace that connects investors with European farmers, is raising €50m for a private credit fund, anchored by €20m from EIF to decarbonize farming in Bulgaria, Latvia, Lithuania, Poland and Portugal. https://axios.link/43pdoTF

• California will need to triple its annual carbon emissions reductions to meet a 2030 target of cutting emissions by 40% from 1990 levels, per a report from consulting firm Beacon Economics. https://axios.link/3IxKN57

• Boulder-based Radia is building an enormous airplane big enough to transport wind-turbine towers, per WSJ. https://axios.link/3TxvPSK

• Lilium, a German electric aircraft developer, announced a deal with Atlantic Aviation, Plano, Texas-based operator of private aircraft terminals, to prepare Atlantic's network for Lilium's eventual service launch. https://axios.link/49VbOvo

• UK-based Aerovolt launched what it's calling the world's first charging network for electric aircraft. https://axios.link/4c9hDXz

• Keurig Dr Pepper plans to begin testing compostable coffee pods free of plastic and aluminum this fall. It's using tech licensed from Delica Switzerland. https://axios.link/4ab00Vw

6. Hot deals

• Stephen Faulkner was named VP and chief accounting officer at Vital Energy. https://axios.link/3x3CmM4

• Sanjay Kumar was named CEO for Hartek Group's power and renewable infrastructure business. Kumar was formerly with TATA Power and L&T. https://axios.link/4af13np

7. It's personnel

🍹 Sip of the week: The "Khao San Rd.," submitted by Inspiration Mobility's Loretta Prencipe. It's got Tito's, lavender lemon syrup, lime and Thai tea — and it's on the menu at Dok Khao in Columbia, Md. 

🍠 Katie made sweet potato tacos last night.

🚧 Alan will be keeping an eye on a press briefing in Rhode Island this afternoon, where state officials will finally share the results of a structural analysis of the Washington Bridge, which links the eastern slice of Rhode Island with the rest of the state. 

Officials abruptly shut down the bridge Dec. 11 after finding a critical structural failure — adding 30+ minutes to Alan's (already not-short) drive to and from the kiddo's day care on the other side of the bay.

Thank you to Michael Flaherty, George Moriarty, and Chris Speckhard for today's edits. (And, George, for yesterday's, too.)

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

March 14, 2024

1 big thing: Brands eye electric shipping