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BFD Expert Voices - Climate Deals

BFD Expert Voices

Artificial intelligence, as both a climate tool and culprit, dominated many of the discussions at SF Climate Week last week, Katie reports from the event.

Why it matters: The looming electricity demand of generative AI models is threatening grid stability. And yet, AI can also help solve that problem.

What they're saying: "The way this technology is moving is infinitely faster than the way that utilities move and plan for infrastructure," said Brian Janous, former VP of Energy for Microsoft, and co-founder of Cloverleaf, a new startup helping computing companies access energy.

The main reason the clean electricity surge might not materialize as quickly is because utilities might not be able to build capacity fast enough, said Janous.

Zoom in: At the same time, so-called predictive AI, which can make infrastructure run more efficiently, could help grid operators access more capacity and reduce the time it takes to simulate grid scenarios.

Page Crahan, general manager for Tapestry, Google X's moonshot project for the electric grid, said it's using AI to help utilities run grid simulations and make decisions much more quickly.

"We're wondering if AI can make the grid instead of breaking the grid," said Crahan during a session last Thursday.

Driving the news: The Department of Energy released a report today and a series of initiatives on how a clean-energy build-out could leverage AI.

Our colleagues on Axios Generate dug into the utility data center conundrum on Friday.

By the numbers: At a Salesforce summit on AI at the event last week, Juliet Rothenberg, product lead of climate AI for Google, said it's important to keep in mind the numbers around AI and energy.

Electricity use for data centers has been holding steady at about 1% (of global electricity) for quite some time, said Rothenberg.

Somewhere in the ballpark of 25% of global electricity use for data centers is AI. So that's 0.25% of global electricity use, said Rothenberg.

"If you look on a greenhouse gas basis, hyperscalers are responsible for about 0.1% to 0.2% of global greenhouse gases," said Rothenberg.

The big picture: Computing companies are asking utilities for an unprecedented amount of new clean electricity for training AI models.

But grid operators could also use AI tools to help meet that demand surge.

1 big thing: AI and the grid at SF Climate Week

Illustration of a robotic hand holding a glowing dollar sign.

Pine Gate Renewables, a developer of large solar and energy storage projects, closed a $650 million round led by Generate Capital, the company announced this morning.

Why it matters: That's a whole lot of dough to build more renewable energy projects, Alan writes.

The big picture: The equity investment closed April 16, concluding a raise that began late last year, a Pine Gate spokesperson tells Axios.

Generate was an existing investor in Pine Gate. The Healthcare of Ontario Pension Plan and Australian fund HESTA joined as new investors in the company.

How it works: Pine Gate has developed about 2 GW of utility-scale solar and storage projects in the U.S. The Asheville, North Carolina-based company has another 30 GW of projects in development.

This latest investment will support financing to build about 3 GW of projects through 2025.

2. The BFD: Pine Gate's next $650M

Illustration of rows of solar panels with abstract shapes and money elements.

Investors and founders are sprinting to meet surging energy demand from data centers. But "most things take more time and cost more than you think," Kayode Akinola tells Alan.

Why it matters: Akinola is head of private equity at Blue Earth Capital, a climate-focused impact investor.

"Focus on execution," Akinola says. "There are a lot of great ideas, a lot of great products, but scaling them successfully is the challenge. Give yourself enough time and buffer to build what you have a vision for."

What's been the big news this month in climate-tech?

"The sheer escalation of energy demand. That's by and large a result of electrification. It's accelerated by artificial intelligence. It's been ongoing for a while, but it's coming to a head with increasing appreciation of how much energy is required."

"It's driving demand for clean electrons to power and cool these data centers. That requirement, and the speed that's needed, is pushing the debate to focus on solving intermittency issues for renewables and making data centers more efficient."

"It's one thing to find places to store the data and process it, and another thing to generate the electrons — but how do you get the electrons to the data centers to power them?"

"I don't think it's undernoticed, but it's not something everyone has been that focused on, because you sometimes take the grid for granted when in fact it needs significant upgrades."

💼 First job: "I worked for a hi-fi retailer on the shop floor demonstrating and selling hi-fi setups."

👑 Proudest investment: "Helping catalyze private companies. I'm not sure how many people are out there trying to support climate at this point. And the types of investments are important: those that are able to demonstrate real returns with measurable impact."

🤦‍♂️ Facepalm investment: "I would've liked to have not missed the wave of data centers before they were super hot."

💡 In three-ish words, one change you'd make to climate-tech investing: "More widespread knowledge. How important this is, and also how profitable it can be. It's that combination that's going to mobilize more capital."

3. Expert voices: Speaking of AI and the grid

Photo illustration of Kayode Akinola surrounded by abstract shapes.

Photo illustration: Gabriella Turrisi/Axios. Photo: Courtesy of Blue Earth Capital

Major airlines are uniting to defend a "sustainable" fuel credit created by President Biden's new climate law, writes Jael Holzman in Axios Pro: Energy Policy.

Why it matters: It's a sign that companies are taking seriously the odds of a GOP victory in November that would threaten the climate law.

Not to mention the credit is going to be helpful for some airliners' climate plans.

Driving the news: More than 40 companies — including American Airlines, JetBlue and United — today are announcing the Sustainable Aviation Fuel Coalition, a group to "advocate for the incentives and policies necessary" to boost production of the now-in-vogue alternative jet fuels.

The coalition also includes Boeing, ethanol trade groups and SAF producer startups like Gevo and World Energy, according to a news release.

Zoom in: The coalition wants to "expand" existing credits for making the special fuel and "secure broad, bipartisan legislation that will rapidly advance" its availability, according to a document included in the announcement of the group.

The announcement doesn't explicitly mention the threat of repeal. But the subtext is clear.

Read the entire story on Axios Pro: Energy Policy.

4. New airline group for jet fuel tax credit

🚲 Ebike boogaloo: The FDNY on Friday filed its first-ever criminal charges against an ebike shop owner for allegedly selling uncertified batteries, per local news outlet The City.

Elsewhere, Ukraine's military is using e-bikes from California's Delfast and Ukrainian company Eleek to quickly maneuver against Russian forces and even tow heavy equipment like anti-tank missiles. 

And in lighter ebike news: Canadian manufacturer DJ Bikes is planning a crowdfunding campaign to build a golf-bag holder to bring ebikes to the links. And pop star Lana Del Rey rode into her recent Coachella performance aboard a Ryvid Anthems electric motorcycle. 

🌏 BYD's global ambitions: The Chinese car giant, which also already makes lithium batteries, solar modules, electric buses, trucks and trains, is also now eyeing AI and software, per FT.

"I don't think people realize BYD's greater ambition is to be an energy ecosystem company," Bridget McCarthy, the head of China operations at hedge fund Snow Bull Capital, told the publication.

🙉 Vroom, vroom: Stellantis is debuting what it's calling a "Fratzonic Chambered Exhaust" system to make loud gas-engine noises from its forthcoming electric muscle car, the Dodge Charger Daytona, Axios colleague Nathan Bomey writes.

The Dodge parent isn't the first to realize that drivers might want fabricated sounds. A company called Borla Performance Industries sells an aftermarket system called Active Performance Sound that allows drivers to dial up fake engine noise for their Ford Mustang Mach-E electric SUVs.

💼 Driving the moos: Harvest Hosts, a network of more than 5,000 small businesses nationwide that host RVers overnight, is hiring an intern to cuddle with cows, Axios Denver's Alayna Alvarez reports.

The company is launching a cow cuddler program this summer for an intern age 18+ who has a driver's license and can travel to Harvest Hosts locations across the U.S. The goal is to hire someone to help train and socialize adult, baby and mini cows, which will become emotional support animals at Harvest Hosts' farm-based locations.

rode into her recent Coachella performance

5. Temperature check

a box of matches that pictures a small outline of the earth and text that reads "Temperature Check"

• Vietnamese billionaire Pham Nhat Vuong said he'll invest another $1b of his own capital in EV company VinFast, per Bloomberg. https://axios.link/3xUF8nF

• Green Energy Park, a Brazilian hydrogen production developer, raised $30m from undisclosed investors. https://axios.link/3QmXCDF

• Swedish electric boat maker X Shore raised €8.5m, including from founder Konrad Bergström. https://axios.link/3y4AbZe

• Shinkei Systems, an El Segundo, Calif.-based developer of more efficient fish-processing tech, raised $6m in seed funding led by Cantos, joined by 8VC, Impatient Ventures, Susa/Humba Ventures, Carya Venture Partners, Ravelin Capital, Red & Blue Ventures, and Undeterred Capital. https://axios.link/3w2Z72Z

• Pure Lithium, a Boston-based lithium extraction tech developer, extended its $15m Series A with undisclosed investments from Ivanhoe Capital and law firm Wilson Sonsini's WS Investment. https://axios.link/4bgmLba

• U.S. Silica, a Katy, Texas-based supplier of silica used in mining, oil and gas development, and other industrial sectors, agreed to be acquired by Apollo for $1.85b cash. https://axios.link/44iVmmA

• NYC-based EnTrust Global acquired Offshore Merchant Partners, a Norwegian alternative investment fund manager focused on the maritime and energy sectors, from Norwegian firm HitecVision. https://axios.link/3UD3ACM

• NextEnergy Capital, a U.K. solar and battery developer, has raised another $265m of a planned $1.5b to $2b fund from a combo of UK and Dutch pension funds. https://axios.link/3JBCXb0

• WEC Energy Group, a Milwaukee-based electricity and natural gas supplier, agreed to acquire 90% of the 300 MW Delilah I Solar Energy Sector in northeastern Texas. https://axios.link/49Zzf5U

• EV startup Fisker is in talks with four automakers interested in buying the company. https://axios.link/3UEbcoL

• Faraday Future, an EV startup based in Los Angeles, has been delisted from the Nasdaq. https://axios.link/49ZAkdY

• Toyota is investing another $1.4b in its Princeton, Ind., plant as it prepares to build a three-row electric SUV. https://axios.link/3JFTDhE

• The U.S. Energy Department is offering up to $20m via ARPA-E for projects to detect emissions from the hydrogen supply chain.

• Unit 4 at Georgia Power's Plant Vogtle nuclear plant entered commercial operation, making the Waynesboro, Ga., plant the largest clean-energy generator in the U.S. https://axios.link/3JF7N2z

• The U.S. National Highway Traffic Safety Administration confirmed it's opened a preliminary investigation into Ford's BlueCruise hands-free driving tech following two collisions involving Mustang Mach-E electric SUVs. https://axios.link/3JCUr6P

• NHTSA also found a "critical safety gap" in Tesla's self-driving Autopilot system, which contributed to at least 467 collisions, including 13 deaths and many more serious injuries. https://axios.link/3wfu4Rs

• The U.S. Department of Justice closed an investigation into Mercedes-Benz and manipulation of diesel emissions tests. https://axios.link/49Zq6dA

• Brightline started construction of what would be America's first true high-speed rail network, a 218-mile stretch connecting LA and Las Vegas with trains reaching 200 mph. https://axios.link/3UAoYIT

• StoreDot, an Israeli fast-charging EV battery developer, and Polestar, the Swedish EV maker, today demonstrated silicon battery tech they said can charge an EV in 10 minutes. https://axios.link/4bgYly0

• Joby Aviation, the Santa Cruz-based eVTOL developer, signed an MOU with Abu Dhabi government agencies Department to develop air taxi services there. https://axios.link/3UBOZay

• Tesla offered a peek at robotaxi ride-hailing in the Tesla app. https://axios.link/44j4veO

6. Hot deals

• Gregg Felton was named sole CEO of Altus Power, a Stamford, Conn.-based C&I solar, storage and charging developer, following the resignation of co-CEO Lars Norell. https://axios.link/3QmVsE3

7. It's personnel

Serve the public trust, protect the innocent, mow the lawn.

That, at least, is the vibe from Electric Sheep's new lawnmower bot, which somehow manages to resemble something from Omni Consumer Products, Alan writes.

State of play: The bot is among a new crop of autonomous mowers that promise to be quieter and gentler on grass, if still expensive.

"They go out, they cut the grass, they dock in a charger, and then they go back out again, depending on when you want them to run," Chris Price, engineering manager for robotics at lawnmower maker Husqvarna, tells Jennifer A. Kingson in Axios What's Next.

No word on whether they also enforce the law.

8. Photo of the day: Halt in the name of the lawn

The Verdie robot from Electric Sheep can handle edging and trimming. Photo: Courtesy of Electric Sheep

📌 Axios is heading to Los Angeles May 5 for the Milken Institute Global Conference, where we'll host an event featuring business editor Dan Primack's interview with WndrCo founding partner Jeffrey Katzenberg. Request an invite to attend here.

⛱️ Katie can't believe there's only a month left of the school year before summer lets out.

🥩 Alan made the second half of his 17-pound brisket this weekend for a belated Passover seder with family. It turned out real well. 

Thank you to Michael Flaherty and Chris Speckhard for today's edits.

And thank you for reading Climate Deals! Please share with your friends, family and the AI among us.

April 29, 2024

1 big thing: AI and the grid at SF Climate Week