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BFD Expert Voices - Climate Deals

BFD Expert Voices

🛢️ What we're watching: Big Oil is asking former President Trump's campaign to spare key parts of the IRA that provide incentives for carbon capture, hydrogen and clean fuel.

There's plenty of methane to harvest from landfills, farms, and industrial sites, if only there was a cheap way to bring it to market. 

Why it matters: Capturing the potent greenhouse gas is one thing — figuring out how to transport it efficiently is another.

State of play: A number of companies are working to make fuel from the methane emitted by landfills, industrial sites, and decomposing harvest leftovers. 

Stunning stat: Municipal landfills alone are the third-largest methane source in the U.S.

Yes, but: Methane is typically turned into fuel off-site — meaning companies need to build prohibitively expensive pipelines or compressor systems. 

Driving the news: Biofuels startup Emvolon has raised $10.5 million to use automobile engines to turn methane into liquid fuel on-site. 

The company says the approach solves one of the toughest challenges facing biofuels production.

How it works: Emvolon's container-sized system is built around a modified automobile engine, which converts methane into synthesis gas, and then synthesis gas into methanol.

"By using an engine, it's already being mass produced, it's on a skid in a portable container that can be placed on-site," CEO Emmanuel Kasseris tells Axios.

The latest: The Woburn, Mass.-based company this month signed an agreement with biogas developer Montauk Renewables to install a demonstration methanol production system at a landfill in Humble, Texas.

Emvolon also received a competitive $2.3 million ARPA-E grant in July from the Department of Energy. 

What's next: Emvolon expects this month to begin laying the groundwork for its Texas system, with initial annual capacity of 15,300 gallons anticipated next year.

The system has the ability to expand to a commercial-scale system producing 2.4 million gallons annually.

Methane liquidity 

Illustration of a gas can with a dollar sign etched on the side. 

Mining giant Rio Tinto is in talks to acquire lithium miner Arcadium.

Why it's the BFD: The potential deal shows the long-term growth for the EV battery metal, as well as interest in emerging, more efficient technology.

Zoom in: The deal, first reported by Reuters, values Arcadium between $4 billion to $6 billion or higher. Arcadium confirmed the talks.

The acquisition would make Rio Tinto the third largest global producer of lithium, behind Albemarle and SQM.

Arcadium has developed "direct lithium extraction," technology, or DLE, which enables miners to extract lithium from brines more efficiently.

Arcadium, which counts automaker customers Tesla, BMW and General Motors, saw its shares jump 40% to around $4 per share since news of Rio's interest surfaced.

Catch up quick: Arcadium was formed late last year by the merger of Australian lithium producer Allkem and U.S. mining firm Livent.

The lithium market has seen crashing prices over the past couple of years, partly due to oversupply in the market.

But low prices mean attractive deals for lithium majors betting on long-term growth.

The big picture: The global transition to EVs might be happening more slowly than expected in some markets, but demand for lithium is expected to soar over the long term.

DLE isn't yet a commercial technology, but it could be a game changer for lithium miners and the EV sector.

The Arcadium deal demonstrates that DLE is an attractive asset for traditional lithium majors.

The BFD: Digging around 

Illustration of Benjamin Franklin wearing a miner's helmet with the light on. 

German startup Purpose Green closed a $15 million seed round to decarbonize multiunit residential and commercial buildings.

Why it matters: Buildings and construction alone generate nearly 40% of global emissions.

How it works: Purpose Green promises to slash those energy bills by providing green-energy retrofits. 

The startup is taking the unusual approach of blending consulting, software development and construction management.

Driving the news: The round was led by Fifth Wall. Atlantic Labs and Speedinvest were also part of the round, which closed in June. 

Flashback: The round adds to the €3.3 million that Purpose Green raised last year.

Zoom in: Fifth Wall partner Miguel Nigorra joined the startup's board.

What's next: Purpose Green is working in about 700 buildings, most of which are comprised of six or more units. 

The company is eyeing a U.S. expansion, "but for now our strong focus remains on Germany," a spokesperson tells Axios.

Green building exclusive

Illustration of an energy lightning bolt in a glass display case.

🛬 Air taxi turbulence: German eVTOL developer Lilium said it "immediately requires additional capital to continue to finance its ongoing operations," per Sifted.

The warning came barely five months after the startup raised $114 million from investors including Atomico, Earlybird Venture Capital and Tencent. It went public via SPAC in 2021.

💼 Kerry joins Galvanize: Former Secretary of State John Kerry has joined billionaire Tom Steyer's climate-focused venture firm, Galvanize Climate Solutions, as co-executive chair.

The position will include "originating differentiated opportunities and leveraging firsthand knowledge as to how technology, policy, and geopolitics are shaping the energy transition," per a press release this morning.

💵 EV financing: Rivian Automotive has applied for a federal loan to support construction of the company's planned EV plant in Georgia, per Bloomberg.

Rivian is hoping to bring the plant online by Q3 2027. The filing to the Energy Department did not disclose the amount of the sought-after loan.

🇸🇦 Saudi's H2 play: Saudi Arabia's sovereign wealth fund, The Public Investment Fund (PIF), has created a company called Energy Solutions Co. to finance green hydrogen projects with at least $10 billion, reports Bloomberg.

Some investments will be made with state oil giant Aramco, says the report.

Cord Landsmann, former CEO of Thyssenkrupp Uhde, is expected to lead the company.

The new venture could be announced as soon as this month.

Temperature check

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

• EnergyX, a San Juan, Puerto Rico-based lithium extraction tech developer, raised $75m from retail investors, per TC. Go deeper

• Entosystem, a Canadian fly farmer for fertilizer and animal-feed production, raised C$58m led by Idealist Capital, Sanimax and Fondaction. Go deeper

• Submer, a Spanish sustainable data center developer, raised $55.5m led by M&G, joined by Mundi Ventures and insiders Planet First Partners and Norrsken VC. Go deeper

• French plant-based pork and deli meats producer La Vie raised €25m from Zintinus, Sparkfood and crowd-funders. Go deeper

• Voliro, a Swiss drone-inspection provider for industrial sites, raised a $12m Series A led by Cherry Ventures. Go deeper

• Voltfang, a German energy storage maker, raised an €8m Series A led by Forward.One, joined by Interzero and insiders PT1, Aenu, Helen Ventures, Daphni, Aurum Impact and Maximilian Viessmann. Go deeper

• SuperNode, an Irish developer of superconducting cable systems, raised €8m from Volnay and Aker Horizons. Go deeper

• Grounded, a Detroit startup configuring electric vans, raised $3.5m in pre-seed funding led by Also Capital and The 81 Collection. Go deeper

• Paren, an SF EV software developer, raised $3m led by Base10 Partners, joined by Founders Network Fund. Go deeper

• New Frontier Aerospace, a Tukwila, Wash., aerospace tech developer, including sustainable aircraft, received an undisclosed seed investment from Pacific Bays Capital. Go deeper

• BrightNight, an NYC renewables developer and operator, closed a $440m equity investment from Goldman Sachs Alternatives. Go deeper

• Monolith Materials, a Lincoln, Neb., hydrogen and carbon black producer, announced an undisclosed investment from Azimuth, Cornell Capital, Decarbonization Partners, TPG Rise Climate, and Warburg Pincus. Go deeper

• Blackstone-backed Power Grid Components acquired Vizimax, a Canadian developer of high- and medium-voltage electric power measurement, control and switch systems. Go deeper

• Equinor bought a 9.8% stake valued at ~$2.5b in Orsted, making the Norwegian energy giant the renewables developer's second-largest shareholder after the Danish government. Go deeper

• Veralto, a Waltham, Mass., water tech company, acquired TraceGains, a Broomfield, Colo., software developer, for $350m. Go deeper

• Simulate, parent of the plant-based meat alternative brand Nuggs, is being acquired by Ahimsa Companies, per our Axios Pro colleague Richard Collings. Go deeper

• SLR, a London sustainability services provider, acquired NYC ESG consulting firm Malk Partners. Go deeper

• Bankrupt EV maker Fisker is under SEC investigation, per TC. Go deeper

• BP dropped its plan to reduce oil and gas production by 2030, per Reuters. Go deeper

• Thyssenkrupp said it's reevaluating its green steel production plans. Go deeper

• American Water Works, a Camden, N.J., utility supplying drinking water and wastewater services to 14m people, disclosed that hackers breached its computer networks, per Bloomberg. Go deeper

Hot deals

• George Burdette was named CFO of Verde Clean Fuels, a Houston syngas-to-gasoline producer. Burdette was previously CFO of Arbor Renewable Gas. Go deeper

It's personnel

🏊🏻‍♂️ Katie and family found refuge from scorching temperatures at the beach and a pool.

🍷 Alan ate way too much round challah during Rosh Hashanah this year. 

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

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

October 07, 2024

1 big thing: Methane liquidity