The Impact Innovator | Issue 294
In this week's The Impact Innovator edition:
India’s Adani Group announced more development of renewable energy, with the company on Dec. 27 saying its Adani Green Energy arm has received $300 million for the transfer of a 1,050-MW clean energy portfolio as part of a joint venture (JV) with France’s TotalEnergies.?The announcement Wednesday came one day after Adani, led by billionaire Gautum Adani, said shareholders would back a $1.12 billion investment in solar, wind, and other clean energy projects, as part of a continued effort to reduce India’s reliance on fossil fuels. Adani Energy Solutions, an Adani subsidiary, on Wednesday announced plans to spend $360 million to build a transmission line to connect a major wind and solar power installation in western India to the power grid.
Adani also Wednesday announced a deal with a United Arab Emirates (UAE) group, an agreement aimed at growing Adani’s smart meter business both in India and globally.Adani Green Energy, India’s largest renewable energy developer, in a news release Wednesday said TotalEnergies as part of a JV is acquiring a 50% stake in projects developed by Adani Green Energies Limited (AGEL), an Adani subsidiary. The company said the transaction will support its goal of deploying at least 45 GW of renewable energy generation capacity by 2030. Adani Green said it is now “fully equipped” to hit that target; the company at present has about 8.4 GW of operating renewable energy generation capacity.
LG Energy Solution Vertech has lined up 10 grid-scale battery energy storage (ESS) projects in the United States that will provide 10 gigawatt hours of storage to support the adoption of renewable energy and grid resilience.?The new ESS systems will incorporate lithium-ion batteries along with hardware integration and system controls software, including the company’s?AEROS cloud, altogether diverting about 16 million pounds of carbon emissions each year, LG Energy Solution said. Energy storage systems are a valuable element of grid decarbonization as renewable energy sources often generate more energy than demand requires at a given time.?Battery storage?may keep this energy from being wasted and support the grid when renewables are experiencing lower rates of energy generation.
In order to continue contributing to the U.S. energy storage market’s growth, LG Energy Solution will also construct a battery manufacturing plant in Queen Creek, Arizona, where electric vehicle batteries and lithium iron phosphate batteries used for ESS will be produced. The facility will reportedly produce 16 GWh worth of energy storage batteries.?The company said the immense growth that the U.S. energy storage industry experienced in 2023 played a role in the plans, with an expected 35% increase in capacity during the year. In 2024, the grid-scale ESS market is expected to reach 30 GWh total.
Pattern Energy has secured an $11bn non-recourse financing deal for the SunZia clean energy project, which includes SunZia Wind and SunZia Transmission.?The SunZia Wind facility, with 3.5GW of power generating capacity, is being built across Torrance, Lincoln, and San Miguel Counties in New Mexico.?The wind farm will be paired with SunZia Transmission, an 885km-long, 525kV high voltage direct current (HVDC) line with 3GW of transmission capability.?The line will be laid between central New Mexico and south-central Arizona.
The financing package includes various facilities such as an integrated construction loan, a letter of credit facility, and innovative tax equity term loan facilities. The financing for the construction and term facilities, amounting to about $8.8bn, was provided by a consortium of international banks including?BNP Paribas, Crédit Agricole Corporate and Investment Bank, and MUFG Bank, among others. These institutions also acted as initial coordinating lead arrangers and joint bookrunners. The financing also includes a $2.25bn in tax equity term loan facility. It was provided by?Banco Santander?and Santander Bank, with additional support from?Bank of America, GE Vernova’s Financial Services business, and others. This facility has been designed to monetise the project’s tax credit attributes. Nomura Securities International and CPPIB Credit Investments III, a subsidiary of?Canada Pension Plan Investment Board?(CPP Investments) also provided initial equity capital for the project.
This week brings the recent news that energy platform?Lumian?has raised $3.2 million in its first funding round.?Lumian was established in April 2023 by Turkish entrepreneurs Batu Balk?r and Emre Birol and quickly flipped up its headquarters to the United States.??The company has developed an IoT-based SaaS platform incorporating AI to provide deep insights into energy provisioning, bill analysis, and energy efficiency.??Lumian analyses companies' energy consumption patterns and offers optimal business tariff options. Integrated with various industrial devices and Automated Meter Reading Systems (AMRS), the startup empowers facilities with efficient energy consumption analysis and optimisation through its SaaS and IoT-powered software.
Its software is up and running in less than five minutes with no additional hardware cost required. It offers comprehensive energy management services such as real-time energy usage monitoring, billing analysis, verification, tariff recommendations, regulation notifications and detailed reporting. In addition, IoT-enabled software enables custom device tracking in scenarios involving hardware costs. Its customers include Turkish companies such as Pakmaya, Tebplast-Rosti, Polmar, Balorman, Gen?ler Kablo, and Ba?o?lu Kablo. Operating in Turkey and Germany, Lumian aims to increase its sales volume in global markets with the new investment from DOMiNO Ventures and energy sector expert ?smail Ferhat ?zlü.?
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As we step into 2024, a series of environmental and sustainability challenges await us. From intensifying debates over Environmental, Social, and Governance (ESG) policies to the impending legal battles against financial firms championing net zero emissions, the terrain of sustainability is set to be contentious.
The Battle Over ESG Policies
Republicans are escalating their scrutiny on asset management firms, employing tools like subpoenas and lawsuits. This surge happens despite an apparent voter indifference, marking a sharp contrast in the political arena. In response, a new campaign is set to invigorate support for corporate climate action. However, states leaning red plan to resist ESG considerations, setting the stage for possible legal confrontations. One such example is a looming Tennessee lawsuit against BlackRock, and potential antitrust allegations against financial firms advocating for net zero emissions.
Climate Disclosures: A Global Challenge The U.S. Securities and Exchange Commission (SEC) is on the verge of a significant decision: to finalize rules on climate disclosures by publicly traded companies. The focus is on Scope 3 emissions from supply chains. This move comes as global corporate climate disclosure standards are in flux. California’s new law has sparked similar proposed measures in New York and Washington, while the EU is implementing its own regulations.
Firefly Green Fuels, a UK-based company, has developed a new form of jet fuel that is entirely fossil-free and made from human waste. The company worked with experts at Cranfield University to confirm that the fuel they developed had a 90 percent lower carbon footprint than what is used in aviation today, according to?the BBC. Tests by independent regulators validated that what Firefly Green Fuels has developed is nearly identical to standard?A1 jet fuel.?In 2021, the company received a ￡2 million grant from the Department of Transport to continue developing its sustainable aviation fuel. Although it’s not yet available commercially,?the company says?it is on track to bringing its fuel to the global market and it will have its first commercial plant operating within 5 years. The company has already inked a partnership with the?budget airline Wizz Air?— the name of the company and the source of its potential combustibles could scarcely be a more perfect pairing — to supply it with fuel starting in 2028.
It currently sources its waste from water companies in the UK and takes the refined sewage through a process called?hydrothermal liquefaction, which converts the liquid waste into a sludge or crude oil. Solid by-products can also be made into crop fertilizer. The company claims that the?carbon intensity?of the whole process — which measures how much carbon is needed to produce energy — is?7.97 grams?of carbon dioxide per megajoule (gCO2e/MJ). Comparatively,?the ICCT says?carbon intensity recorded for jet fuel ranges from 85 to 95 gCO2e/MJ.?Organic matter, as the?company points out, takes millions of years to develop into the fossil fuels that power cars and planes. Firefly’s solution makes it possible to generate fuel in a matter of days — and more importantly, human waste is a widely available resource. It's unclear if sustainable jet fuel will be more or less expensive than what is currently available.
Seattle-based startup Evrnu has broken ground on a cotton recycling facility in South Carolina. By the end of 2024, the facility—which will run mostly on renewable energy—should be operational. It will be able to produce enough T-shirts annually, or 80,000, from recycled cotton apparel.?The CEO and founder of Evrnu, Stacy Flynn, patented the NuCycle technique. A solid cotton is reduced to a pulp by the patented process, which then reconstitutes it into fibres for new clothing. The clothes are first sorted by a grading machine to determine which ones are most likely to be made entirely of cotton; the remaining items are then thrown out for conventional downcycling.?According to Evrnu, the end product is a high-quality fabric that is entirely recyclable and constructed of recycled cotton, performing similarly to virgin cotton.
Together with Pangaia, Evrnu is creating a denim jacket that is entirely composed of recycled cotton. Pangaia collaborates with and invests in other textile firms that are comparable to Evrnu in addition to selling hoodies, coats, shoes, and T-shirts created with its own sustainable alternatives, such as seaweed, eucalyptus, and grapes. Pangaia desired a product that could be fully recyclable and was made entirely of recycled materials. Due in large part to the dyeing process, denim is one of the most intricate and difficult textiles to recycle, which is why designers chose it.?The company has also collaborated with fashion retailer Zara to create a capsule collection using its NuCycle technology. According to Flynn, Evrnu has volume commitments worth US $ 500 million from retailers and brands—none of which are yet public. She stated that as the business grows, the cost of recycled cloth would begin to decrease.
SpaceX has started the new year with a bang, launching 21 Starlink satellites on its Falcon 9 rocket on Tuesday night. The launch, which took place from Vandenberg Space Force Base in California, marked the debut of the direct-to-cell (DTC) feature on six satellites.?The DTC feature will allow mobile phones to connect directly to the Starlink satellites without ground infrastructure. This will enable users to access voice, text, and data services anywhere, even in remote areas or disaster zones.
Earlier, SpaceX was?granted permission?by the US Federal Communications Commission (FCC) to conduct a pilot project for its Starlink mobile service. The project will test the use of satellites to provide internet access to smartphones across the US using T-Mobile's spectrum to send data to unmodified phones on the ground via?Starlink satellites.?The FCC granted SpaceX an "experimental special temporary authorization" for 180 days, or until June 14 next year, with the approval coming a week after the company received a partial nod to deploy the Starlink mobile service. However, the initial approval restricted SpaceX from doing any other testing besides checking the functionality of the satellite antennas. SpaceX said in a statement that the DTC feature would “enable mobile network operators around the world to provide seamless global access to texting, calling and browsing… on land, lakes or coastal waters.” Musk and T-Mobile’s CEO and President, Mike Sievert, announced the partnership between the two companies in August 2022. Sievert said that the upcoming service in the U.S. would use the existing T-Mobile mid-band PCS spectrum, which was already compatible with most phones in the market.
Exciting! How do you envision the impact investing landscape evolving in 2024, especially in terms of climate finance and ESG, Joshua Soloway?