🌏 Rivian's green charging scheme #160

Happy Monday!

Electric truck maker Rivian will test out customer willingness to pay for clean energy to power their EVs with a new “green charging bundle.” The company has agreed to purchase electricity from a solar project built on top of a former coal mine in Kentucky, and this model would use a corporate power procurement structure to apply clean energy credits to consumer emissions.

Meanwhile, July 2023 is the hottest month ever recorded. Scientists parse the superconductor excitement and SCOTUS gives the greenlight to Mountain Valley Pipeline construction.

In deals this week, smart EV charging nabs $33M. Mining tech extracts $28M and protein made from micro-algae assembles $19M.

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Rivian, RECs, and emissions reduction responsibility

‘EVs are only as clean as the electricity that powers them,’ the criticism goes. With a slowly decarbonizing grid, Rivian is taking a new approach to greener charging for its customers.

Last week, the EV maker announced a deal to purchase 100 megawatts (MW) of renewable energy from a planned solar project and its intention to sell a “green charging” add-on to Rivian owners based on the electricity generated there.

The details: Rivian committed to buying 100MW from the ~$1B Starfire Mine solar project in Kentucky, which is being built on top of a former coal mine and would be the state’s largest renewables project by capacity at 800MW total (enough to power ~160,000 homes).

The background: Rivian signed onto the UN’s 24/7 Carbon-free Energy Compact in March, becoming the first automaker to set a goal of meeting every kilowatt-hour of electricity consumption with carbon-free energy sources, every hour of every day, everywhere—after calling out the industry for not doing enough to reduce GHG emissions.

The thinking: Rather than using this solar energy to power a manufacturing facility or otherwise offset the company’s Scope 2 emissions (from its direct electricity consumption), Rivian plans to put it toward ‘Scope 3 neutrality’ (zeroing out the indirect emissions from its supply chain and the lifecycle of its EVs) by helping power up to 450 million miles of renewable driving each year and having customers pay for it.

Decoding clean energy commitments

“There’s far too much greenwashing in the system,” Rivian CEO RJ Scaringe said of companies overstating their progress toward renewable energy goals. And that’s due in part to the complexity of clean power procurement.

REC racket

Many companies use renewable energy credits (RECs) to reach their Scope 2 emissions reduction targets. A REC is created for every megawatt-hour of clean energy generated and sold into the wholesale market, which usually notes the type of renewable resource and its location, the date it was generated, the emissions profile of the energy source, and a unique identification number.

REC retailers sell these credits and they can be purchased at any time, making them a convenient way to meet renewable energy commitments. But the credits don’t help bring any new clean energy online, and because these RECs can be bought by companies in one region and applied to their electricity usage in another area, the actual environmental impact is tricky to measure.

PPA parameters

Companies looking to step it up a notch have been opting for power purchase agreements (PPAs), which guarantee offtake at a fixed price in order to make sure new clean energy projects can be built.

*Source:* *US Department of Energy Better Buildings*

These clean power purchases are more complicated to assess and execute because they have to coincide with construction and operation of a specific renewable energy project.
Physical PPAs are typically for on-site projects, where the electricity will flow directly into a company’s facility. With a virtual PPA, a buyer still commits to paying the developer a fixed rate for the clean electricity, but receives RECs that can be applied to Scope 2 emissions anywhere across its footprint while the actual renewable energy from the project gets sold to other customers.

Even as companies bought ~31GW of clean energy through PPAs last year, this avenue remains so complex and costly that buyers are mainly large tech companies. And a 24/7 clean electricity goal, meaning all of the energy used across a company’s operations at all times is actually generated from carbon-free sources, is much more difficult to reach than a 100% renewables pledge, which can technically be met with RECs alone.

Rivan’s approach

Now that Rivian has secured a virtual PPA with the Kentucky solar project, the company plans to sell credits as a “carbon-neutral” add-on to vehicle buyers, rather than use them to offset the company’s electricity usage.

The move chips away at the company’s Scope 3 emissions and enlists the wallets of climate-conscience EV customers to help pay for it. "Eventually this will be bundled with every Rivian sale. To start, this will be a package that’s going to be available with the vehicle," Scaringe said.

A “green charging” bundle could alleviate some emissions guilt for buyers of the popular (and pricey) electric Rivian trucks and SUVs, but this isn’t the first time the company has explored how to resell its carbon reductions. Rivian was also interested in earning Verra carbon credits for its home EV charger, which could then be sold to others looking to offset emissions and generate additional revenue for the company.

Glass half empty: You could view these carbon-neutral products as a company in a capital-intensive business looking to pass costs onto consumers (à la offsets for carbon-neutral flights).
Glass half full: Still, offering customer RECs through a company’s clean power purchases seems more material than the option to buy carbon offsets for individual air travel. On the upside, this model could be a way to bring consumer dollars into the equation of companies backing new clean energy projects.

Deals of the Week (7/24-7/30)

Venture Fundings

🌱 OneTrust, an Atlanta, GA-based a trust intelligence platform including an ESG offering, raised $150M from Generation Investment Management and Sands Capital.

⚡ ev.energy, a London, UK-based EV smart charging platform, raised $33M in Series B funding from National Grid Partners, Aviva Ventures, Wex Venture Capital, InMotion Ventures, Future Energy Ventures, and other investors.

☀️ Bright, a Mexico-city, Mexico-based rooftop solar distributor, raised $32M in Series C funding from the Danish SDG Investment Fund and other investors.

🔋 Iontra, a Denver, CO-based producer of a battery charger microcontroller, raised $29M in Series B funding from Volta Energy Technologies, Riverstone and Flag Asset Management.

⚒️ Plotlogic, a Bowen, Australia-based developer of a hyperspectral imaging technology for mining, raised $28M in Series B funding from Galvanize Climate Solutions, SE Ventures, and Schneider Electric.

🥩 Brevel, a Rehat, Israel-based micro-algae based protein developer, raised $19M in Seed funding from NevaTeam Partners and European Innovation Council.

⚡ Bidgely, a Los Altos, CA-based grid energy data platform, raised $18M in Growth funding from CIBC Innovation Banking.

💨 Dioxycle, a Paris, France-based CO2 to ethylene developer, raised $17M in Series A funding from Breakthrough, Lowercarbon Capital and Gigascale Capital.

⚡ Ampcontrol, a New York City, NY-based EV charging software provider, raised $10M in Series A funding from The Westly Group, Lorimer Ventures, and AngelPad.

⚡ ETCH, a Chevy Chase, MD-based hydrogen from methane decomposition developer, raised $8M in Seed funding from Emerald Development Managers.

⚡ Flipturn, a New York City, NY-based EV fleet charging and management platform, raised $5M in Seed funding from Accel, Background Capital and Comma Capital.

💨 Nuada, a Belfast, United Kingdom-based carbon capture developer using metal organic frameworks, raised $4M in Series A funding from Business Growth Fund.

⚡ Voltpost, a Brooklyn, NY-based EV lamppost charging provider, raised $4M in Seed funding from RWE Energy Transition Investments, Twynam Funds Management, Exelon Foundation, Good News Ventures, and Climate Capital.

🧪 Dispersa, a Laval, Canada-based waste-derived biosurfactants developer, raised $3M in Seed funding from Invest Nova Scotia, Fonds Économie Circulaire, Fondaction, Dragonfly Ventures, Good & Well, and BoxOne Ventures.

🏭 Materials Nexus, a Cambridge, United Kingdom-based net-zero materials platform, raised $3M in Seed funding from Ada Ventures, Carbon1, MD ONE Ventures, The University of Cambridge and other investors.

✈️ Electra.aero, a Manassas, VA-based hybrid-electric, ultra-short takeoff and landing (eSTOL) aircraft developer, raised an undisclosed amount from Statkraft Ventures.

✈️ Electric Power Systems, a Logan, UT-based battery module systems for aircraft, raised an undisclosed amount from United Airlines Ventures.

🧪 Nova Pangaea Technologies, a Wilton, United Kingdom-based biochemical and biofuel producer, raised an undisclosed amount from International Airlines Group (IAG).

Other Fundings

🚗 XPeng, a Guangzhou, China-based EV manufacturer, raised $700M in Post-IPO equity from Volkswagen.

⚡ ChargePoint, a Campbell, CA-based EV charging network, raised $150M in Debt from JPMorgan, HSBC, Citi, and Goldman Sachs.

⚡ Westinghouse Electric Company, a Cranberry, PA-based developer of nuclear reactors and fuel, raised $13M in Grant funding from The UK Government.

Exits

🏠 Kiona, a Trondheim, Norway-based energy optimization for building operations platform, was acquired by CAREL for an undisclosed amount.

📦 Ecopol, a Capannori, Italy-based water-soluble technology for packaging provider, was acquired by SK Capital for an undisclosed amount.

New Funds

DCVC, a San Francisco, CA-based investment firm, announced $1B in fresh funding to invest in deep tech companies.

Main Sequence, a Sydney, Australia-based investment firm, announced a first close of $303M for its third fund investing in deep tech.

Energize Capital, a Chicago, IL-based investment firm, announced the close of its $300M second fund investing in climate software companies.

United Ventures, a Milan, Italy-based investment firm, announced the launch of its new fund with a target fund size of $166M to invest in startups tackling sustainable development.

A/O Proptech, a London, UK-based investment firm, announced a first close of $110M for its $276M fund investing in proptech.

United Airline Ventures, a Chicago, IL-based investment firm, increased its fund size to ~$200M for its fund investing in SAFs.

WEX, a Portland, ME-based global commerce platform, launched WEX Venture Capital, a $100M fund investing in the energy transition.

Supply Chain Capital, a Los Angeles, California-based investment firm, announced the close of its $40M fund that invests in the food industry.

Grit Road Partners, a Omaha, NE-based investment firm, announced the close of its $11M Ag-Venture Fund investing in midwest seed-stage companies.

Share new deals and announcements with us at [email protected]

In the News

Heat corner: After another record-breaking globally hot month of July, UN secretary general António Guterres dubbed this summer the beginning of ‘the era of global boiling’. The Florida coast is now a summer hot-tub, with temperatures reaching 101 deg F last week. This is leading to increased coral bleaching and coral die-off on the Florida coast.

Ocean currents that help stabilize weather from the tropics to northern Europe may collapse much earlier than previously predicted, according to a new study. These calculations for the Gulf stream collapse include many uncertainties and are difficult to predict, so the verdict is still out on the exact timing.

The Supreme Court allowed the Mountain Valley pipeline to resume construction. The ruling blocked decisions from lower courts that prevented work on the $6.6B project, but stopped short of throwing lawsuits brought by environmental groups out entirely—for now.

GM revealed plans for a next generation Bolt using GM’s Ultium batteries, going back on announced plans to cease all Bolt production.

EV charging is having a moment. The EU adopted rules that require fast-charging stations along highways and a group of large automakers joined forces to bring EV fast-chargers in North America. The seven automakers in the joint venture include GM, Honda, Hyundai, BMW Group, Kia, Mercedes-Benz, and Stellantis.

Big buzz brewed around new claims for a superconductor that conducts perfectly at ambient temperature. Skepticism among scientists is starting to cut through the noise, but the implications for such a material would be a great step for climate (think perfectly efficient transmission, levitating trains, infinite-duration batteries, and more).

Biden announced plans to help Americans struggling with the extreme heat.

Right wing groups in the US already have a plan to dismantle environmental and climate policy. Project 2025, created by thinktank Heritage Foundation, is meant to guide the first 180 days of an incoming Republican president.

Products derived from converted carbon emissions got a boost from the White House, as the Biden administration announced $100 million available to support these companies.

The US treasury gets a green flair. Ethan Zindler from BNEF to serve as the Treasury Department’s new Climate Counselor.

Pop-up

Add it to the dictionary: Greenhushing. Definition: when companies get quiet about their climate goals for fear of attracting greenwashing lawsuits.

A dormant volcano could be tapped to heat homes in the Netherlands via the world’s most epic geothermal source.

Volatility in renewable asset prices spark utilities to sell renewable assets.

Developing countries need to mind the widening gap between foreign direct investment and domestic renewable infrastructure requirements to achieve basic SDGs.

Extreme heat requires extreme climate solutions.

Meanwhile, energy efficient buildings save lives during extreme weather events.

Levelized green H2 costs to intersect with gray H2 plants in 5 key markets by 2030.

Climate risk haunts pension funds according to a new Carbon Tracker report.

Wondering what to watch tonight? Check out Wildlife On Screen’s catalog of nature documentaries.

Opportunities & Events:

🗓 AirMiners Kiloton Fund FAQ Event: Join AirMiners on Aug 1 to learn more about their new $250K Kiloton Fund dedicated to buying carbon credits from startups at a discount, and how to apply.

🗓 Women in Sustainability & Energy: Join BE-Ex’s Women in Sustainability & Energy (WISE) series event for a BYOC (Bring Your Own Colleague) community event for an opportunity to connect with other climate tech focused women professionals on Aug 9.

💡 The Engine Blueprint Program: Apply by Aug 16 to the Fall 2023 cohort of the Engine Blueprint Program, an accelerator program for grad students, postdocs, and research scientists to explore commercial opportunities for scientific breakthroughs.

🗓️ Energy & Climate Game Night: Join City Atlas for a night of fun at their NYC August game night to meet other climate tech focused individuals, play collaborative climate tech board games, and engage in climate discussions on Aug 16.

💡 Compute For Climate Fellowship: Apply by Aug 31 to AWS and IRCAI/UNESCO’s fellowship for climate tech startups. Startups will receive full funding and mentorship for technology ideas related to advanced computing in the cloud for fighting the climate crisis.