We're covering trends in cleantech finance along with the deals and dealmakers in this new column about capital flow and greed in the energy transition.
Generate Capital raises $2 billion
San Francisco–based Generate Capital raised $2 billion to support clean energy projects with its "infrastructure-as-a-service" model. Australian investment firm QIC Ltd. and pension fund AustralianSuper led the investment.
Generate is not the typical private equity investor: Investors are essentially buying a stake in the Generate portfolio of companies and their infrastructure projects across the domains of transport, solar, energy efficiency, electric vehicles, fuel cells, wastewater treatment, desalination, waste management and hydrogen-fuel plants.
Last year, Generate raised more than $1 billion to grow its fleet of renewable infrastructure projects. Joining the board at that time was Lynn Jurich, CEO of Sunrun. Richard Kauffman, former New York state energy chief and current chairman of the New York State Energy Research and Development Authority, was named chair of the board at the time.
Tracking climate VC
Energy and climate venture capital is now a growth sector and part of a VC industry that is on pace for a record year. Sophie Purdom and Kimberly Zou cover venture capital and all things climate in their newsletter, Climate Tech VC. Here are the top deals from the duo's most recent VC deal tracker.
Another $4 billion climatetech fund
Definitely sounds legit. I, too, would want a guy who ran one of the world’s biggest oil companies and now another major oil operation. Guess all the people with actual clean energy leadership experience were busy.— Joshua Posamentier (@posamentier) July 17, 2021
General Atlantic, an equity firm with over $65 billion in assets under management, launched BeyondNetZero, a $4 billion fund that targets growth investments related to climate change. Lord Browne of Madingley (chief executive of BP from 1995–2007) will serve as chairman. The fund's investments will focus on "meeting and exceeding net-zero emissions targets" with an emphasis on decarbonization, energy efficiency, resource conservation and emissions management.
SPAC: The final frontier
Julian Spector has the latest on the most recent entrants in the climatetech special-purpose acquisition company (SPAC) frenzy.
- Heliogen, which uses AI-controlled mirrors to concentrate the sun's heat, is going public and expects to raise more than $400 million and be worth $2 billion. Heliogen comes out of serial entrepreneur Bill Gross' Idealab incubator.
- Sunlight Financial is going public. It’s the second-largest provider of loans for home solar systems, ranking behind only GoodLeap, Canary Media's Emma Foehringer Merchant reports. Sunlight has funded more than $4 billion in home solar loans since mid-2016.
- Zinc battery company Eos raised $100 million in convertible notes from Koch Strategic Platforms, an investment arm of Koch Industries. Eos just raised money from a SPAC merger in November.
Julian Spector also wrote about Ecosystem Integrity Fund, which closed its fourth and largest fund at $250 million. Four of EIF's portfolio companies have been acquired, including two solar startups and a smart EV charging company.
EIF partner Geoff Eisenberg shared his view on SPACs, calling them a "double-edged sword": a useful way to grow a company that was just missing cheap capital before it could flourish, not so great for companies with gnarly technical or regulatory challenges to solve. He also said this:
“There are a lot of [SPAC] investments that look like investments in cleantech 10 years ago.”
Recent reporting in Sludge revealed that West Virginia Senator Joe Manchin (D) earns hundreds of thousands of dollars each year from coal sales. David Moore reports that Manchin's family firm, Enersystems, sells "waste coal" services to a coal-fired plant for Mon Power, a unit of electric utility giant FirstEnergy. The senator's total income from Enersystems is north of $4.5 million since being elected to the august body in 2010, according to the report.
Manchin told CNN that he is “very, very disturbed” by the efforts to reduce or eliminate reliance on fossil fuels in the Biden administration's $3.5 trillion reconciliation package.
Manchin said, "If you’re sticking your head in the sand and saying that fossil [fuel] has to be eliminated in America, and...thinking that’s going to clean up the global climate, it won’t clean it up all. If anything, it would be worse.”
That malarky is not a good indication that the package will win the votes of all 50 Democrats in the Senate.
Although it could be considered what reporter Alex Kotch called "Fox News–level climate change denial."
"The most massive wealth transfer in Texas history"
"Texas Governor Greg Abbott raised nearly $20 million in the last 10 days of June, with a major $1 million boost from the biggest profiteer from the deadly Feb. winter storm and blackouts," Texas Observer reporter Justin Miller revealed in a recent tweet.
Energy Transfer Partners raked in $2.4b off the deadly TX winter grid collapse, more than any other energy company.— Justin Miller (@by_jmiller) July 16, 2021
And after @GregAbbott_TX & co let the nat gas industry off the hook again, CEO Kelcy Warren gave $1m to Abbott—the megadonor's biggest contribution ever in TX. pic.twitter.com/b4FqWhfhBm
Meanwhile, Energy Transfer and other gas giants pulled off what San Antonio Mayor @Ron_Nirenberg called “the most massive wealth transfer in TX history." The city's power utility is suing Energy Transfer for price gouging. https://t.co/QLZnWmTASO— Justin Miller (@by_jmiller) July 16, 2021
(Lead image credit: Mark Wilson/Getty Images)
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