Last week Wood Mackenzie announced they were shutting down Greentech Media. GTM was the go-to resource for the energy transition over the past 5+ years and I was a daily visitor. The staff, content and research was high quality.

There are a number of new names that have popped up over the year:

Bloomberg Green – the climate and energy transition section of Bloomberg

Climatetech VC – a relatively new effort covering interviews and research topics around climate; also has weekly emails

Perhaps the most interesting part is that climate/renewable energy is covered more frequently in everyday publications as just “energy” or “lifestyle” news…. because that is exactly what these themes are… everyday, important news.

Either way, I still believe there is a place for a “GTM-equivalent” and based on a few separate conversations, it looks like some individuals in the ecosystem may look to bring the band together. If anyone is interested in supporting that effort, let me know and I will connect you to the relevant parties. (Note: Energize could be a customer, but not an investor!)

A LP with history of the energy transition gave me this great line yesterday:

“Some people say the early bird gets the worm. Maybe. But the second mouse definitely gets the cheese”

Having been in/around energy & technology entrepreneurship for over a decade, I know what “being early” felt like…. and it wasn’t enjoyable as we couldn’t predictably lean into growth. Now it feels like there is more ability to go for that cheese knowing the trap already snapped down last decade…

Our critical infrastructure is increasingly digitized. Sensors and analytics are used to optimize operations. These digital networks and sensors create efficiency and improved communications.

Unfortunately, what is used to optimize can also be used to weaponize. These same networks transmitting important operating network conditions and commands can be hacked. And our towns, states, and even federal government are generally woefully unprepared for these nefarious actors.

At Energize we invested in Nozomi Networks to address this problem. Nozomi’s cloud-based technology helps operators monitor their networks, identify anomalies and be proactive in controlling information and instruction flow. Cybersecurity will be a cat & mouse game forever and we need even more companies serving the “OT” (Operating Technology) networks. Reach out to Juan Muldoon at Energize if you are focusing on this space.

Over the years, the scale of climate investment dollars has oscillated dramatically. I think we are going to be at an elevated plateau of interest for a few years now.

Why are there big swings in “climate-tech” investments?

Historically, climate investments were paid with the final 5% of profits… so in any down market, the long-term resilience investments were the first to be cut when profits took even the smallest dip. Last year’s COVID-induced demand shock cratered profits at many traditional industries: energy, utilities, manufacturing… and many companies in those verticals shuttered climate investments. Ironically the firms that need the most resilience help are now the least ready to address the needs.

A few verticals are taking the opposite approach and moving climate-tech investments up the profit stack... meaning these improvements are finally being prioritized ahead of other operating investments. The reason? These “prioritizing verticals” now realize that major consequences of climate change could wipe out the entire business altogether. The verticals leaning in the most are the banks and insurance companies. The government and Department of Defense is also reprioritizing resilience efforts with this administration. Finally, the most forward leaning utilities are also still investing in climate adaptation and resilience.

In general, the higher up the priority stack these climate-tech and resilience efforts, the more steady the investment and the better long-term outcomes for us all. Within the Energize portfolio, Jupiter Intelligence is seeing major tailwinds as these verticals re-prioritize and elevate resilience efforts.

Volta Industries, Inc., the industry leader in commerce-centric electric vehicle (EV) charging networks, today announced that it has entered into a definitive business combination agreement with Tortoise Acquisition Corp. II (NYSE: SNPR), a publicly traded special purpose acquisition company (SPAC). When the transaction closes, the combined company is expected to be publicly traded under the symbol “VLTA”. The pro forma enterprise value of the transaction is about $1.4 billion.

Volta will use this financing to further expand their network to meet the growing demand for electric vehicle infrastructure. Founder and CEO Scott Mercer will continue to lead the company, as he has since 2010.  Scott brings a rare, market-visionary approach to the energy transition. Chris Wendel, Co-Founder and President, will also continue in his lead role for the high-growth company, helping it to master the complexity of the market.

Why now is the time for the EV charging market

Electric vehicles are here. Almost every week a new country, state or vehicle manufacturer commits to an increasingly imminent electric-only future. In 2011, I test drove my first electric vehicle and saw my first business pitches for EV charging. The cars were clunky and the infrastructure untested. At the time, market investment and adoption were not meaningful to me.

Over the last decade, investment and business model innovation in materials science, batteries, charging infrastructure, and new EV models has propelled electric vehicle adoption. I now have no doubt that mobility will be electrified, and believe Volta will play a key, complementary role in building out the infrastructure layer for the electric mobility transition.

Our relationship with Volta

Having witnessed the first EV charging pitches a decade earlier, I knew something special was happening at Volta when I first heard the pitch at a Department of Energy conference in Houston in December 2017. What stood out to our team about Volta was its commerce-driven business model: We believe this unique approach will continue to be a primary contributor to Volta’s high utilization rates, consumer happiness and long-term relationships with site partners.

Since Energize joined Volta’s capitalization table three years ago, we have invested across four different financing rounds and deployed nearly $35 million into the company. Energize first invested in Volta by leading the Series C in 2018. Since then, we led the Series C-2 and convertible note and most recently participated in the company’s $125 million Series D. Energize managing partner John Tough holds a board seat and is the lead director, and principal Tyler Lancaster is also an observer on Volta’s board. In addition to these contributions, Jim Murphy, the President of Invenergy and a member of Energize’s investment committee, actively worked with Volta management to run their project financing process in 2019. Energize is very thankful to be a partner to Volta, and we are excited to continue to support the company through their next step.

Congratulating Volta on the next step

Volta builds and operates a network of EV charging stations that are among the highest utilized in the United States. Strategically placed in front of essential businesses such as grocery stores, pharmacies, banks and hospitals, Volta’s EV network supports a larger consumer trend toward vehicle electrification by placing fueling stations in parking lots directly where consumers already spend their time and money. Currently located in 23 states and over 200 municipalities, Volta’s unique approach has gained significant acceptance and penetration in the market.

We believe that Volta has a tremendous opportunity to be a household name in the next generation of mobility. This growth requires large capital investments into new charging infrastructure, and this SPAC transaction will help capitalize Volta to #driveforward.

I came across a research report on the state of battery systems. The report talked about the massive battery system (residential, commercial, utility scale) deployments coming over the next decade. Battery systems growth will alter our grid and how we think about centralized power generation and storage.

One chart (seen below) in the document shows the total cost of a system in 2021 and 2025, as split between hardware and software. Hardware is the materials and equipment. Software is all of the permitting, design, sales, and non-scalable “people-related” expenses.

Studying this chart shows a trend most in the energy field know: the soft costs are stubborn… and may actually be the harder costs to solve! While hardware costs drop 20-30% over this time period, the soft costs fall at a far slower rate… and become an increasingly large percentage of the overall system cost over time.

This same trend usually happens at the intersection of analog, and regulated industries that are being affected by declining cost curves. At Energize we know that there are many great organizations and investors that focus on balance of systems innovations. Energize is laser-focused on digital applications that address the energy transition. These digital applications tend to best serve the soft costs, so we look forward to finding investments that streamline that part of the cost equation. By delivering efficiencies there, the industry should grow even faster.

(Reach out to Tyler Lancaster and Katie McClain for the experts internally on digitizing the analog world for streamlined process)