Dodge is making an EV. I can’t tell you how excited I am. With all these awesome new EVs coming out it’s making me tempted to become a collector. Reply and let me know if you think I should do it.
Maybe we do an annual Impact EV car show?
We launched a new “feature” this week – we’re calling them deep-dive series, where we break down everything going on in a specific niche of the climate so all of you investors and founders know how to think about these growing sectors. This week I introduce the start of my Distributed Energy Resources deep-dive.
Let me know what you think and keep the feedback coming!
In Your Inbox: Solar panels that capture water; How to leverage towns and cities as initial DER customers; Climate First banking and Fintechs on the rise
SOURCE, a hydropanel technology startup backed by Breakthrough Energy Ventures, is focused on producing clean water for consumption. Cody Friesen, SOURCE’s CEO, elaborates how big this problem is, how SOURCE is tackling this problem, and how SOURCE is thinking about impact/impact metrics.
Water is humanity’s most fundamental resource, and arguably its greatest challenge. 2.1 billion people around the world do not have clean, safe water to drink. Every day, women and girls spend 200 million hours collecting water for their families and every 10 seconds, someone on the planet dies from a waterborne illness. The problem goes beyond the developing world. Two million Americans are without running water in their homes and at least 20 percent of the nation’s well water would not pass a water quality test. The UN estimates that by 2050, 6 billion people will suffer from clean water scarcity as a result of climate change.
Water-stressed communities, consumers who want higher-quality water, businesses, hospitals, schools, and hotels and tourism destinations are increasingly turning to drinking water extracted from the earth, packaged in plastic and trucked in from afar, leaving a massive carbon footprint and half a trillion plastic water bottles behind.
By producing fresh, clean and renewable drinking water, off the grid, infrastructure-free, and from the sky, we can solve the water problem and, in the process, protect the planet and create products and experiences for people and organizations committed to sustainability. In places where safe drinking water is scarce, this technology can improve health outcomes, promote self-agency, and create economic well-being and opportunity.
SOURCE is a category disruptor and industry creator. Our patented technology is singularly able to efficiently capture an endlessly renewable resource – water vapor present in the atmosphere – and transform it into premium drinking water, with no filtration or outside source of electricity.
SOURCE water starts pure, is produced sustainably with sunlight and air as the only inputs, and close to where it is used and makes water an endlessly renewable supply.
The impact of clean, safe and sustainable water is immeasurable, but at SOURCE, we think in terms of:
Our mission is to perfect water for every person, every place, and we have the tools to deliver: technology that efficiently, sustainably produces high-quality, renewable water nearly anywhere on the planet, a thoughtful strategy, the financing to execute it and, above all, a deep and passionate commitment. Ultimately, we want to deliver the lowest-cost potable water in the world, which will happen as our technology continues to develop and we achieve economies of scale.
It’s a cliché, but completely verifiable: your results in life are directly correlated to your commitment. You might be talented. You might have a world-changing idea. You might get a lucky break or run into someone who’s willing to put up with less than a wholehearted effort, but that’s rare and usually short-lived. The people who make an impact in this world show up. They realize that the opportunity to work and learn is a privilege.
If you are working on something that you legitimately believe can improve people’s lives it is imperative to “go all-in” to give it everything you’ve got. Investors will see it. Potential employees will see it. And your rate of progress will show it.
Water and energy go hand in hand. Michael Webber, the current CSO/CTO at ENGIE, points this out in his book, Power Trip: “Because the modern water system directly depends on energy, that means modern civilization depends on energy and water. It goes the other way, too: the energy systems depend on water up and down its supply chain.” SOURCE is making the best of this pairing by relying on solar energy to power its technology.
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While microgrids and distributed energy resources (DERs) have picked up in popularity over the past few years within a small, yet vocal audience of energy infrastructure enthusiasts – like myself – it has demonstrated slow adoption.
Most companies entering into the space tend to struggle predominately with a mix of finding sources of capital to finance projects or struggle with customer acquisition.
However, many startups – whether providing a new hardware or software solution – may find success tapping into the budgets of cities and towns in climate progressive states like NY or CA.
I’ve worked in the climate space and in local politics for years now – predominately focused on DERs. Among the most untouched sources of capital that are rarely reported on are the ones made available directly to local governments to adopt new energy infrastructure.
Startups can leverage these programs as a means to drive adoption of their systems – mainly because cost tends to not be the barrier for adoption.
ConEdison in NY subsidies up to 100% of EV charging infrastructure for approved towns as of writing this, NYPA may cover the entire cost of putting solar on government-owned properties should the capacity result in reasonable community solar economics, and NYSERDA subsidizes a significant portion of energy efficiency upgrades through grants provided directly to the town or city.
However, many startups tend to miss the chance to bid for these projects or introduce their alternative to local town or city councils
Crafting your product to fit within the constraints of the grant and creating relationships within both the grant issuing organization and local towns and cities is extremely important. Larger entities like ChargePoint or Flo will have dedicated regional sales managers who go out and actively engage in local politics as a means to understand the challenges each community is facing – which results in making effective introductions of your solution at the right time.
The best way to win or be in strong consideration for these town or city level DER related grants is to be:
As with any SMB sale or Enterprise sale, you must plan for a 6 – 18 month close time. However, for many deep tech cleantech solutions in the DER space looking to close their first “commercial sale” it’s best to start building relationships within your local community and engaging as a thought leader in your sector well before you’re ready to begin your commercialization phase.
Most early sales for startups when dealing with local towns or cities tend to come from personal relationships.
Programs like 76West in NY are a great example of how local city partnerships can result in funding opportunities for startups.
So, if you or a team member have time over a weekend – investing early in learning about funding opportunities being issued to local towns or cities – it is highly likely you can get your first few sales with a government – though you should plan to be as competitive as possible during the RFP process.
These grants are issued to help move states closer to their overarching climate goals. With bipartisan support for new renewable and resilient grid infrastructure, there are new programs being introduced across the US to help each community tap into state funding to make the climate-friendly choice.
As startups begin to learn the landscape of these grants I fully expect to see this as a preferred route for many hardware and software DER startups to get an early customer. As these grants make DER projects rather de-risked for many of these local towns.
There are many new ways for people to take part in fighting climate change. Ravi Mikkelsen discusses how Atmos Financial is building banking solutions that anyone can contribute to and help the world transition to a clean economy while earning money on their deposits.
Atmos is a banking startup, and our mission is to rapidly finance the clean-energy transition. One hundred percent of the deposits placed into Atmos accounts fund climate positive infrastructure, e.g. rooftop solar, regenerative agriculture, carbon-free cement, green hydrogen, etc.
The biggest difference between Atmos Financial and the traditional or legacy banks, is that we’re not a bank. We offer banking and FDIC-insured bank accounts by partnering with an existing bank. We’re setting up additional banking relationships where these banks will use one hundred percent of our deposits for climate positive purposes.
Atmos is providing the customer relationship with the banks we have partnered with. Customers will use our interface when they open an Atmos account. Right now, we are finding banks that have existing renewable energy lending programs, and we’re slotting our capital into those programs. Later this summer, we will launch our own direct lending program, where we’ll start doing the loan origination for many smaller projects. Ultimately, Atmos is a climate tech company focused on decarbonization, and our products and services will help us achieve that mission.
People’s bank deposits have so much more power than they think. Even if you live in an apartment, where you don’t necessarily have a roof to put solar on, by moving where you bank, you can help finance the installation of solar on someone else’s roof. Same thing with electric vehicles. It’s not just one installation, the capital can be cycled as the loan gets financed and sold and financed again. The impact that we’re looking to have is the deployment of gigawatts and terawatts of clean carbon-free energy, millions of electric vehicles, and more.
Also, we have a tool on our homepage that gives an estimate of the carbon impact of your deposits when you put them into Atmos. From conversations with our banking partners, 2.34 pounds of CO2 are avoided per year, per dollar deposited in Atmos. So, if you have roughly $13,000, that will help avoid 32,000 pounds of CO2 equivalent per year, which is the average carbon footprint for an adult in the US. Customers will earn up to 10X the national average on their savings, and also be providing funding to renewable energy projects to make up for their own footprint.
We’re about to release a checking account and debit card and people have asked us about tracking the carbon impact of their daily purchases. While they have some cachet right now, these purchases such as a daily cup of coffee or a book from a local shop don’t make up much of a person’s impact and are less elastic, than some of the more impactful, non-daily purchases. The biggest purchases that impact a person’s carbon impact are: ground transportation energy consumption, home energy consumption, flying (if they are in the minority that flies 2X or more per year), and food. Of these, most people can easily change to electric vs continuing to burn fossil fuels and pay to get their electricity from renewable sources. Reducing meat and dairy consumption are good if that’s a big source of daily consumption, but we all still need to eat, so that will never go to zero. The goal should be to continue to improve and for those seeking to upgrade their personal energy infrastructure, we can help secure low-cost financing to make these upgrades even more economically attractive as well. These changes will all be shown in the impact tracker inside of the Atmos app as well.
I see a lot more fintech companies working with community banks on causal banking, whether it is climate or racial justice—it can be so many different things, but it is around the social impact or niche demographics. And, these different sorts of niche fintech companies can work with community banks to reach different communities or to finance new asset classes.
Consumer awareness will drive the transition to climate-positive banking. For instance, fossil-fuel-free index funds performed much better—compared to index funds with fossil fuels—over the last decade, and will continue to outperform. On the insurance side, climate risk is being taken into account on home and renter’s insurance, as well as being priced into mortgages, albeit slowly. Similarly, as more electric vehicles and autonomous vehicle adoption rolls out, we will see changes in automobile insurance plans.
Effectively consumer banking seems to be moving towards financing climate-focused projects. Using consumers as a source of capital can help smaller banks compete with the large private equity groups and global banks that currently dominate in solar financing.
Eventually, every component of the capital stack of banking will be shifted away from traditional fossil fuel products and towards positive climate impact products as the returns are significantly higher as incentives make it so. Consumer awareness and economic drivers will accelerate the transition. Atmos is innovating to accelerate this movement to a clean, green, and inclusive economy.
Editors: Swarnav S Pujari, Daniel Kriozere
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