๐ŸŒ $75B of US climate tech onshoring #145

Tallying up investments in US manufacturing since the Inflation Reduction Act passed

Happy Tuesday!

In the time itโ€™s taken the EU and UK to whip up their own versions of climate legislation, the Inflation Reduction Act (IRA) has already raked in billions of dollars in announcements for new homegrown private sector climate tech investments.

The IRA, along with the Bipartisan Infrastructure Law and CHIPS Act, is encouraging a new wave of manufacturing facilities to build more batteries, solar panels, and heat pumps domesticallyโ€”after decades of moving production outside the US.

Meanwhile, the US sees the largest single investment yet in community solar. The EPA considers tightening air pollution regulations. And another insurer exits GFANZ.

In deals this week, biotech companies raised $59M for bio-fabricated silk and $5M for advanced biomaterials made from seaweed. Electric boats landed $30M and a supply chain visibility and risk software company secured $50M.

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US onshoring kicks off

Since the passage of the IRA in August 2022, investments in US production of clean energy and climate technologies have soared.

The ~$370B of IRA funding could help drive nearly 10x-worth of private sector investments in energy infrastructure over the next decade and bring a resurgence in domestic manufacturing for the tech that enables it.

So far, IRA incentives have helped spur at least $75B of investment across more than 155 announced clean energy and climate tech manufacturing projects.

Battery boost: EVs make up the vast majority of investments. Battery and automotive companies have announced $52B in planned US factories, 50% of which is for battery production, according to BNEF. Thatโ€™s more than 20x the investments announced in 2021.

So far this year:

Source: BNEF

But itโ€™s not just the battery sector beginning to bring the supply chain stateside.

In January, Korean solar panel manufacturer Qcells announced a $2.5B expansion of its US production capacity. Just this week, Cummins announced a $1B investment to manufacture electrolyzers and other technology for low or no-carbon heavy transport and LG Electronics announced plans for US heat pump production.

Under construction: Of course, announcements are a signal, not a certainty, but itโ€™s a significant shift. More than 90% of manufacturing investment dollars last year went to China and in recent years, investments in clean tech manufacturing in China have been 8x to 10x the size of investments in North America and Europe combined.

Together, the IRA, Bipartisan Infrastructure Law and CHIPS Act represent $2T of public sector incentives to build more stuff in the US. While there are still plenty of questions about the outcomes of this new industrial push, these laws set the federal government up to triple its average annual spend on climate this decade compared with the 2010sโ€”an indication that the US is serious about figuring it out.


Deals of the Week (04/03-04/10)

Venture Fundings

๐Ÿ‘• AMSilk, a Planegg, Germany-based producer of bio-based silk, raised $59M in Series C funding from Athos Group, Novo Holdings, MIG Capital, and Cargill.

โ˜”๏ธ Everstream Analytics, a San Marcos, CA-based supply chain visibility and risk platform, raised $50M in Series B funding from Columbia Capital, Morgan Stanley Investment Management, and StepStone Group.

๐ŸŒพ Victory Farms, a Nairobi, Kenya-based aquaculture farm start-up, raised $35M in Series B funding from Creadev, Acumen, DOB Equity, Endeavor Catalyst, and Hesabu Capital.

๐Ÿšข X Shore, a Stockholm, Sweden-based electric boat startup, raised $30M from SEB Private Equity.

๐Ÿ›ต Magenta Mobility, a Mumbai, India-based EV solutions platform, raised $22M in Series A funding from BP Ventures and Morgan Stanley.

๐Ÿ„ Vytelle, a Lenexa, KS-based precision livestock technology company, raised $20M in Series B funding from Forage Capital Partners, Fulcrum Global Capital, Grosvenor Food & AgTech, KCRise Fund, Mountain Group Capital, Open Prairie, and Serra Ventures.

๐Ÿ  HeatTransformers, a Woerdense Verlaat, The Netherlands-based heat pump installation platform, raised $16M in Series A funding from ENERGIIQ, Energy Impact Partners, and Fair Capital Partners Impact Investing.

๐ŸŒพ Babylon Micro-Farms, a Richmond, VA-based on-site vertical farming provider, raised $8M in Series A funding from Hull Street Capital, New Theory Ventures, VentureSouth, and Virginia Venture Partners.

๐Ÿ  Magnotherm, a Darmstadt, Germany-based sustainable cooling systems developer, raised $7M in Seed funding from Better Ventures, BM H Beteiligungs-Managementgesellschaft Hessen, Extantia Capital, LAUDA, and Revent.

๐Ÿญ GaeaStar, a Berlin, Germany-based reusable clay cup producer, raised $7M in Seed funding from at.inc/, Climate Capital, DART Labs Ventures, Morningside Venture Investments, Sand Hill Angels, and VSC Ventures.

โšก๏ธ Helical Fusion, a Tokyo, Japan-based helical nuclear fusion technology start-up, raised $6M in Seed funding from SBI Investment.

๐Ÿ‘• Carbonwave, a Boston, MA-based startup making advanced biomaterials from seaweed, raised $5M in Series A funding from Katapult Ocean, Mirova, Popular, and Viridios Capital.

๐Ÿ„ Alga Biosciences, a San Francisco, CA-based algae feed additive start-up, raised $4M in Seed funding from Collaborative Fund, Cool Climate Collective, Day One Ventures, Overview, Pioneer Fund, and Y Combinator.

โšก๏ธ Prozeal Infra, an Ahmedabad, India-based solar EPC company, raised $4M in Series A funding from Alchemie Ventures.

๐Ÿฅฉ Zero Cow Factory, a Surat, India-based animal-free dairy start-up, raised $4M in Seed funding from Green Frontier Capital, GVFL, Pascual Innoventures, and Pi Ventures.

๐Ÿงช Impossible Materials, a Hamburg, Germany-based start-up formulating cellulose-based ingredients, raised $4M in Seed funding from Apprecia Capital, Big Idea Ventures, Capital Risque Fribourg, EFI Lake Geneva Ventures, Inter Ikea, Mission Possible, and University of Cambridge Enterprise.

๐ŸŽ Sepura Home, a Victoria, Canada-based high-tech food garbage disposal start-up, raised $4M in Seed funding from Blanco.

๐Ÿ’จ EcoSapiens, a San Francisco, CA-based nature-themed NFT carbon credits platform, raised $4M in Seed funding from Alex Witt, Alumni Ventures, Boost VC, Brayton Williams, Collab+Currency, Menlo Ventures, Ryan Carson, Shan Aggrawal, and Slow Ventures.

๐Ÿ  Futraheat, a Surbiton, United Kingdom-based high-temperature heat pumps provider, raised $2M in Seed funding from Clean Growth Fund.

โ˜”๏ธHohonu, a Honolulu, HI-based 24/7 water level monitoring start-up, raised $2M in Pre-Seed funding from Blue Startups, Builders Vision, Echo River Capital, Elemental Excelerator, Justin Stevens, Overlap Holdings, Reece Pacheco, susquehanna foundation, Sustainable Ocean Alliance, and TELUS.

๐Ÿ“ฆ Bringly, an Amsterdam, Netherlands-based sustainable last-mile delivery provider, raised $2M in Seed funding from Eyos Capital, Ponooc, Shamrock Ventures, and SpeedUp Energy Innovation.

๐Ÿฅฉ Wilk, a Rehovot, Israel-based lab-cultured cow milk company, raised $450K from Danone, Steakholder Foods, and The Central Bottling Company.

๐Ÿฅฉ Myodenovo, a Durham, NC-based cultivated meat scaffolding technology start-up, raised $105K in Seed funding from Sustainable Food Ventures and Sweet Farm.

โ™ป๏ธ Metastable Materials, a Bengaluru, India-based li-ion battery recycling start-up, raised an undisclosed amountin Seed funding from Surge, Sequoia Capital India, VC Speciale Invest, and Theia Ventures.

๐Ÿ„ Alga Biosciences, a San Francisco, CA-based algae feed additive start-up, raised an undisclosed amount from U.S. Department of Agriculture.

๐Ÿ„ CellQua, a Songnam, South Korea-based cultivated seafood start-up, raised an undisclosed amount in Seed funding from Sopoong Ventures.

๐ŸšŒ Ember, an Edinburgh, UK-based electric coach bus service, raised an undisclosed amount in funding from Pale Blue Dot and Contrarian Ventures.

Other Fundings

๐Ÿงช Locus Fermentation Solutions, a Solon, OH-based company that produces biological alternatives to chemicals, raised $117M in debt financing from Jefferies.

๐Ÿ”‹ Princeton NuEnergy, a Bordentown, NJ-based lithium-ion battery recycling startup, raised $12M from US Department of Energy.

Exits & New Funds

CIRCON Environmental, a La Porte, TX-based environmental services provider, was acquired by Covanta for an undisclosed amount.

Sivyer Group, a London, UK-based resource and waste management company, was acquired by Holcim for an undisclosed amount.

Aker Technologies, a Creve Coeur, IL-based crop intelligence tools developer, was acquired by IntelinAir for an undisclosed amount.

S2G Ventures, a Chicago-based investment firm, raised a $300M fund for climate tech financing.

Bidra Innovation Ventures, a San Francisco-based investment firm, raised an additional $200M to invest in sustainability ventures in underserved markets.

Equator, a Nairobi-based-based investment firm, raised a $40M fund to invest in energy, agriculture and mobility ventures.


In the News

Insurers are practicing risk management as Zurich, the week after Munich Re, revealed it is withdrawing from the Net Zero Insurance Alliance (NZIA) that is part of the Glasgow Financial Alliance for Net Zero (GFANZ). Are the underwriting criteria too strict or do fossil fuel premiums look too good?

Commercial solar company Summit Ridge Energy and Korean manufacturer Qcells announced a deal that will deploy 1.2GW of solar panels across 350 projectsโ€”enough to power 14,000 homes. This is the largest community solar partnership in US history and comes as lawmakers again consider tariffs on panels imported from Southeast Asia.

The $8B Willow oil project in Alaska represents a small fraction of planned oil and gas extraction projects, with 70 gigatons of CO2 likely to be emitted from projects approved in 2022 or slated to be approved between 2023 and 2025.

The US DOE announced up to $450M to advance clean energy demo projects on current and former mine lands and $72M to expand clean energy job pathways.

Global Thermostat unveiled its DAC facility in Colorado, with capacity to pull 1,000 metric tons of CO2 out of the air annually. But for now, itโ€™s spinning the fans just to release the CO2 back into the atmosphere.

In the most detailed energy transition plans so far, Exxon projected its low-carbon business, like clean hydrogen and carbon capture, could become more valuable than its fossil fuelsโ€ฆ even as it expands oil and gas production.

The Biden administration proposed two new EPA rules last week. One would reduce air pollution from chemical manufacturers, like those in โ€œCancer Alley.โ€ The other would place stricter limits on mercury and other pollutants from power plants, which could accelerate the retirement of some coal plants.

Researchers at Argonne National Lab and the Illinois Institute of Technology created a promising solid-state battery that could be a breakthrough in lithium-air technology.

California is ordering a complete shutdown of commercial and recreational salmon fishing for 2023, due to warmer waters, over-engineered waterways, and tensions between farmers and fisheries.


Pop-up

After youโ€™re done freaking out about mushroomsโ€ฆ Extrapolations: Your next new climate TV binge.

All green eyes will soon be on the underappreciated (climate) farm bill as Congress renegotiates the trillion-dollar legislation this year.

Latest addition to the lab-grown meat menu: woolly mammoth meatballs.

Keyframe makes the case for structured capital.

Source: Keyframe Capital

What do you get when you combine a solar array, battery storage system, hydrogen fuel electrolyzer, nuclear reactors, and a controllable grid interface? A hundred mile wide VPP.

Equal Ventures breaks down Cleantech vs Climate Tech.

Be careful what you wish for. If Bipartisan Infrastructure Law dollars go toward extra highway lanes, the funding could actually increase emissions from ground transport.

~20% of the Amazon has been destroyed since highways were built through it in the 1970s. Whoโ€™ll save the rainforest now?

Galvanize Climate Solutions gets its hands dirty with residential electrical retrofits.

Play a round of overvalued / undervalued with Sophie on stage at Techonomy.

Who else would you add to this climate tech x AI market map?

~80% of FTSE 100 companies have net zero commitments, but EY finds just 5% have published plans thatโ€™re up to snuff.

The BDSM tent at Burning Man needs AC to survive under new climate conditions.


Opportunities & Events:

๐Ÿ—“๏ธ Circular Economy Catalyst: Apply to attend the Circular Economy Catalyst on Apr 14th-15th to learn about new technologies and business models that reduce environmental degradation.

๐Ÿ—“๏ธ Energy Tech Summit: Join the Energy Tech Summit in Poland on Apr 26th-27th to hear from investors, entrepreneurs, and government leaders about the challenges and future of decarbonization.

๐Ÿ’ก Berkeley Cleantech to Market: Apply by Apr 30th to C2M to receive help identifying market opportunities from UC Berkeley grad students for law-carbon energy, green chemistry, food, and water technologies.


Jobs

Investment Principal @AccelR8

Data Engineer @CTVC

Data Analyst @CTVC

Strategy Associate @Brilliant Planet

Analyst, Investments @Aspen

Machine Learning Engineer @Glacier

Finance Associate, Frontier @Stripe

Experimental CEO @My Next Electric

Chief Executive Officer @Greentown Labs


Feel free to ๐Ÿ“ฉ send us new ideas, recent fundings, events & opportunities, or general curiosities. Have a great week ahead!

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