August 4, 2022
Photo: Appolinary Kalashnikova/Unsplash
Hello, and welcome to Protocol Apocalypse. Errr, Climate. Sorry, we got carried away there. Guess there’s just something in the air. Anyway! Today, we’re bringing you news about how to stop the apocalypse by checking in on the tech winners of the Manchin-Schumer agreement and the future of the gas station. Buckle up.
At 725 pages and with $369 billion in climate investments, ranging from direct investments to tax credits to research funding, the Inflation Reduction Act is a doozy.
How it’s broken down and divvied up has massive implications for the startups working on solutions on the ground. This week, fellow newsletter Climate Tech VC published a tracker that breaks down which subsectors stand to benefit the most from the bill. I sat down with the newsletter’s co-founders, Sophie Purdom and Kim Zou, to get to the bottom of who the biggest winners would be should this bill pass.
There are some sectors that could really see transformational investments. That could make them attractive places for tech startups to focus their efforts. And they’re like industries where private climate capital could help unlock even greater carbon savings.
Perhaps the most surprising winner? Environmental justice initiatives. Zou pointed to the problem of the “green premium,” a term coined by Bill Gates to describe the inherent higher costs associated with new climate tech that can leave lower-income households out of the clean energy transition.
In short, though, everyone stands to gain from the IRA’s historic investments. What’s surprising about the bill is the breadth and diversity of sectors that would benefit. The bill isn’t just focused on solar and wind, the traditional stalwarts of clean tech. (Though they would surely reap benefits from the clean electricity portion of the bill.) “There’s benefits across the climate capital landscape, and that in and of itself is beneficial because of the intersectional nature of climate tech,” Zou said.
Of course, Congress needs to pass it for those benefits to become a reality.— Michelle Ma (email | twitter)
Jonathan Levy spends a lot of time thinking about the future of the gas station. Or, rather, how the future of car charging may not have much to do with gas stations at all.
Levy is the chief commercial officer at EVgo, one of the biggest electric vehicle charging companies in the U.S. The company and others like it are reimagining how we get around, building out a distributed network of charging infrastructure that isn’t necessarily tied to the gas station model that’s ruled America's roads since the early 1900s.
Charging companies are creating something new. EVgo has struck deals with Whole Foods, Albertsons and Kroger to ensure charging stations exist in the places “that you are going to go to anyway,” Levy said. Competitors like Flo have teamed up with utilities like ConEd to install chargers on city streets.
… but they’re also borrowing from the gas stations of yore. And, well, the gas stations today, since there are more than 116,000 today. Those 100 years of history have something to offer EV charging companies as they plan for the next 100 years.
The Biden administration, for its part, has committed to ensuring that 40% of federal climate and energy investments benefit disadvantaged communities. That’s top of mind for Levy as he ensures that EVgo’s charging stations are deployed in a way that is convenient for drivers, but also equitable. “A lot of communities of color have been in food deserts or [been] redlined,” Levy said, referring to a racist lending practice. “If you just follow those places, then you will accidentally repeat those mistakes as well.”— Kwasi Gyamfi Asiedu (email)
Chip shortage could undermine national security: The global shortage of semiconductors has impeded the production of everything from pickup trucks to PlayStations. But there are graver implications than a scarcity of consumer goods. If the U.S. does not ensure continued domestic access to leading-edge semiconductor manufacturing, experts say our national security could suffer.
British nuclear fusion company First Light Fusion raised a whopping $486 million in its latest stint of financing, which is among the largest-ever rounds by an energy startup in the country.
Nothing screams “the future” like robo renewables: Terabase Energy got a big vote of confidence in its vision of automating solar panel installations with a $44 million series B funding round co-led by Breakthrough Energy Ventures and Prelude Ventures.
VoltStorage, a German energy storage company, raked in a $24 million investment from the power technology company Cummins.
Aurora Hydrogen, a Canadian startup using a microwave-based technique to produce hydrogen from methane gas sans carbon emissions, raised $10 million in its series A funding round, led by Energy Innovation Capital.
The VC subsidiary of the printing giant Xerox made a $7 million investment in the lithium-ion battery recycling company Li Industries as part of a series A financing round.
Consumer-focused climate fund Regeneration.VC made a $7 million investment in Smarter Sorting, a data company focused on sharing chemical and ingredient information on consumer products in order to promote sustainability.
Puerto Rican startup Raincoat, which aims to offer customizable insurance to protect individuals from climate disasters, raised $4.5 million in its seed funding round, led by Anthemis.
Meanwhile, the private equity firm Actis will acquire a controlling stake in the Dubai solar platform Yellow Door Energy, which has more than 100 megawatts of solar capacity already operating, and 100 megawatts more in development.
The Chips Act has a CDR surprise. The bill, which Biden is expected to sign next week, would more than double the amount of money that the Department of Energy can devote to carbon dioxide removal.
Blighted houses could become virtual power plants. A California nonprofit is betting that abandoned homes could be revamped with a full suite of clean energy technology, including battery storage that could provide backup power in an outage.
Utility shut-offs during extreme heat are a huge concern in a warming world. Yet many states allow utilities to do just that if bills are past due. The consequences could be deadly.
The saddest climate tech omission in the IRA: the trusty bicycle. The bill dropped provisions to incentivize the purchase of the Protocol Climate team’s favorite zero-emission form of transportation.
“Europe faces now an existential dilemma” isn’t exactly a phrase you want to hear ever. But it’s particularly worrisome with winter coming up on the horizon and gas reserves dipping lower and lower.
Chip shortage could undermine national security: To ensure American security, prosperity and technological leadership, industry leaders say the U.S. must encourage domestic manufacturing of chips in order to reduce our reliance on East Asia producers for crucial electronics components.
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