This article is sponsored by Wells Fargo.
Tackling the climate crisis requires scaling new clean technologies for every sector of the economy. As a result, the clean energy transition is seen as the biggest investment opportunity of this generation.
Investors invested a record $60 billion in cleantech in the first half of 2021, representing a 210% year-over-year increase. Even still, cleantech startups face an uphill battle for commercialization. Startups working on “hard” technologies, especially those operating in highly regulated environments, must spend years conducting research and development in the lab.
Access to additional intellectual, technical, and testing resources is crucial to help startups navigate this “tech valley of death.” The Wells Fargo Innovation Incubator has helped all of its 18 agtech and green building companies move from prototype or reference stage to commercialization, giving them access to state-of-the-art facilities and technical experts from world class. at the National Renewable Energy Laboratory (NREL) and the Donald Danforth Plant Science Center (Danforth Center).
After completing technical validation in the lab, however, cleantech startups face a second hurdle – the “commercialization valley of death.”
In order to get their technologies into the hands of end users, most start-ups need an opportunity to show that their technology will be a viable solution before they even make a sale. Companies often achieve this through demonstration projects, small-scale projects that demonstrate the capabilities of innovative technologies in real-world, large-scale conditions. Such projects are a proven method for bringing new clean technologies from the lab to the market, allowing startups to prove their economic viability, low-carbon capabilities and positive social impacts.
Over the years, the incubator has facilitated several demonstration projects for companies at facilities at NREL, Wells Fargo, and the Danforth Center. For example, NREL’s Flatirons campus in Colorado housed PowerFlex’s electric vehicle charging stations in 2017. NREL realized energy and cost savings from the demonstration project and subsequently purchased over 100 charging stations PowerFlex in a call for tenders. Today, PowerFlex has installed more than 6,000 electric vehicle charging stations across the country, helping customers manage changing electric demand and conditions due to the influx of electric vehicles on the road today. today.
The Danforth Center facilitated a demonstration project for innovation incubator portfolio company Aker Technologies with early validation of technology that automates the culture screening process. With the help of the incubator and the Danforth Center, Aker has since expanded its imaging methods to also be able to detect plant diseases for more targeted and reliable crop assessments to improve profitability and to increase yields.
After working with NREL’s technical team to evaluate the performance of the technology in the lab, Whisker Labs conducted a demonstration project at a Wells Fargo branch in Aurora, Colorado in 2016, evaluating the competitiveness of its monitoring and detection technology. optimization of the energy consumption of buildings. The project provided the Whisker Labs team with insight into the practical applications of their technology and was also used to identify opportunities for energy and cost savings at the Wells Fargo branch.
Now, Wells Fargo is piloting portfolio company Turntide Technologies to demonstrate and validate the commercial viability, energy efficiency and performance of its Smart Motor System. Through the Innovation Incubator program, NREL researchers helped Turntide validate the energy efficiency and performance of its smart motor system. Turntide has caught the eye of major investors, including the Amazon Climate Pledge Fund, and has successfully installed over 5,000 systems nationwide. Now that we’ve come full circle, Turntide will help Wells Fargo move toward its goal of achieving net zero greenhouse gas (GHG) emissions by 2050.
Startups aren’t the only ones to benefit from demonstration projects. Private and public organizations can gain direct insight into potentially game-changing technologies for zero capital expenditure or risk, spurring additional clean technology investment and decarbonization initiatives. That’s why the innovation incubator is branching out to support demonstration projects with outside business and government agencies.
In early April, the incubator announced its first fully demo cohort, made up of five companies ready to demonstrate their technologies with industry partners across the country. Selected companies receive up to $250,000 in non-dilutive funding to support their project infrastructure, as well as technical guidance from world-class NREL researchers who will help prepare, validate or analyze demonstration projects. These demonstration projects will serve as proof points for potential customers and investors who may want to participate in the future success of the project.
With residential and commercial buildings accounting for 13% of US GHG emissions, three demonstration projects will test low-carbon technologies for the built environment. Cohort company BlocPower will work with industry partner Steffes to replace fossil fuel-based systems with carbon-free technologies and increase the energy efficiency of buildings in various communities. Kit Switch will work with Habitat for Humanity Los Angeles to install and analyze its pre-engineered kitchen modules with integrated plumbing and electrical systems in underutilized spaces. Community Energy Labs will demonstrate its AI-powered clean building monitoring platform for Tacoma Utilities and Tenino School District to support and evaluate decarbonization goals.
The other two demonstration projects will focus on electrification technologies for the transportation sector, which accounts for 29% of total GHG emissions in the United States. CorePower Magnetics will demonstrate its patented high-performance electric motors, inductors and transformers with Eaton, which can extend the range of electric vehicles and improve grid efficiency. NineDot Energy will work with Fermata Energy and Revel Transit to turn vacant and underutilized land into community-scale shared power plants using solid oxide fuel cells and stationary energy storage batteries.
With the addition of these five companies, Wells Fargo Innovation Incubator’s total portfolio includes 61 startups. Since joining the program, portfolio companies have raised $1.1 billion in external follow-on funding, which equates to an average of more than $81 for every $1 Wells Fargo grants through the incubator.