Hey friends,

Happy Sunday! It’s been a beautiful few days here in California. Went on some long drives. Got to the beach. Went out dancing with friends. I’m savoring every minute of it before heading back to New York (not that it’s been particularly cold there either). How are you spending these halcyon days of late winter? 

On the climate tech front, it was a busy week in fundraising, as tends to be the case these days. I also took the opportunity to draw insight from a niche climate tech area, namely wells. 

In today’s email:

• Plugging old oil and gas wells; not plug and play
• Fundraising announcements across climate tech
• Other climate tech, climate, and energy headlines

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DEALS IN FOCUS

One fun thing about swimming in climate tech circles is exposing yourself so some of the more niche topics that are of interest to different people. 

Take wells, for example. Carbon removal companies are keenly interested in accessing Class VI wells to inject and sequester CO2 underground. Other folks train their eyes on old oil and gas wells because they leak harmful methane gas. One company even wants to use old oil and gas wells for energy storage.  

While the Class VI well conversation is a fascinating one we’ll table for another day, it’s been a while since we lambasted oil and gas companies here. Let’s turn our attention there. 

The EPA estimates there are more than 2 million inactive, unplugged wells in the U.S., most of which stem from oil and gas operations. While not the largest source of methane emissions by any means (estimates range from 10-20 million metric tons of CO2-e per year), these wells are frustrating, especially because oil and gas companies should plug them once they’re out of use. Suffice to say that doesn’t always happen. 

In particular, there’s a sizable number of ‘orphan’ wells for whom there’s no solvent owner (i.e., the past owner went bankrupt, no longer exists, etc.) These sit in a no man’s land of responsibility and continue to emit methane, pollute groundwater, and degrade air quality in other ways.

A map of orphan wells in the U.S. (via the Environmental Defense Fund)

Not plug and play

Even when oil and gas companies want to do the responsible thing and plug wells, it's not as simple as putting a cork in 'em. Plugging wells is challenging for several reasons:

1. Complexity of the wellbore: Wells aren't just a straight shot down. They consist of a complex network of pipes and casings that extend deep into the ground. Depth makes access for maintenance and plugging difficult. Over time, wells and their pipes also corrode and degrade, making sealing them up nigh impossible in some cases.
2. Pressure and fluid dynamics: In operation, there's usually enough pressure in a well to ensure fluids and gasses stay contained. Once a well is out of operation however, pressure changes, making it harder to control the containment of fluids and gasses throughout.
3. Cost: The cost of plugging a well can be high, especially if the well is deep, complex, or in a difficult-to-access location. Regulatory requirements governing safely also add additional costs. 

Even when wells are plugged (typically with cement), the seal sometimes fails, often due to pressure build up over time. All of this begs for a better solution.

This week, BioSqueeze, a Butte, Montana-based firm, raised $7.4M in Series A funding to commercialize its biomineralization well-plugging technique. Biomineralization is a process in which mineral crystals are deposited in living organisms that can 'grow' them into complex, more dynamic structures.

Specifically, BioSqueeze uses soil bacteria and other non-toxic chemicals to form minerals in wells. Instead of using cement, they pump a fluid mineralizing solution deep into the wellbore, where it can 'squeeze' into spaces other products can't. The technique was developed over ten years with the DOE.

The pitch here is to compete both on cost and, more importantly, on the success of the well-plugging process. The worst case scenario when plugging a well is investing in the process only for the seal to fail down the road. In that case, you've wasted time, money, and accomplished next to nothing. Even in scenarios where costs are higher, if their long-run success rate is high, BioSqueeze should have no problem attracting clientele.

BioSqueeze operations in the field, busy pluggin’ away (via their website)

In terms of their clients, BioSqueeze primarily works with oil and gas companies. That’s one challenge here. Those are the only people with real money for plugging wells; oil and gas companies have regulatory responsibilities and, ESG naysayers be damned, do care about the optics of abandoning unplugged wells.

What happens with orphan wells, for whom there's no solvent owner? While there’s some federal funding available to plug orphan wells it's not always enough to cover costs. BioSqueeze has noted it will “devote a portion of its new capacity to assisting state and federal efforts” in this effort. Which is great, but also sounds more like charity to me than a growth area for the business.

The net-net

BioSqueeze’s technology stands out to me because while it seems like a niche application, I bet it will find use elsewhere. Plugging wells alone will become more critical in the next decade. And not just to mitigate methane emissions; as carbon removal companies start storing CO2 underground in wells, they’ll need to make damn sure they’re air-tight. Beyond that, in the same way gels from spacecraft are making their way into home energy efficiency, there’ll be other applications for BioSqueeze’s biomineralization I can’t think of right now. 

That said, thinking and reading about BioSqueeze also brought something else home for me. The financial incentive to scale their tech across different applications isn’t always readily apparent. Orphan wells are one example: For many of these across the country and world, there’s insufficient economic incentive to plug the well. To be sure, there are massive climate and ecosystem benefits in favor of plugging. But they’re not always easy to monetize. 

In time there will be new systems that help bridge the gap. Carbon credits come to mind. But even if you could get credited for preventing methane emissions by plugging a well, the value of those avoided emissions might not cover the (up to six-figure) cost of plugging. 

The tech innovation is essential and exciting, as always. And at the same time, there’s a lot more thinking needed on how to scale technologies whose principal ‘product’ is the avoidance of something society hasn’t properly priced.

DEAL HEAT

Large venture funding rounds

🔌 Zeekr, the EV division of Geely, based out of Shanghai, China, is raising $750M in Series A funding for its luxury EV business. Chinese battery giant CATL is one of five investors in the round. Read more here. (China, Transportation)

Medium-sized venture funding rounds

🌱 Loam Bio, based out of Orange in New South Wales, Australia, raised ~$72M in Series B funding to make seed coatings that help plants capture more carbon. Lowercarbon Capital led. More here. (Australia, Food & Agriculture)

🔋 NanoGraf, based out of Chicago, raised $65M in Series B funding to make next-generation silicon anodes for lithium-ion batteries. Volta Energy Technologies and CC Industries co-led. More here. (U.S., Industry)

🔌 Magenta Mobility, based out of Mumbai, India, raised $20M in Series B funding and $20M in debt for its EV charging and rental platform. More here. (India, Transportation)

🔋 ZEVX, based out of Gilbert, AZ, raised $20M in funding for its EV power systems and data intelligence platform. Reynolds Capital led. More here. (U.S., Transportation) 

🔌 ChargerHelp, based out of Los Angeles, raised $17.5M in Series A funding to provide operational and maintenance support for EV fleets and charging infrastructure. Blue Bear Capital led. Read more here. (U.S., Transportation)

☀️ Astatine, based out of Ireland, raised ~$16M in funding from Solas Sustainable Energy Fund to help corporations adopt renewable energy and other decarbonization tech, like heat pumps. More here. (Ireland, Energy)

💸 Earth Finance, based out of Seattle, raised $14M in seed funding for its corporate strategy and policy consultancy. The firm will also invest in climate firms. Read more here. (U.S., Professional Services / Finance)

🚲 Dance, based out of Berlin, raised ~$12.8M (combined equity and debt) for its e-bike subscription platform. HV Capital, Eurazeo, and BlueYard participated. Read more here. (Germany, Transportation) 

🔋 Cylib, based out of Aachen, Germany, raised ~$12.4M in extended seed funding for its lithium battery recycling business. World Fund led. Read more here. (Germany, Industry)

📊 Greyparrot, based out of London, U.K., raised $11M in Series A funding for its waste analytics platform that aims to accelerate wastewater recycling. Regeneration.VC led. More here. (U.K., Climate Data)

⬇️ QiO Technologies, based out of Surrey, U.K, raised $10M in Series B for its decarbonization platform targeted at energy-intensive enterprises. Wave Equity Partners led. More here. (U.K., Carbon Management)

🌞 Complete Solaria, based out of San Ramon, CA, raised $10M in funding from Foris Ventures for its solar services and installation company. Complete Solaria is a new company that's a product of a reverse merger between Complete Solar and Solaria, a solar module maker. Read more here on the funding news and here for more on the merger. (U.S., Energy)

Smaller venture funding rounds

📊 BluWave-ai, based out of Ottawa, Canada, raised $9.5M in Series A funding for its grid optimization software. PowerON Energy Solutions led. More here. (Canada, Energy) 

🍊 The Ugly Company, based out of Farmersville, CA, raised $9M in Series A funding to make snacks from upcycled fruit. Sun Valley Packing led. More here. (U.S., Food & Agriculture)

🌞 Qotto, based out of France with operations in Burkina Faso and Benin, raised $8M in Series A funding (combining equity and debt) for its home solar business for African markets. IBL Group led. More here. (Africa, Energy)

🤖 CaPow, based out of Be'er Sheva, Israel, raised $7.5M in seed funding for its battery-free continuous power solution for robotics. IL Ventures led. More here. (Israel, Industry)

⬇️ BioSqueeze, based out of Butte, MT, raised $7.4M in Series A funding to seal methane leaks in depleted oil and gas wells via its biomineralization technology. Valo Ventures led. More here. (U.S., Carbon Management)

🌱 Robigo, based out of Cambridge, MA, raised $6.85M in seed funding to develop sustainable crop protection products. Congruent Ventures led. Read more here. (U.S., Food & Agriculture)

♻️ Bibak, based out of Eindhoven, Netherlands, raised $6.4 million (combined equity and debt) for its platform that helps replace single-use plastics with reusable food containers. More here. (Netherlands, Industry)

🥩 Planetarians, based out of San Francisco, raised $6M in Seed II funding for its plant-based meat. Mindrock led. More here. (U.S., Food & Agriculture)

🔋 Quino Energy, based out of San Leandro, CA, came out of stealth with $4.55M in seed funding and a water-based organic flow battery technology. ANRI led the round. More here. (U.S., Energy)

🍄 Funga, based out of Austin, TX, raised $4M in seed funding to remove carbon from the atmosphere by fostering more belowground biodiversity via forest fungal networks. Azolla Ventures led. More here. (U.S., Carbon Management)

💸 Raise Green, based out of Somerville, MA, raised $1.9M in community-sourced financing for its climate investing platform. More here. (U.S., Finance)

🌬️ Gaia Turbine, based out of Ticino, Switzerland, raised ~$1.08M in seed funding for its modular hydroelectric turbines. TiVentures participated. More here. (Switzerland, Energy) 

Private equity and other funding rounds 

🛒 In acquisitions, BP announced it will buy TravelCenters of America for $1.3B in cash, in part to claim real estate to build out EV charging infrastructure along America's highways. More here. (U.S., Transportation)

⛏️ Piedmont Lithium, an Australian miner with operations in the U.S., raised $75M from LG Chem, the Korean chemical and battery manufacturer. LG Chem also placed a four-year order for 200,000 metric tons of lithium chemicals. More here. (U.S., Industry)

🌾 Plenty Unlimited, based out of San Francisco, received a $20M grant from the Wyoming Business Council to build a vertical farming research center in Laramie, WY. Read more here. (U.S., Food & Agriculture)

⚡ Fulcrum Bioenergy, based out of Pleasanton, CA, received $16.8M in grant funding from UK Department for Transport Advanced Fuels Fund to build a plant to turn waste into sustainable aviation fuel in England. More here. (U.K., Transportation)

🚢 AceOn, based out of Telford, U.K., received £4.6M in grant funding from Innovate U.K. to convert crew transfer vessels from diesel to battery and hydrogen power. More here. (U.K., Transportation)

🌾 The USDA's National Institute of Food and Agriculture (NIFA) announced investments totaling $70M in sustainable agricultural projects at universities across the country. Read more here. (U.S., Food & Agriculture)

New funds 

💰 Counteract, based out of London, raised £15M (this is on first close, the fund is targeting £35M in total) to invest in carbon removal companies. More here. (U.K., Funds)

ELSEWHERE IN CLIMATE TECH

🏭 Onshoring: While Ford announces a $3.5B investment in new battery manufacturing capacity in Michigan, some Senators question the deal’s ties to Chinese battery giant, CATL. 

🏭 Onshoring, pt. II: Centrus Energy completed the construction of advanced uranium enrichment centrifuges. The firm is working towards producing High-Assay, Low-Enriched Uranium (HALEU) domestically. At present, HALEU is predominately made in Russia.

⛏️ Metals and mining: India discovered a massive lithium deposit last week, vaulting it into the world’s #5 spot in terms of lithium reserves. 

📜 Policy: EU lawmakers approved a new ban on new gas car sales by 2035. 

💸 Public funding: The Biden admin opened up $7B in funding for residential and community solar projects in disadvantaged communities while the DOE granted $74M to various enhanced geothermal pilot projects.

❓ What the H: It’s not just Europe. Lawmakers in the U.S. are squabbling over how to classify hydrogen, with significant tax credit implications (paywall). Elsewhere, China broke ground on the world’s largest green hydrogen project.

🤝 Partnerships: U.S. Steel inks an agreement with GM to supply them with their verdeX® steel, which it can produce with 75% lower emissions than conventional steel and up to 90% recycled material.

🤝 More partnerships: Tesla will open up some of its national charging network to other EVs. 

📈 Another splashy debut: Enlight Renewable Energy, an Israeli renewable energy developer, raised $293M in its IPO on Friday last week, marking the second straight week with a splashy climate tech IPO.

🗣️ Fault lines: The Republican supermajority in the West Virginia legislature relented and approved $105M for Form Energy's planned battery factory in their state. This came after serious debate as Form's products are perceived as a threat to other WV industries, like coal. 

☁️ Geoengineering: More folks are exploring geoengineering techniques to tackle climate change. See, for instance, new research on using iron particles to break down methane in the atmosphere more quickly. All of which begs the question… what geoengineering is ‘good’?

📉☢️ Not on time & not on budget: Two new nuclear reactor units scheduled to come online in 2023 at Plant Vogtle in Georgia are delayed further and will cost an additional $200M. Elsewhere, EDF also increased its cost forecast for the nuclear power plant it’s building in the UK to £32B (up from £26B). Completion of Hinkley Unit C may also be delayed into 2028.

🚫 so good news: Antarctic sea ice levels reaches a new record low. 

🌞 Closing on good news: Deforestation in the Brazilian Amazon was down 61% in the first month of Lula’s presidency based on satellite imagery data.

Cheers to you from the California coast,

— Nick

Written by me, Nick Van Osdol.

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