Australian Clean Energy Innovators signal strong investment pipeline

28 February 2017

Innovators seeking as much as $88 million in immediate financing are meeting with investors in Sydney, in a new push to accelerate investment into Australia's emerging innovative clean energy sector.

The Clean Energy Innovation Fund is holding its first Clean Energy Innovators Demo Day, providing innovators and start-ups with a platform to showcase their technologies and business plans to potential investors. The Clean Energy Finance Corporation (CEFC) finances investments made through the Innovation Fund.

"We are bringing together 10 shortlisted innovative entrepreneurial companies and some 50 investors, with the aim of accelerating investment in cutting-edge clean energy businesses," said Blair Pritchard, Investment Development Director at the CEFC.

"The response to the Innovators Demo Day has been overwhelmingly positive. It's a clear sign of the strong potential of the innovative clean energy sector, both entrepreneurs and investors. Not everyone who wanted to attend could be accommodated at this time. We're already looking to organise follow-up sessions."

The Clean Energy Innovation Fund invests in clean energy businesses that have progressed beyond the research and development stage, but are not yet able to attract sufficient private sector capital. The Innovation Fund has been in operation for less than a year and has already made three investment commitments across a range of businesses, injecting $25 million into the sector.

"The Innovators Demo Day is one way of helping innovative companies take that next big step to accelerate growth," Mr Pritchard said.

"These discussions will help the Innovation Fund extend our investment pipeline. The CEFC's main role here has been to act as a catalyst, bringing the innovators and the investors together and allowing both groups to assess one another. We are enormously encouraged by the response."

Mr Pritchard said some strong themes emerged from the innovative clean energy companies invited to showcase their plans.

"The focus in 2017 seems to be 'behind the meter' - rooftop solar generation, and localised demand response, grid control and battery storage solutions," Mr Pritchard said.

"Energy efficiency is also a theme, which is not surprising given concern about energy prices.

"These businesses are all looking to execute their go-to-market strategies. They are keenly aware that it's a dynamic market, and they all want to rapidly develop their technologies and business propositions to stay ahead of their competitors."

Mr Pritchard said investors see energy as the next key market to be favourably disrupted by innovative technologies.

"Investors are keen to get into this emerging sector and want to learn more about the clean energy space," he said. "They want to meet potential co-investors as well as businesses they can invest in."
 
Mr Pritchard said that although the investors were clearly motivated by the desire to be part of a new growth industry and to make profitable investments, there was more to it than that. "Many are deeply concerned about recent trends in the environment and feel they have a mission to help find and implement solutions."

The CEFC, working with ARENA, has made three investment commitments through the Innovation Fund:

• January 2017: committed $5 million to GreenSync, an innovative Melbourne-based company aiming to bring smart technology solutions to the energy grid of the future, as part of an $11.5 million Series B capital raising. ARENA is also providing grant funding to GreenSync to carry out the decentralised energy exchange (deX) project.

• December 2016: $10 million to the $50 million capital raising of Carbon Revolution, a Geelong-based company that produces one-piece carbon fibre car wheels that, through their light weight, help reduce energy consumption and carbon emissions from lighter vehicles.

• September 2016: $10 million in finance to the $20 million Clean Energy Seed Fund, which focuses on unearthing and financing emerging innovations and start-ups in clean energy. The Seed Fund is managed by Artesian Venture Partners.