News Roundup: Fundraising, Advances in Technology, Corporate Actions and More

There’s been lots of recent movement – no pun intended – in the space where clean tech and transportation intersect. That has included plenty of news on electric vehicles, as well as numerous developments around hydrogen fuel cells.

Case in point: Engie, Royal Dutch Shell, Toyota and 10 other energy, auto and industrial companies banded together in January to push for the development of hydrogen fuel cells. The new Hydrogen Council is “determined to position hydrogen among the key solutions of the energy transition,” the group says in the announcement of its formation. It also released a report, “How Hydrogen Empowers the Energy Transition.”

There has been plenty of fundraising in the hydrogen space of late as well. For example, fuel cell manufacturer Plug Power will expand its operations with a $25M loan from the New York Green Bank, announced in late December. Plug Power, based outside of Albany, makes fuel cells for forklifts and other industrial equipment used at warehouse and distribution centers.

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And in September, Paris-based Symbio FCell raised money from Engie and Michelin in a second funding round. Michelin had already been an investor in the company and is now its largest shareholder.

As far as electric vehicles goes, electric bus manufacturer Proterra plans to double its production and launch operations in California after raising $140M from a group of private investors in a Series 5 round. Greenville, SC-based Proterra will expand production at its South Carolina plant and also open a new factory in the Los Angeles area. Investors in this latest funding round included Tao Capital Partners, Kleiner Perkins, GM Ventures, Constellation Technology Ventures, 88 Green Ventures, Edison Energy and others.

The electric vehicle infrastructure in California continues to grow, with EV charging network ChargePoint announcing in December that it is building 70 new fast-charge locations along busy highways across the state. The expansion “will enable extended-range electric travel throughout the state’s major transit corridors,” ChargePoint says in a statement. The company noted that there are more than 540,000 electric vehicles on American roads already, and more than 235,000 registered in California. Meanwhile, the state’s biggest investor-owned utilities are seeking regulatory approval to spend $1 billion on EV charging stations statewide, on top of the $200 million the three companies are already spending.

Ford, meanwhile, is stepping up its activities in the nascent area of self-driving cars. The company announced this month it is investing $1B in Argo AI, a start-up artificial intelligence company that works on software to control autonomous vehicles. Last summer, Ford invested $75M in autonomous sensor company Velodyne, not long after it participated in a $6.6 million seed funding round for a 3D mapping company called Civil Maps.

Beyond transport, there is, as always, plenty of things going on across the clean tech and sustainable innovation landscapes. Here is a look at some of those developments, starting with technology.

Advances in Clean Technologies

- Morgan Stanley expects energy storage to grow faster than most experts believe, according to a new report. With proper regulatory support, U.S. energy storage capacity could nearly double to more than 140 gigawatt-hours in coming years, the report says. Morgan Stanley analysts expect Tesla and LG Chem to be the leaders in energy storage.

- Energy storage projects in emerging markets are set to grow strongly over the next decade, a new report from IFC and ESMAP says. The growth rate will be about 40% a year for the next 10 years, which will mean 80 gigawatts of new storage capacity. Much of that will come in the East Asia/Pacific region, with China leading the way. Emerging markets currently have less than 2 GW of energy storage capacity in place.

- Popular Mechanics has posted a list of what it terms “11 of the Most Impressive Solar Projects Powering Our World.” It ranges from China’s 85 megawatt Longyangxia Dam Solar Park, the world’s largest, to the Pacific island of Tokelau, the first nation on the planet to be completely solar powered.

- The biggest offshore wind farm in the U.S. is slated to be built in the waters between eastern Long Island and Martha’s Vineyard. The developer, Deepwater Wind, will initially build up to 15 turbines and hopes to expand that number significantly over time. The $740M cost will be financed via equity investments, loans and potentially an investment tax credit.

- Meanwhile, in the middle of the U.S., wind power supplied more than 50% of the electricity to the Great Plains region on Sunday, Feb. 12 — the first time wind has been a majority provider. A power grid that supplies electricity from the Texas Panhandle to Montana was getting 52% of its juice from wind that day, albeit at 4:30 in the morning. Still, proponents are excited that wind power beat the grid’s previous record of 49.2 percent. Texas is the state with the most wind generating capacity, at 20 gigawatts, followed by Iowa, Oklahoma, California and Kansas.

- The global market for floating solar panels will skyrocket from just $13.8M in 2015 to $2.7B by 2025, new research indicates. Solar panels deployed over water will prove to be an increasingly popular way to deploy the technology without using expensive real estate.

New Funds, Mandates and Issuances

- Bond giant PIMCO now has a dedicated environmental, social and governance (ESG) investment platform, intended to expand the company’s offerings of ESG-related fixed income investments. PIMCO also has broadened two existing funds, which will now use more ESG factors in their investment process. The Total Return Fund III is now known as the PIMCO Total Return ESG Fund, while the Low Duration III Fund is now the PIMCO Low Duration ESG Fund.

- Another fixed income manager, Blue Bay Asset Management, is also boosting the ESG input into its investment process. Working with consultant Mercer and Nordic pension fund PKH, the company has launched the  BlueBay Global High Yield ESG Bond Fund, which incorporates ESG factors.

- Investors put nearly $3B into sustainable- or responsible-focused funds in 2016, Morningstar estimates, bucking a trend that saw more than $127B pulled out of open-end funds overall last year. The SRI market got bigger too, with 17 fund launches last year; there are now more than 150 U.S. open-ended funds, and 45 exchange-traded funds, with SRI mandates, according to Morningstar. Numerous big asset managers added ESG criteria to the investment process of existing funds, JPMorgan, Morgan Stanley, American Century, and (as noted above) PIMCO.

- The French government issued its first-ever green bonds earlier this year, raising seven billion euros, or about $7.5B, Reuters reports. Poland had issued its own green bond in December, raising 750M euros. But France’s much larger bond issuance marks the real entry of national governments into the green bond market, Reuters says, noting that previous green bonds had been issued only by corporations or financial institutions such as the World

- France’s Pension Reserve Fund (FRR) has handed ESG mandates worth up to 5B euros ($5.3B) to three asset managers. Sharing the mandates are Amundi, Candriam Investors Group and Robeco Institutional Asset Management. The FRR has long been a leader in the ESG space and launched its first SRI strategy in 2005.

- Fred Alger Management has announced the new Alger Responsible Investing Fund, which looks to invest in growth-oriented companies with positive ESG characteristics. The fund was previously known as the Alger Green Fund but has now broadened its investment criteria as well as its investment staff.

- Northern Trust Asset Management has launched what it calls an “industry-first” sustainable real estate index, developed in response to client demand for a “passive approach to real estate investing” that incorporates ESG factors, the company says. Northern Trust created the index in collaboration with GRESB, a Netherlands-based organization that focuses on sustainable real estate assessment.

- Pax World Management has launched a trio of ESG-related funds. The Pax Large-Cap Fund, the Pax ESG Beta Dividend Fund and the Pax Core Bond Fund, announced in January, all incorporate sustainability and ESG factors into their portfolio construction.

- Althelia Ecosphere, a Luxembourg-based asset management firm, is launching the Sustainable Ocean Fund, a public-private partnership that will invest $100M into 10 to 15 sustainable marine-based projects, primarily in developing countries. The non-profit Conservation International is helping to start the fund as well as providing due diligence on potential investments.

Government, Corporate and Related Activities

- A group of state governors, both Democrats and Republicans, is urging the Trump administration to support renewable energy, Bloomberg reports. The Governors’ Wind and Solar Energy Coalition wants increased federal funding for clean energy research and to modernize local power grids.

- BlackRock CEO Larry Fink, in the latest of his annual letters to CEOs of companies whose shares his company owns, touts the importance of considering ESG factors in investing. These factors can provide essential insights into management effectiveness and thus a company’s long-term prospects,” Fink writes. “We look to see that a company is attuned to the key factors that contribute to long-term growth: sustainability of the business model and its operations, attention to external and environmental factors that could impact the company, and recognition of the company’s role as a member of the communities in which it operates.”

- Add UPS to the growing list of corporations that are bullish on renewable power. Big Brown says it will invest $18M to “significantly escalate its investment in solar energy,” starting with at least eight of its US facilities, according to a report in Sustainable Brands. The installs, to be done by the end of this year, will generate five times as much power from solar than UPS gets today.

- The New York State Common Retirement Fund has joined the Portfolio Decarbonization Coalition (PDC), a group of nearly 30 institutional investors who have pledged to decarbonize their portfolios. “Climate change is one of the greatest risks to our pension fund’s portfolio,” says Thomas DiNapoli, New York state comptroller and trustee of the $185B pension fund. “We’re reviewing and adjusting our investments to reduce that risk and take advantage of the growing opportunities of a lower carbon future.”

- The city of Hamburg, Germany, is considering a proposal to build a large heat storage system under the city. Heat that is produced by industry, renewable energy, waste incineration or other sources in the summertime would be captured and stored to use for heating the city in the wintertime. Hamburg has set a goal of being carbon-neutral in terms of its heating by 2050. The city also opened a large new coal power station, providing  electricity and district heating, in November 2015, Energy Post notes.

- The European Investment Bank has reaffirmed its commitment to invest $100B in “climate action” over the next five years, the  United Nations Framework Convention on Climate Change says. It’s the “largest climate finance contribution of any single multilateral institution,” the UN says, adding that such investments are crucial if countries are to meet their Paris accords targets.

- Nineteen global banks and investors have signed on to a UN-backed framework, the Principles for Positive Impact Finance, meant to channel more money toward clean and low-carbon projects. The Principles “provide financiers and investors with a global framework applicable across their different business lines, including retail and wholesale lending, corporate and investment lending and asset management,” the UN says in a statement.

 

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