Show Me the Money—How to Find It

Show Me the Money—How to Find It

There is a Green Tidal Wave of money coming for clean tech innovators, but the question is how to get it.  One has to read over 1000 pages of “summary guidance” to figure this out.  It takes a lot of work, but at our MeetUp on the evening of January 26th, we presented what we had found in our own review of all the paperwork.  We focused on what the opportunities are for innovators to tap the Inflation Reduction Act and the Infrastructure Act for contract and grant money.  Over $250 billion is earmarked to fund more than 100 line items in each of the federal laws.  In addition, $50-100 billion is available from the state, through a dozen agencies, with the CEC and CARB being the most relevant.  (See in particular our recent blog on the CARB Scoping Plan.)   And many tax incentives have been created in addition that add to the total amount innovators could tap, and add hundreds of billions of dollars of subsidies to projects.  

The biggest take-away is that the details of how to apply for the money are very sparse right now.  That means the best thing to do is to begin to get on mail lists for future funding opportunity notices and to develop relationships with the state and local agencies most likely to be the ones that will administer the money.  Networking can be very effective to get you a better place in line when the money begins to flow.

One of the newest innovations in these laws is the idea of the “Direct Pay” of tax incentives to project developers, even if they have no current tax liability.  This is a huge change from trying to sell tax incentives to an organization with huge tax liabilities, for 60 cents on the dollar.  The impact would be 100 cents on the dollar and paid up-front.  It is like a zero-interest loan.  But like with everything else the details are absent.  How is the up-front payment to be reconciled with actual outcomes?  From whom will the direct payments come?  

A venture investor in the audience agreed that small startups should go after this kind of funding, since it is not a sale of shares and therefore, is non-dilutive.  Moreover, this funding can provide the means to demonstrate and develop a technology that would never be paid for by investors at an early stage.

We also had a discussion as to what the process for actually doling out the dollars would be and whether the politics of the current Congress will get in the way.

To learn more, watch the video below. It contains live links to several other source documents to aid your exploration of how this funding may help you.  We undoubtedly will be returning to this topic as more information is revealed.

Destination Decarbonization: Student Contest with Real Prizes

Destination Decarbonization: Student Contest with Real Prizes

Are you an undergraduate college student and want a shot at several thousand dollars in prize money? Consider entering the 90-day Destination Decarbonization Challenge! Sam Fairbanks at the Water and Energy Technology (WET) Center at Fresno State provided a quick overview of what the challenge is and how to apply. The main point is that the window is now open through January 31. If you want to give it a shot, better move fast. A video of Sam’s presentation is available on our YouTube Channel.

The idea of the challenge is for small teams of 2-4 students to propose ways to eliminate carbon dioxide emissions either from a brand new idea or from an idea on how to improve something that is already happening. Teams can look at anything that broadly will reduce emissions or capture carbon dioxide for beneficial. The teams will work with mentors and other resources the WET Center can help arrange. The payoff comes on April 21 when the teams pitch their ideas to a panel of expert judges.

The top prize is $6,000, with $4,000 for second and $2,000 for third. There is a webinar that provides details on how to apply on January 19 at 5:30 pm. More information is available on the Challenge website.

Check it out!

Thomas Hall

ABOUT THE AUTHOR

Gary Simon is the Chair of CleanStart's Board. A seasoned energy executive and entrepreneur with 45 years of experience in business, government, and non-profits.

CleanStart Sponsors

Weintraub | TobinBlueTech Valley, Revrnt, River City Bank

Moss AdamsPowerSoft.biz, Greenberg Traurig, California Mobility Center

CalNEXT: A New Resource for Innovation

CalNEXT: A New Resource for Innovation

Looking for help to crystallize your cleantech idea into a commercial product that finds a ready market? In July, the utilities in the state launched a new initiative called CalNEXT to speed the pursuit of promising emerging technologies. “CalNEXT is a statewide initiative to identify, test, grow electric technologies and delivery methods to support California’s decarbonized future.” They will fund projects in the range of $20-400K to assess innovations and help shape them to fit product needs that have already been identified.

CalNEXT

CalNEXT

CalNEXT is run by Energy Solutions in Oakland, a 25-year old analytics firm that provides insights on markets, designs for programs to incentivize adoption of innovations, and assessments of the potential of clean technologies. Program Manager Casidee Kido and her colleague Erin Fitzgerald explained how CalNEXT works in our Perspectives session on December 15.

Cassidee Kido

Cassidee Kido

CalNEXT is funded by the ratepayers of the investor-owned utilities in the state (PG&E, SoCal Edison, SoCal Gas and San Diego G&E) and is intended to focus the efforts of energy-efficiency innovators to work on things that can have the most impact on reaching a decarbonized future and the most effective ways to market them. It is an outgrowth of the work of the Emerging Technologies Coordinating Council created by the CEC with participation of all the investor-owned utilities plus SMUD and LADWP a dozen years ago. The idea of the ETCC was to encourage collaboration on RD&D among the utilities and to assure alignment of priorities with the CEC programs as well. As the innovation process evolved into one that involved a much broader set of entities, the ETCC added roles in increasing the visibility of ET resources and opportunities for engagement with ETCC members, along with strengthening the knowledge and capabilities of the ET community by sharing project results, methodologies, and collaboration opportunities. CalNEXT is the new way to achieve these goals and it comes at a great time with more money than ever being committed to clean tech deployment.

Erin Fitzgerald

Erin Fitzgerald

CalNEXT works through “Technology Priority Maps.” These are wish lists of innovations and market information the ETCC would like to see developed. They cover 6 technology groups and 46 families of innovations. The six are HVAC, lighting, plug loads/appliances, water heating, process loads, and whole -buildings. You can look at these here, and then dive into the details of the half-dozen or so technology families in each. Click on those and you get to specific innovations or market support projects the ETCC would like to see. You can then propose projects to address these needs each year. The current round will be open until February 23. The TPMs will be updated and probably adopted late in 2023, with applications then open in Q1 of 2024. Even if you are rejected, you can apply as many times as you like, and on multiple wish list items. To date CalNEXT has funded 35 projects totaling $14 million. At the end of each project, CalNEXT will provide help to connect companies to those in the utilities and elsewhere that can help on moving to demos and commercialization opportunities.

“CalNEXT will track and vet the efficacy and claims of these technologies, products, and solutions to assess and confirm their potential energy savings and operational performance, help estimate long-term cost-effectiveness, prioritize technologies with significant energy savings opportunities, and identify potential barriers to market adoption. CalNEXT is a great opportunity for programs to see their full potential, to get the evaluation and implementation support they need, and for good ideas to come to life and make major impacts to support California’s decarbonized future.”

This looks like a very helpful gateway to the kinds of connections and follow-on funding that innovators need. It is worth exploring even if you have been rebuffed on other programs. The vetting and evaluation process will be helpful in generating investor interest. The whole session is recorded and available.

Thomas Hall

ABOUT THE AUTHOR

Gary Simon is the Chair of CleanStart's Board. A seasoned energy executive and entrepreneur with 45 years of experience in business, government, and non-profits.

CleanStart Sponsors

Weintraub | TobinBlueTech Valley, Revrnt, River City Bank

Moss AdamsPowerSoft.biz, Greenberg Traurig, California Mobility Center

A Friendly New Lender for Climate Tech Companies

A Friendly New Lender for Climate Tech Companies

Our friend Sedale Turbovsky at OpenGrants did a web interview with Dmitry Gershenson of Enduring Planet recently to highlight the increased availability of loans to build your company.  Enduring Planet is a much different lender than a bank because they understand startups and want to see more companies based on sustainability succeed.  Accordingly, their lending requirements are more generous than one typically finds at a bank.  

Specifically what Dmitry is offering is a revenue-based loan.  A company has to be generating revenue and growing to qualify, but doesn’t need to be immediately profitable.  It needs to show revenue of at least $25,000 per month and be growing 30% year-over-year.  Loan terms are pretty simple.  No collateral required and no personal guarantees.  As Dmitry says, this is the fastest and least expensive capital available.

Dmitry has also recognized a need for loans for another type of situation—cash flow loans to bridge the gap between expending money on a project funded by the government and getting reimbursed for that cost.  This may take more than 90 days.  Government grants and contracts are wonderful sources of non-dilutive capital, but a company can go broke dealing with the reality of the slow payment of invoices.  Dmitry hopes to have this offering ready before the end of the year.

Sedale recorded and transcribed the hour-long session and it is available here.  Check it out and even if you don’t qualify, keep this lender in mind when you are seeking capital.

Thomas Hall

ABOUT THE AUTHOR

Gary Simon is the Chair of CleanStart's Board. A seasoned energy executive and entrepreneur with 45 years of experience in business, government, and non-profits.

CleanStart Sponsors

Weintraub | TobinBlueTech Valley, Revrnt, River City Bank

Moss AdamsPowerSoft.biz, Greenberg Traurig, California Mobility Center


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