New Energy Efficiency and Renewable Energy Technologies Coming to the Market September 4, 2014 . Renewable Energy on Institutional Property Webinar Series June through September 2014 www.ssfonline.org 1 Gary Dirks LightWorks Arizona State University Edward Saltzberg Security and Sustainability Forum SSF Archived Climate Solutions Webinar Series • Urbanization and Growth on a Finite Planet • International Environmental Security • National Climate Assessment • Water Management • Adaptation to Protect Security in a Changing Climate • Renewable Energy on Institutional Property www.ssfonline.org
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New Energy Efficiency and Renewable Energy Technologies Coming to the MarketSeptember 4, 2014
.
Renewable Energy on Institutional Property
Webinar SeriesJune through September 2014
www.ssfonline.org
1
Gary DirksLightWorks
Arizona State University Edward SaltzbergSecurity and Sustainability Forum
SSF Archived Climate Solutions Webinar Series• Urbanization and Growth on a Finite Planet• International Environmental Security• National Climate Assessment • Water Management• Adaptation to Protect Security in a Changing Climate • Renewable Energy on Institutional Property
Sign Up for Free SSF MembershipTo Access the Webinar Archives
www.securityandsustainabilityforum.org
Renewable Energy on Institutional Property Webinar Series Register at: www.ssfonline.org Energy Tab
Archived Webinars in the Series• June 2nd – Renewable Energy Policy• June 26th Webinar #1 – The US Federal Agency Market: Meeting Energy Reduction and
Renewable Energy Mandates• July 10th Webinar #2 – Renewable Energy Technology Applicability • July 24th Webinar #3 – The Effective Marriage of Renewable Energy and Energy
Efficiency in an ESCO Contract for Municipalities, and Educational and Hospital Campuses• August 7th - Webinar #4 – The Intersection of the Microgrid, Renewable Energy, and
Storage• August 21st Webinar #5 – Public Private Partnerships (PPP)
• September 4th Webinar #6 – The Leading Edge of New Energy Efficiency and Renewable Energy Technologies Coming to the Market
Registration Open• September 18th Webinar #7 – Developing the RFP
Gary Dirks, Ph.D. is the Director of the Julie Ann Wrigley Global Institute of Sustainability and Director of LightWorks, an Arizona State University initiative that capitalizes on ASU's strengths in solar energy and other light-inspired research. Before joining ASU, he was the president of BP Asia-Pacific and the president of BP China.
Meet the Panelists
Graham Stevens, Navigant Consulting Associate Director
Graham specializes in energy technology with particular expertise in photo voltaics, new products, and due diligence. He works closely with the research staff at Navigant Research and will be reporting on the latest information about renewables & energy efficiency technology. [email protected]
Otto Van Geet, National Renewable Energy Laboratory Senior Engineer.
Otto’s work has been concentrated in the Federal Energy Management Program. His expertise includes renewables screening and assessment, passive solar building design, use of design tools, photovoltaic (PV) system design for on and off grid applications, energy audits, and minimizing energy use and GHG generation for building and communities. [email protected]
Chris Brown, Sail Capital Partners Partner and Chief Scientist
Chris is a scientist and entrepreneur with a business and technical background. His past experiences have spanned multiple verticals, including electronics, textiles, and telecommunications. His background and experience position him at the crossroads of business and technology. [email protected]
Confidential and proprietary. Do not distribute or copy.
Payback and Market Penetration » Introduction
Navigant uses market penetration curves to assess how renewable and EE technologies are adopted over time.
• Market penetration curves (sometimes called S-curves) are well established tools for estimating diffusion or penetration of technologies into the market.
• A technology adoption curve provides the rate of adoption of technologies, as a function of the technology’s characteristics and market conditions.
• Navigant Consulting has gathered market data on the adoption of technologies over the past 120 years and fit the data using Fisher-Pry curves*.
• The Fisher-Pry technology substitution model predicts market adoption rate for an existing market of known size.
Sample Market Penetration Curves
*Source: Navigant Consulting, November 2008 as taken from Fisher, J.C. and R.H. Pry, A Simple Substitution Model of Technological Change, Technological Forecasting and Social Change, Vol 3, Pages 75 – 99, 1971 .
Confidential and proprietary. Do not distribute or copy.
Payback and Market Penetration » Payback Curves in the Built Environment
In the built environment, our S curves are based on the following payback acceptance curves to model consumer behavior:
Pay-Back Acceptance Curves
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0 2 4 6 8 10 12 14
Ultim
ate
Pe
ne
tra
tio
n [
%]
Payback Period (Years)
Residential
Commercial
Industrial
Curves assume 100% adoption is never
achieved due to unwillingness to change,
mistrust of a new technology,
incompatible building designs, etc. This is
based upon several prior Navigant
examinations of programs.
Source: Navigant based upon work for various utilities, federal government organizations, and state/local organizations. Thecurves were developed from customer surveys, mining of historical program data, and industry interviews.
Confidential and proprietary. Do not distribute or copy.
Glossary
1W One-way communication
2W Two-way communication
AC Alternating current
AH Air handler
AMI Advanced meter infrastructure
BIPV Building integrated photovoltaics
CAES Compressed air energy storage
Co-gen Co-generation
CPV Concentrating PV
DC Direct current
DEVAP Dessicant
DR Demand response
DSC Dye-sensitized cell
ERV Energy Recovery Ventilator
EV Electric vehicle
FLISR Fault location, isolation, and service restoration
HAWT Horizontal axis wind turbine
HEM Home energy management
HP Heat pump
HVAC Heating ventilating and air conditioning
IAQ Indoor air quality
Lidar Light detection and rangingMet Measurement towerMSW Municipal solid waste
MV Medium voltage
Na Sodium
Nat gas Natural gas
PEM Polymer electrolyte membrane
PM Preventative maintenance
PoE Power over EthernetPV Photovoltaic
RE Renewable
SaaS Software as a service
Sodar Sonic detection and ranging
Sodar Sonic detection and rangingUPS Uninterruptible power system
UVGI Ultraviolet germicidal irradiation
VAWT Vertical axis wind turbine
VR Voltage reduction
NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.
Renewable Energy Webinar #6: Buildings and Campus Carbon Neutral Strategies and Tools
Research campuses consume more energy per square foot than most facilities. They also have greater opportunities to reduce energy consumption, implement renewable energy systems, reduce greenhouse gas emissions, and set an example of climate neutrality.
The NREL Climate Neutral Research Campuses web site provides research campuses a five-step process to develop and implement climate action plans.
Confidential and proprietary. Do not distribute or copy.
REopt Planning Tool
Planning tool to evaluate RE, EE, microgrid, and operational energy opportunities
Recommends a mix of technologies and an operating strategy that meets client goals at minimum lifecycle costConsiders interactions between multiple technologiesEstimates costs and energy savings
Draws on site data, NREL GIS resource data, DSIRE incentive
database, and RE technology info
Has been used to assess opportunities at ~800 sites
Technologies currently modeled:PVWindSolar hot waterSolar vent preheatBiomassWaste to energyLandfill gasDiesel and natural gas generatorsBattery storage
SAIL Capital Partners LLCCalifornia | New York | Washington DC | New Orleans | Toronto
SAIL Capital Partners, LLC
Renewable Energy Webinar #6 The Leading Edge of New Energy Efficiency and Renewable
September 4, 2014
Chris Brown, PhDPrincipal
Table of Contents
37
I. Investment Landscape
II. Energy Efficiency at SAIL
III. Rating New Investment Opportunities
IV. SAIL Overview
I. Investment Landscape
38
Energy Efficiency Investment Landscape
39
DEALS: $639mm invested across 83 venture equity deals in 2014; 41 deals @ $269mm in second quarterTREND: Higher deal volumes and more capital-light deals Q1 THEME: Hardware focused building efficiency (lighting and windows) bringing in top deals; software solutions remain popular.Q2 THEME: Energy management systems from controls to energy dashboards experiencing high deal volume; energy efficiency financing platforms seeing interest from investors.
Energy Efficiency Deals
40
Home energy management companies received a lot of attention in the second quarter of 2014. Next Step Living, Cyclon Controls, and Energy Savvy saw huge investments, while large corporates teamed up with the likes of Lucibel, Wattio, and Panoramic Power for new partnerships. 2014 also saw larger growth equity deals go to makers of efficient building equipment, including View, and Phononic.
The Energy Efficiency sector has been in the spotlight lately with high profile IPOs and acquisitions, and the momentum is here to stay. The buzz around the “Smart Home” is a harbinger for a larger trend sweeping across the tech industry: the Internet of Things.
II. Energy Efficiency at SAIL
41
“Experts in airheater performance”
42
Paragon Airheater Technologies provides a suite of products and services that increase the efficiency of fossil fuel-fired powergeneration plants. The Company specializes in the service and manufacturing of high-performance seals and related replacement partsfor rotary, regenerative airheaters. The products maximize air preheater performance and efficiency through innovation, technology andquality service. Paragon’s products are one of the most important elements of energy efficiency in a typical power plant, contributing10‐15% to overall plant efficiency by recovering wasted flue gas heat and re‐using it to “pre‐heat” the external air pumped into theboiler during the combustion process. The seals reduce air leakage by an average of 35%, with a high-to-date reduction of 50%.
Business Overview
Paragon’s Value Proposition
• Lower emission and reduce carbon output by 2% - 3%
• Reduce fuel consumption by as much as 2%
• Extend the life of the Airheater
• Reduce maintenance cost
• Increase MW output
“World’s most efficient green motor”
43
SNTech is the fastest growing smart motor company in the world that develops low-cost, intelligent electric motors with enhancedefficiency. SNTech has several patents and develops an innovative product family of “smart” electric motors that deliver superiorperformance with 33-50% increased efficiency. These smart electric motors use up to 50% less electricity than high efficiency ACmotors. The Green Motor consumes 80% less energy and is the lowest heat emitting motor with 75% less heat generation. In2011, SNTech closed the acquisition of an electric motor product line from Regal Beloit Corporation. This move acceleratedSNTech’s entry into the fluid motor business.
Business Overview
Company Highlights
• Recurring revenue from over 100 customers in 2 years
• Sales growth from $1.2 million and 10,000 units in 2010 to over $21 million in 2012
• 3-year, $30M supply agreement with a Fortune 100 OEM
• Passed rigorous supplier testing and audits with major industry leader
• Advanced product development discussions with Top 5 HVAC OEM
• First-of-its-kind installation commissioned for a Fortune 100 company’s high efficiency data centers. The customer has asked SNTech to be their preferred vendor for smart motors
• Disruptive technology with 60+ Patents
• Finalized testing with DoD for Marine and Navy projects to fulfill energy efficiency mandates—recommended by expert consultant to US Navy
• Received its first multi-thousand unit order from a Fortune 100 OEM in Q2 2013
III. Rating New Investment Opportunities
44
The Rough Cut
45
MarketAre the market sizes compelling, and can the company economically scale to meet the demand that will arise?
ExecutivesDoes top management have a track record of success or is the advisory board strong?
AcceptanceHas the company identified the right customers, and does it understand why, when and how they buy?
TechnologyIs this technology disruptive and how much more time and cash are required to commercialize it?
QUANTIFY EVERYTHING
Market
46
Know the markets you want to enter.
• Compelling size, $B now or a market growing into it.
• Competition and alternatives.
• Market dynamics.
• Key customers and their power.
• Government regulations.
• Limiting factors, growth bottlenecks.
• Lead time to enter the market.
• Multiple market segments.
• Scaling with a cost structure that makes sense.
Executives
47
Build a team of leaders and advisors who know how to win.
• Management with a track record of success.
• Advisors with deep industry knowledge and contacts.
• Are the key positions properly filled? A founder is not always the best person to be CEO.
• Recalcitrant founders.
• A great advisory board validates strength of company and technology.
• Founders who understand trading ownership for value.
Acceptance
48
Know your customer and if they are really the right one.
• Who, what, when, where and why.
• The problem you are solving and how painful it is for them.
• Will they understand what you are trying to do?
• Who makes the buying decision?
• When do they buy and how long is the sales cycle?
• Just because the customer or market segment is the largest doesn’t mean it’s the right one starting point.
• Cash conversion is important; a small early adopter is worth more to a startup than a large late adopter.
• What metrics does my customer measure success by?
• Current backlog and pipeline.
Technology
49
Assess the strength of your technology versus others and over time.
• Is this technology game changing or just an iteration?
• Is this a platform technology?
• Has it been validated by a third party?
• How much development is left, at what cost and over what time?
• How much IP is currently there or coming? Is it broad based or just one application or material/molecule?
• Is the IP strong and defensible?
• Sustainable competitive advantage; will an alternative arise quickly?
SAIL was founded in 2002 as a pioneer in sustainable investment, with an emphasis on cleantech. Today it is recognized as a global leader with a unique combination of low loss experience and an innovative vision of technologies, markets and opportunities. SAIL invests in late stage growth companies with proven technologies, visionary leadership, and exciting growth potential.
• SAIL Venture Partners I, LP: Launched in 2003, 10 active portfolio companies
• SAIL Venture Partners II, LP: Launched in 2008, 13 active portfolio companies
• SAIL Sustainable Louisiana I & II, LP: Launched in 2011, first two closes successful, 5 Investments to date
• SAIL Pre-Exit Acceleration Fund , LP: Launched in Q4 2012, provides pre-exit capital to existing portfolio companies. Two companies taken public to date.
SAIL Total Assets Under Management (in $US millions)
3161 Michelson Dr., Suite 750Irvine, CA 92612949.398.5100 www.sailcapital.com
SAIL Capital Partners LLC
Panel Discussion
Within the realms of market, research, and investing, what are the top 5 most exciting opportunities that will unfold over the next 5 years?
What key trends will drive these innovations to market?
What are the key barriers to their commercialization?
Sign Up for Free SSF MembershipTo Access the Webinar Archives
www.securityandsustainabilityforum.org
Renewable Energy on Institutional Property Webinar Series Register at: www.ssfonline.org Energy Tab
Archived Webinars in the Series• June 2nd – Renewable Energy Policy• June 26th Webinar #1 – The US Federal Agency Market: Meeting Energy Reduction and
Renewable Energy Mandates• July 10th Webinar #2 – Renewable Energy Technology Applicability • July 24th Webinar #3 – The Effective Marriage of Renewable Energy and Energy
Efficiency in an ESCO Contract for Municipalities, and Educational and Hospital Campuses• August 7th - Webinar #4 – The Intersection of the Microgrid, Renewable Energy, and
Storage• August 21st Webinar #5 – Public Private Partnerships (PPP)
• September 4th Webinar #6 – The Leading Edge of New Energy Efficiency and Renewable Energy Technologies Coming to the Market
Registration Open• September 18th Webinar #7 – Developing the RFP