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Houston facts

Report: Houston's energy transition economy sees momentum, including $6.1B in financing in 2022

Natalie Harms
Aug 7, 2023, 12:02 pm
According to the facts, Houston's energy transition is moving in the right direction. Photo via Getty Images

In Houston, the energy transition movement is in full effect — at least, according to the facts and figures from a recently released report.

The Greater Houston Partnership released its 2023 Houston Facts report, which analyzes the business community across sectors. The report highlights the fact that last year Houston's energy transition brought in $6.1 billion in financing from private market investments, which represents a 61.9 percent increase compared to 2021.

"Over the last five years, Houston has seen constant growth in annual energy transition investments, with a notable surge observed from 2020 onwards," reads the report.

Corporate and strategic merger and acquisition investments are what dominated the five deal types, according to the report, representing 68.8 percent of the total investment in 2022. Additionally, private equity accounted for 19.3 percent of all deals, with venture capital comprising 9.5 percent.

Source: GHP analysis of data from the U.S. Environmental Protection Agency, Greenhouse Gas Reporting Program (GHGRP)

According to Houston Facts, there are 550 Houston-based energy transition companies working in battery/energy storage, biofuels, carbon capture, use, and storage, circular economy, and other energy value chains.

The report also looked at clean energy job growth, which increased from 66,047 professionals in the Houston metro area in 2021 to projected increase to 71,305 jobs in 2022. The fastest growing type of clean energy job is within energy efficiency, a section that accounts for 68.1 percent of total clean energy employment last year, which increased 28.2 percent from 2021. Additionally, clean vehicle employment also saw a 14.7 percent increase while job counts in grid and storage and clean fuel applications declined notably in 2022, per the report.

Compared nationally, personal finance website SmartAsset recently ranked the Houston metro area as the fifth best place in the U.S. for green jobs, which pay an average of 21 percent more than other jobs. The SmartAsset study found that 2.23 percent of workers in the Houston area hold down jobs classified as “green.”

Source: GHP analysis and estimates of data from the U.S. Energy and Employment Report (USEER) and The Energy Futures Initiative (EFI), the National Association of State Energy Officials (NASEO), BW Research Partnership (BWRP) and E2 (Environmental Entrepreneurs)

The report also analyzed Houston's progress when it comes to emissions. Here are some of the Houston Facts on emission data from the U.S. Environment Protection Agency and the Greenhouse Gas Reporting Program:

  • Houston's power plant sector was as the largest greenhouse gas emitter with 43.2 percent of the region's total industrial emissions, and the sector has had an overall increasing trend over the past few years.
  • With 27.5 percent of industrial emissions, the chemicals sector came in No. 2, but the sector peaked in 2018, slightly declined in 2019, and have remained relatively constant through 2021.
  • Refineries ranked third, with for 21.2 percent of emissions, and have remained stable without notable increase over the past few years.
  • Petroleum and natural gas sector emissions have consistently increased since 2012, except for 2017. That year, Houston's overall emission rate reached its lowest point in the past decade at 225.1 mtCO2e.
  • Currently, Houston's emission rate is slightly below the highest point of the past ten years, which was 243.2 mtCO2e recorded in 2012.
Houston Facts, as well as other reports and resources, is available on GHP's website.
Energy EfficiencyGreen JobsHouston Energy TransitionClean Energy JobsGreater Houston Partnershiphouston facts

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Houston logistics company works toward software solutions to energy transition challenges

Matthew Costello, CEO and co-founder of Voyager Portal, joins the Houston Innovators Podcast. Photo courtesy of Voyager

For several years now, Matthew Costello has been navigating the maritime shipping industry looking for problems to solve for customers with his company, Voyager Portal.

Initially, that meant designing a software platform to enhance communications and organization of the many massive and intricate global shipments happening every day. Founded in 2018 by Costello and COO Bret Smart, Voyager Portal became a integral tool for the industry that helps users manage the full lifecycle of their voyages — from planning to delivery.

"The software landscape has changed tremendously in the maritime space. Back in 2018, we were one of a small handful of technology startups in this space," Costello, who serves as CEO of Voyager, says on the Houston Innovators Podcast. "Now that's changed. ... There's really a huge wave of innovation happening in maritime right now."

And, predictably, some of those waves are caused by new momentum within the energy transition.

"The energy transition has thrown up a lot of questions for everyone in the maritime industry," Costello says. "The regulations create a lot of questions around cost primarily. ... And that has created a huge number of opportunities for technology."

Fuel as a primary cost for the maritime industry. These cargo ships are traversing the world 24/7 and burning fuel at all times. Costello says there's an increased focus on the fuel process — "all with a goal of essentially reducing carbon intensity usage."

One of the ways to move the needle on reducing the carbon footprint of these ships is optimizing the time spent in port, and specifically the delays associated. Demurrage are charges associated with delays in loading and unloading cargo within maritime shipping, and Costello estimates that the total paid globally in demurrage fees is around $10 billion to $20 billion a year.

"These fees can be huge," Costello says. "What technology has really enabled with this problem of demurrage is helping companies drill down to the true root cause of what something is happening."

All this progress is thanks to the enhancement — and wider range of acceptance — of data analysis and artificial intelligence.

Costello, who says Voyager has been improving its profitability every quarter for the last year, has grown the business to around 40 employees in its headquarters of Houston and three remote offices in Brazil, London, and Singapore. The company's last round of funding was a series A in 2021. Costello says the next round, if needed, would be next year.

In the meantime, Voyager is laser focused on providing optimized, cost-saving, and sustainable solutions for its customers — around half of which are headquartered or have a significant presence in Houston. For Costello, that's all about putting the control back into the hands of his customers.

"If we think back to the real problems the industry faces, a lot of them are controlled by different groups and parties. The fact that a ship cannot get in and out of a port quickly is not necessarily a function of one party's issue — it's a multitude of issues, and there's no one factor," Costello says on the show. "To really make the whole process efficient end-to-end you need to provide the customer to access and options for different means of getting cargo from A to B — and you need to have a sense of control in that process."

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This article originally ran on InnovationMap.

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