hou knew?

Calling all energy startups, Amazon enters the DAC chat, and more things to know this week

Events not to miss, nomination deadline for awards program for innovative energy businesses, and more things to know this week. Photo via Getty Images

Editor's note: It's a new week — start it strong with three quick things to know in Houston's energy transition ecosystem. Submit an energy transition company to an awards program, read how Amazon entered the DAC conversation, and learn about events not to miss this week.

Houston Innovation Awards nominations coming to a close

Photo via Getty Images

If you haven't heard, EnergyCapital's sister site, InnovationMap, is accepting nominations for the 2023 Houston Innovation Awards. The deadline to submit is tomorrow, September 19, and there are several categories that might be of interest to the Houston energy transition ecosystem, such as:

  • Hardtech Business, honoring an innovative company developing and commercializing a physical technology
  • Digital Solutions Business, honoring an innovative company developing and programming a digital solution to a problem in an industry
  • Sustainability Business, honoring an innovative company providing a solution within renewables, climatetech, clean energy, alternative materials, circular economy, and beyond
  • Corporate of the Year, honoring a corporation that supports startups and/or the Houston innovation community
  • People's Choice: Startup of the Year, selected via an interactive voting portal during the event
Now, these are only a few categories this year. To submit a nomination and read more about the awards, click here.

Events to have on your radar

Photo courtesy of The Cannon

  • September 21 — The Rice Alliance Energy Tech Venture Forum is an opportunity to learn about the latest emerging technologies, meet investors to seek funding, see promising companies, and more. (Note: I'm moderating a panel about venture investment at 2 pm)
  • September 21 — UH Energy Symposium, a panel series, is hosting its next installment, entitled Plastics, Chemicals, Circularity: What's Next?
  • September 28 — Chevron Technology Ventures seeks to identify novel technologies and innovation systems that stand to transform and improve facility-focused operational efficiencies, via the Chevron Technology Ventures Pitch Competition. Six Houston companies will compete to win a tailored field trial opportunity with CTV experts, plus a six-month, complimentary, flexible-workspace membership at The Cannon.

Amazon makes investment in direct air capture by way of Houston-based Oxy

Photo via 1pointfive.com

Houston-based cleantech company 1PointFive is among the recipients of e-commerce giant Amazon’s first investments in carbon-fighting direct air capture (DAC).

Amazon has agreed to buy 250,000 metric tons of carbon removal credits from Stratos, 1PointFive’s first DAC plant, over a 10-year span. That commitment is equivalent to the amount of carbon stored naturally across more than 290,000 acres of U.S. forecasts, says Amazon.

As Amazon explains, DAC technology filters CO2 from the atmosphere and stores it in underground geological formations. Aside from being stored, removed carbon can be used to make building materials like bricks, cement, and concrete. Read more.

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A View From HETI

Fervo Energy has closed financing to support the remaining construction costs for the first phase of Cape Station. Photo via fervoenergy.com

Houston geothermal unicorn Fervo Energy has closed $421 million in non-recourse debt financing for the first phase of its flagship Cape Station project in Beaver County, Utah.

Fervo believes Cape Station can meet the needs of surging power demand from data centers, domestic manufacturing and an energy market aiming to use clean and reliable power. According to the company, Cape Station will begin delivering its first power to the grid this year and is expected to reach approximately 100 megwatts of operating capacity by early 2027. Fervo added that it plans to scale to 500 megawatts.

The $421 million financing package includes a $309 million construction-to-term loan, a $61 million tax credit bridge loan, and a $51 million letter of credit facility. The facilities will fund the remaining construction costs for the first phase of Cape Station, and will also support the project’s counterparty credit support requirements.

Coordinating lead arrangers include Barclays, BBVA, HSBC, MUFG, RBC and Société Générale, with additional participation from Bank of America, J.P. Morgan and Sumitomo Mitsui Trust Bank, Limited, New York Branch.

“As demand for firm, clean, affordable power accelerates, EGS (Enhanced Geothermal Systems) is set to become a core energy asset class for infrastructure lenders,” Sean Pollock, managing director, project Finance at RBC Capital Markets, said in a news release. “Fervo is pioneering this step change with Cape Station, a vital contribution to American energy security that RBC is proud to support.”

The oversubscribed financing marks Cape Station’s shift from early-stage and bridge funding to a long-term, non-recourse capital structure, according to the news release.

“Non-recourse financing has historically been considered out of reach for first-of-a-kind projects,” David Ulrey, CFO of Fervo Energy, said in a news release. “Cape Station disrupts that narrative. With proven oil and gas technology paired with AI-enabled drilling and exploration, robust commercial offtake, operational consistency, and an unrelenting focus on health and safety, we have shown that EGS is a highly bankable asset class.”

Fervo continues to be one of the top-funded startups in the Houston area. The company has raised about $1.5 billion prior to the latest $421 million. It also closed a $462 million Series E in December.

According to Axios Pro, Fervo filed for an IPO that would value the company between $2 billion and $3 billion in January.

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