Panel: Houston's access to talent, strong network drives it as a city for scaling energy transition business

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At the GHP's Future of Global Energy event, panelists discussed the opportunities for scale in Houston. Photo by Natalie Harms/EnergyCapital

Time is of the essence when it comes to scaling energy transition businesses in Houston — at least that's what a group of panelists agreed on at a recent event from the Greater Houston Partnership.

The GHP's Future of Global Energy event, which took place on October 9, featured a panel entitled, "Epicenter of Energy Innovation for Scale" and was moderated by Barbara Burger, former president of Chevron Technology Ventures and current startup adviser and mentor. Joining Burger was Kristina Lund, president of Pattern Energy; Brooke Vandygriff, COO of HIF Global: and Bud Vos, CEO of MetOx International. All three companies have and plan to continue scaling in Houston.

The conversation covered some of the unique achievements each of the panelists' companies have reached recently, including HIF Global's millions raised to create e-fuels, MetOx's $25 million series B extension, and Pattern Energy's Southern Spirit project scoring $360 million from the Department of Energy to connect Texas's ERCOT to other states.

After covering the momentum each company has right now, Burger asked each of the panelists why Houston makes sense as a place for scaling their energy transition business.

"The U.S. has a great regulatory environment, ERCOT specifically. Texas is in the business of permitting projects," Vandygriff says. "If you take the right steps, you can get your permits. They are very responsive to attracting and recruiting businesses here."

Also attractive is Houston's existing energy workforce. Even when it comes to technology roles, Houston delivers.

"There is great tech talent here," Vos says, pointing out that Bill Gates called Houston the "Silicon Valley of energy" when he was here for CERAWeek. "I think there's an element of that that's very true. There's a lot innovation, there's a lot of creative thinking, and being able to come out of these businesses with huge momentum then go into startups and innovate is a culture change that I think Houston is going through."

The panelists, most of whom are not Houston natives, agreed in a welcoming culture within the business sector.

"I really think that Houston offers great hospitality, and the energy networks here are so strong," Lund says. "You feel the energy of the city."

In total, HIF has raised $200 million this year. Photo via hifglobal.com

Japanese agency invests $36M into Houston e-fuels company's portfolio

coming in hot

Houston-based electrofuel company HIF Global has secured a $36 million investment from the Japan Organization for Metals and Energy Security, a government agency.

The investment, made through an e-fuel subsidiary of Japanese energy company Idemitsu Kosan, is earmarked for HIF’s e-fuel projects in the U.S., Australia, Chile, and Uruguay.

Earlier this year, Idemitsu led a $164 million investment round in HIF. Of that amount, Idemitsu chipped in $114 million. Other investors included Houston-based Baker Hughes along with AME, EIG, Gemstone Investments, and Porsche.

In total, HIF has raised $200 million this year.

“Japan set a priority for the commercial introduction of e-fuels into its fuel supply to support their mandate for 46 percent [greenhouse gas] emissions reduction by 2030. We have already proven e-fuels are a real solution with over 18 months of e-fuels production from our Haru Oni facility in southern Chile,” says Cesar Norton, president and CEO of HIF.

In 2023, Idemitsu agreed to buy e-methanol from HIF’s $6 billion plant in Matagorda County. HIF says the plant will be the world’s first large-scale e-fuel facility. The plant is expected to produce about 1.4 million metric tons per year of e-methanol and about 300,000 metric tons of green hydrogen per year by 2027.

HIF, founded in 2016, aims to produce 150,000 barrels per day of e-fuel and recycle 25 million metric tons per year of carbon dioxide by 2035. E-fuels, which are synthetic alternatives to fossil fuels, include e-gasoline, e-diesel, and e-sustainable aviation fuel converted from e-methanol.

Using electrolyzers powered by renewable energy, HIF begins the e-fuel process by separating hydrogen from oxygen in water. The company then couples the resulting green hydrogen with recycled carbon dioxide to create carbon-neutral e-fuels.

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Fervo Energy bumps up IPO target to $1.82B

IPO update

Houston-based geothermal power company Fervo Energy is now eyeing an IPO that would raise $1.75 billion to $1.82 billion, up from the previous target of $1.33 billion.

In paperwork filed Monday, May 11 with the U.S. Securities and Exchange Commission, Fervo says it plans to sell 70 million shares of Class A common stock at $25 to $26 per share.

In addition, Fervo expects to grant underwriters 30-day options to buy up to 8.33 million additional shares of Class A common stock. This could raise nearly $200 million.

When it announced the IPO on May 4, Fervo aimed to sell 55.56 million shares at $21 to $24 per share, which would have raised $1.17 billion to $1.33 billion. The initial valuation target was $6.5 billion.

A date for the IPO hasn’t been scheduled. Fervo’s stock will be listed on Nasdaq under the ticker symbol FRVO.

Fervo, founded in 2017, has attracted about $1.5 billion in funding from investors such as Bill Gates-founded Breakthrough Energy Ventures, Google, Mitsubishi Heavy Industries, Devon Energy (which is moving its headquarters to Houston), Tesla co-founder JB Straubel, CalSTRS, Liberty Mutual Investments, AllianceBernstein, JPMorgan, Bank of America and Sumitomo Mitsui Trust Bank.

Fervo’s marquee project is Cape Station in Beaver County, Utah, the world’s largest EGS (enhanced geothermal system) project. The first phase will deliver 100 megawatts of baseload clean power, with the second phase adding another 400 megawatts. The site can accommodate 2 gigawatts of geothermal energy. Fervo holds more than 595,000 leased acres for potential expansion.

Cape Station has secured power purchase agreements for the entire 500-megawatt capacity. Customers include Houston-based Shell Energy North America and Southern California Edison.

Modular nuclear reactor company opens office in Houston

new to hou

The nuclear energy renaissance continues in Texas with an announcement by NuScale Power. The Oregon-based provider of proprietary and innovative advanced small modular reactor (SMR) nuclear technology announced in April it would be opening office space in Houston’s CityCentre.

“Opening this space in Houston underscores our commitment to meeting rising energy demand with safe, scalable nuclear technology,” John Hopkins, NuScale president and CEO, said in a news release. “This move expands our presence in a key market for partners, prospective customers, and stakeholders in addition to positioning us for the future as we focus on the near-term deployment of our industry-leading technology. Texas is leading the way in embracing advanced nuclear for grid resilience and industrial decarbonization, and we’re proud to expand our footprint and capabilities in this important region.”

Interest in nuclear power has been growing in recent years thanks to tensions with oil-rich nations, concerns about man-made climate change from fossil fuels, and the rapidly increasing power needs of data centers. Both Dow and Texas A&M University have announced expanded nuclear power projects in the last year, with an eye of changing the face of Texas’s energy industry through smaller, safer fission reactors.

Enter NuScale, founded in 2007 from technology developed at the University of Oregon. Their modular SMR technology generates 77 megawatts and is one of the only small modular reactors (SMR) to receive design approval from the U.S. Nuclear Regulatory Commission (NRC). These advances have led to runaway success for NuScale, whose stock has risen by more than 1,670 percent since the start of 2024.

The new operations campus in CityCentre is expected to facilitate the movement, installation and coordination of NuScale technology into the various energy systems. Typically, SMRs are used for off-grid installations, desalination operations, mining facilities and similar areas that lack infrastructure. However, the modularity means that they can be easily deployed to a variety of areas.

It comes none too soon. ERCOT projects that Texas data centers alone will require 77,965 megawatts by 2030.

Houston battery recycling company secures $32M in financing

fresh funding

Houston-based Ace Green Recycling has raised $32 million in private investment in public equity (PIPE) financing to support its future plans for growth.

The battery recycling technology company secured the financing with Athena Technology Acquisition Corp. II, a publicly traded special purpose acquisition company that Ace previously announced it plans to merge with. Once the merger is completed, Ace will become a publicly traded company on the Nasdaq Stock Exchange under the ticker symbol "AGXI."

Ace says the financing will be used to complete the merger and scale the company.

“This investment accelerates our mission to redefine battery recycling at a global scale,” Ace CEO Nischay Chadha said in a news release. “At Ace, we are deploying Greenlead® and LithiumFirst™ as a new standard–fully electrified, Scope 1 emissions-free solutions designed to replace legacy processes and unlock a cleaner supply chain for critical materials. We believe that the future of electrification depends on how efficiently and sustainably we recover these resources, and this milestone brings us meaningfully closer to that future.”

Ace says the funding will also be primarily used to fund capital expenditures related to the development of its planned flagship recycling facility, located outside of Beaumont, Texas. According to a February investor presentation, the facility is expected to launch in 2027. It will recycle lead-acid and lithium-ion batteries.

Ace agreed to a 15-year battery material supply agreement with Miami-based OM Commodities last year, in which OM Commodities would supply Ace with at least 30,000 metric tons of lead scrap to be recycled annually. Switzerland-based Glencore plc agreed to a 15-year offtake agreement to purchase up to 100 percent of ACE’s products from four of its planned lead-acid and lithium-ion battery recycling parks back in 2022.

Ace also reported that the funding will be put toward "supporting the expansion of operations and to fund the purchase of other companies," in the release.

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