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    Financing Clean Technology Ventures: Session-9 Vidheeavashia 3 S E Ptembe R, 2 0 1 9

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    The document discusses seven new types of investors that are fueling the renaissance in venture capital funding for clean energy technologies. It lists these seven types as asset-light investors, strategic investors, creative partnerships, foreign investors, place-based investors, patient investors, and philanthropic investors. It also provides examples and brief descriptions of each type.

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    Financing Clean Technology Ventures: Session-9 Vidheeavashia 3 S E Ptembe R, 2 0 1 9

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    The document discusses seven new types of investors that are fueling the renaissance in venture capital funding for clean energy technologies. It lists these seven types as asset-light investors, strategic investors, creative partnerships, foreign investors, place-based investors, patient investors, and philanthropic investors. It also provides examples and brief descriptions of each type.

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    The document discusses seven new types of investors that are fueling the renaissance in venture capital funding for clean energy technologies. It lists these seven types as asset-light investors, strategic investors, creative partnerships, foreign investors, place-based investors, patient investors, and philanthropic investors. It also provides examples and brief descriptions of each type.

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    35 views11 pages

    Financing Clean Technology Ventures: Session-9 Vidheeavashia 3 S E Ptembe R, 2 0 1 9

    Uploaded by

    Ronaky123456
    The document discusses seven new types of investors that are fueling the renaissance in venture capital funding for clean energy technologies. It lists these seven types as asset-light investors, strategic investors, creative partnerships, foreign investors, place-based investors, patient investors, and philanthropic investors. It also provides examples and brief descriptions of each type.

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    of 11

    Financing Clean

    Technology Ventures
    S ESSI ON -9
    V I DHE E AVA SH IA
    3 RD S E PTEMBE R , 2 0 1 9

    MANAGING ENERGY BUSINESSES 1


    Fuelling Clean Energy's VC Renaissance
    Traditional venture capital never was a good fit for energy technologies

    Venture capital is surging back into the energy sector it


    abandoned seven years ago

    Overall investment in clean energy dropped 8 percent in 2018, venture


    capital and private equity investment surged by 127 percent

    7 new types of VCs


     Asset-Light Investors - companies that don't have to spend a lot of
    money to build big manufacturing facilities – e.g. software
    companies – Digital Energy?

     Strategic Investors - strategic funds- utilities or energy companies or


    others who have a strategic motivation to deploy capital in addition
    to their financial one
    Source: https://www.forbes.com/sites/jeffmcmahon/2019/05/29/7-new-types-of-investors-fueling-clean-energys-venture-capital-
    renaissance/#3800830c5f55

    MANAGING ENERGY BUSINESSES 2


    Fuelling Clean Energy's VC Renaissance
    7 new types of VCs
     Creative Partnerships – early investors partner with later-stage funds

     Foreign Investors - cross-border investors from places in the world


    where electricity and other resources are a lot more expensive

     Place-Based Investors- e.g. Clean Energy Trust that is investing in the


    Midwest USA only

     Patient Investors - structured as a holding company which can buy


    companies and hold them forever if they want to

     Philanthropic Investors - family foundations that have a social or


    environmental mandate
    Source: https://www.forbes.com/sites/jeffmcmahon/2019/05/29/7-new-types-of-investors-fueling-clean-energys-venture-capital-
    renaissance/#3800830c5f55

    MANAGING ENERGY BUSINESSES 3


    Biogas
    Biogas refers to a gas produced by breakdown of organic matter in
    the absence of oxygen

    Selling & Trading


    Biogas plant

    Electricity
    Substrate

    Heat

    Biomanure Bio-CNG
    Gas grid
    Utilization of Biogas
    BIOGAS

    Drying, Gas conditioning with or


    Desulfurization without CO2 separation

    Reformation
    Compression (possibly)

    Boiler CHP
    Bottling or gas Filling Fuel
    grid station cell

    Heat Electricity &


    Heat Substitute for Fuel Electricity
    LPG or nature and heat
    gas
    Future tech??

    MANAGING ENERGY BUSINESSES 6


    Instruments to Promote
    Renewables

    MANAGING ENERGY BUSINESSES 7


    What drives Renewable energy?
    Government renewable capacity targets (e.g. Indian INDCs)
    Fossil fuel supply constraints
    • Higher imports
    • Capacity additions

    Time to market
    • Environmental clearances
    • Lack of dependency

    Water issues
    • Thermal plants closed during peak summer due water scarcity
    • Hydro plants closed during monsoons due excessive silt

    MANAGING ENERGY BUSINESSES 8


    What drives Renewable energy?
    Air pollution
    Carbon budget constraints
    Quantum of fossil energy prices going down, bad for
    renewables?
    Time of day pricing and renewables
    Grid stability issues (intermittency, assured intake - always?, how
    much is too much?)
    Preferential tariffs for renewables (until when? What capacity
    share?)

    MANAGING ENERGY BUSINESSES 9


    Incentives to Indian renewables
     Capex incentives
    • Capital subsidies
    • Accelerated Depreciation in wind projects reduced now (20% for the
    first year, 15% subsequently)
    • 80IA Income Tax Holiday for 10 years
    • MNRE Capital Subsidy offered for small hydro
     Operational incentives
    • Generation Based Incentive of 50p per unit for wind IPPs
    • Preferential Feed-in tariffs (FiT) for power produced from renewable
    sources
     Clean energy incentives
    • Renewable Purchase Obligations: SERCs to source specified percentage
    of electricity purchased from renewable sources
    • Renewable Energy Certificates (REC)
    • Carbon credits

    MANAGING ENERGY BUSINESSES 10


    Wind Repowering
    Indian wind turbine generators installed as of 31.3.2014
    • Below 500 kW individual capacity: 2.46 GW
    • 500 – 1 MW: 7.18 GW
    • 1-1.5 MW: 7 GW
    • 1.5-2 MW: 2.55 GW
    • Over 2 MW: 1.75 GW

    Some of the best wind sites were taken in initial years and thus
    are having small turbines (installed prior to 2002?)

    Repower? (yield to increase by over 2.5 times to make economic


    sense for replacement)

    MANAGING ENERGY BUSINESSES 11

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