LevelTen Energy, a Seattle startup making it easier for corporations to purchase renewable energy, has raised $6.8 million from investors.
LevelTen aims to give more companies access to the power purchase agreements that sophisticated energy buyers such as Microsoft (NASDAQ: [[ticker:MSFT]]) negotiate directly with wind and solar energy developers, rather than buying power through an electric utility. Last week, Microsoft announced a 15-year deal with GE (NYSE: [[ticker:GE]]) to purchase all the power generated by a 37-megawatt wind project in County Kerry, Ireland. More on that below.
Negotiating such large, long-term power contracts is beyond the abilities of many corporate energy purchasers, even though they have a growing appetite for the locked-in, competitive prices that wind and solar energy producers offer. Some of these buyers view the fact that these energy sources don’t contribute to global warming as an added benefit. Nearly 1,400 global companies now incorporate an internal price on carbon pollution in their business planning, according to CDP, a London-based nonprofit group tracking corporate climate change policy. That’s up from 150 companies that used an internal carbon price in 2014.
LevelTen aims to aggregate demand from these would-be buyers of cheap, clean energy, and contract directly with renewable energy producers to negotiate power purchase agreements.
LevelTen has been soliciting projects for its first portfolio, which the company says will be the “largest renewable energy solicitation in the country this year.” This distinction underscores the growing importance of corporate energy purchasers in the market. See this profile of LevelTen from May for more background on the renewable energy market dynamics shaping its business.
Investors in LevelTen’s Series A funding round include Prelude Ventures, Techstars Venture Capital Fund (LevelTen completed the Techstars Seattle accelerator earlier this year); Founders’ Coop; Wireframe Ventures; Element 8 Fund, which is attached to the Seattle-based cleantech angel investing group; and Avista Development, a subsidiary of Spokane, WA-based investor owned utility Avista Corp.
Microsoft Wind in Ireland
Microsoft, meanwhile, will purchase the output of GE’s Tullahennel wind farm in County Kerry, Ireland, to help power its cloud computing operations there. With the new project, Microsoft will have almost 600 megawatts of directly procured renewable energy.
As part of the deal, Microsoft purchased an energy supply license from GE and contracted with energy trader ElectroRoute. In effect, Microsoft will be positioned as an energy supplier, not just a power customer, which will give it “the flexibility to easily grow and invest in renewable energy in Ireland over time,” according to a Microsoft news release.
Furthermore, the project will employ a battery energy storage system integrated with each wind turbine—a first of its kind deployment in Europe, Microsoft says. Energy storage helps intermittent renewable energy resources provide more consistent output to the electricity grid.
Storage is an emerging strength of Washington state’s clean technology industry.
Photo credit: Photo by Thomas Richter on Unsplash
