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Nov 1, 2022

StartGreen provides funding for three impact domains: circular economy, diversity & inclusiveness and the energy transition. Coenraad de Vries, co-founder and Managing Partner of StartGreen is convinced that the energy transition can still succeed in time, but ir requires everything and everyone to contribute.

Corrigible optimists

'There are incorrigible optimists who firmly believe that everything will be alright. And then there are ‘corrigible’ optimists who are willing to concede that, while everything might be all right in the end, we’re going to have to roll up our sleeves and get on with it. I’m one of the latter. If we all keep taking sensible steps in the decades to come, I believe it is possible to create a completely fossil-free energy supply.

Tackle everything

It is possible, but we’re all going to have to put our shoulders to the wheel and tackle all aspects: energy generation, infrastructure and consumption. Not only by installing more solar panels and wind farms but also by addressing energy storage and consumption. Energy storage needs to be improved because renewable energy is not always in line with consumption; unfortunately, the sun doesn’t always shine. But there are also plenty of gains to be made when it comes to the consumption side. We are used to always having power and plugging in appliances when it suits us. High energy prices are making us face the facts. We are used to having our devices available all day and night. If we would start using more devices during the day, when there is a lot of sun and wind, that would solve part of the grid congestion problems.

The good thing about this impact domain is that we invest in the entire range of sectors: generation, storage & supply and consumption. There is not one holy grail: we cannot solve the issues with the sun, wind or hydrogen alone. Everything is necessary, including the more controversial sources, like biomass and nuclear energy. Our Director of Participations, Karel Asselbergs, puts it well in his blog The success is in the mix. It goes without saying that we have to make sensible choices. When it comes to biomass, for instance, we have to be sure that it is residual wood that doesn’t have to come from far afield.

Smart solutions

Because several roads lead to Rome, we invest in solutions that immediately realize the greatest possible CO2 reduction per euro invested, as well as in technological innovations that can make a significant contribution in the future. For example, in innovations in the field of storage and in smart IT solutions to better match supply and demand (smart grids). But also in smart solutions on the side of the users, ones that will ensure that we consume less energy and do so when it’s available.

Read more about this in the expert blog: 'Energy innovations are essential for the success of the transition'

We also invest in making real estate sustainable. Eighty per cent of energy consumption in the Netherlands is gas used for heating. That is why we invest in geothermal heat, heat pumps and hydrogen solutions, and by doing so we are one step closer to becoming a gas-free society.

Making the difference

For all our financing we look for entrepreneurs and project developers that want to make a difference. Our search for investment opportunities is wide and we don’t exclude any sectors, as innovations often also transcend sectors. We mainly look at the problem that the innovation intends to solve and whether it is feasible. We then examine how we can invest in those innovations so that they can be rolled out on a grander scale.

In doing so, we consider each time: will this really help us with the transition? But also: are we still needed here? We notice, for example, that we need less for innovations in solar and wind technology. These markets have already been developed in such a way that large industrial parties can finance the follow-up innovations. We are therefore focusing on new segments, such as CO2-neutral mobility and solar energy storage.

Closing the funding gap

Closing the funding gap Our main aim is to benefit the funding chain by financing those companies that need it, because mainstream financiers are not set up for higher risk and customised work. We fund the high-risk initial phase, helping the entrepreneur to get through the funding gap and with that we are essentially the catalyst that can get a start-up or fledgling energy project on track. With our knowledge and experience, we can properly assess the likelihood of an impact company’s technological and economic viability. We are also in a position to explain what the risk-return ratio is.

Because StartGreen has various financing instruments at its disposal, we can provide customised financing solutions: we can join the various pieces of the puzzle, namely (subordinated) borrowed capital, equity and (convertible) loans. We are unique in that respect. Once we have laid the foundation, other financing partners can get on board.

You might want to read: Project financing, an indispensable tool for the energy transition

Less dependent

In 2021 we were not aware that Putin was about to shut off the gas pipeline. That has made energy transition even more urgent. And this is not only from the perspective of sustainability; we now recognise how dependent we are on countries that we don’t want to be dependent on. That is why I am even prouder that we are helping to make energy transition possible.'

This blog appeared in our Impact Report 2021.



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