Danny Kennedy, CEO of New Energy Nexus says his money is on young energy insurgents making a lot of history in a short period of time.
Note: Watch this space for a new monthly column by New Energy Nexus’ Danny Kennedy showcasing innovative startups to watch.
I know from experience that if you want to beat the climate inaction blues, a talk with Danny Kennedy will do the trick. I first met Danny Kennedy in Rio de Janeiro, Brazil at the first Earth Summit way back in 1992. He was an incredibly young 21 years old, from Australia and full of ideas and enthusiasm.
Now it’s 2021 and Danny is still full of ideas and enthusiasm despite the increasingly bleak outlook for positive climate action. The happy climate warrior is using his considerable energy, and networks, to support clean energy startups and entrepreneurs around the world at New Energy Nexus. I caught up virtually with him over an all-American Pabst Blue Ribbon beer for him (because, he says, it’s the closest thing to a good Aussie lager) and a morning coffee for me in Sydney as the climate world heads to COP26.
When I ask him why he is so optimistic in a summer of unrelenting bad news, he launches right in with what is nothing short of full-scale optimism.
“The most exciting thing for us right now is the EV Open Innovation Challenge we’re running in the States in a partnership with Hyundai looking for great startups providing easy charging solutions for customers,” Danny said. “We’re hoping to crack open commercial-ready EV charging products and services to develop at scale because charging concerns and anxiety are the big barriers to faster take-up of EVs.”
Danny says the winners of this challenge, like a similar FinTech challenge his organization launched during Climate Week to advance clean energy adoption, will get support and investment opportunities to help innovators and entrepreneurs develop their ideas and bring them to market.
“For us, there’s never a dull moment and that’s great,” Danny said.
“We probably see most of the clean energy entrepreneurs in the world.”
New Energy Nexus is an international, non-profit organization supporting clean energy entrepreneurs with funds, accelerators and networks. It was launched in California in 2004 and now has programs in New York, China, India, Southeast Asia and East Africa. So far this year, New Energy Nexus has helped bring grants and investments of $26 million to startups in 10 countries. To date, it has provided hundreds of millions of funds to startups in over 40 countries.
“This year we’re directly supporting about 452 companies and startups in different programs in 10 countries,” he said. “We deal with dozens of inbounds a day and some of our programs attract thousands of fantastic ideas. Some are new, some are repeat customers looking for support. In fact, we probably see most of the clean energy entrepreneurs in the world.”
At a time when climate change policy is stalling or being watered down Danny’s work is all about good news stories.
“We exist to support diverse entrepreneurs, to drive innovation and build equity into the process,” he said. “That means training entrepreneurs, supporting them with mentors, making connections, and not just those involving financial capital, which is increasingly abundant. It’s also about the social and emotional support we help bring to a startup to see them succeed.”
“We’ll take all the support we can muster for the startups we get behind,” he said. “There’s magic in it. I’ll be honest. It’s less science and more art in mashing things together and finding the synergies.”
I ask Danny if he’s got a favorite startup at the moment.
“I can’t have favorites,” he says. “But I really like a company called Cuberg, which we supported in 2017 when they were very small. They had an innovative new lithium metal solution for a component of the standard lithium-ion battery [often used for renewable energy storage]. After us, they attracted investment from Boeing HorizonX Ventures, which helped get them to some size and seriousness. They were just acquired by NorthVolt, which is the giant European company that’s going to service the battery needs of VW and other carmakers. This is a little company that we put through a pre-prototype funding program with an accelerator to boot. It’s a great story.”
Danny tells me that Cuberg’s second round of support from New Energy Nexus came from a program called the California Test Bed (CalTestBed). It is hosted by New Energy Nexus and the Los Angeles Cleantech Incubator with the University of California Office of the President and was established to speed up clean energy technologies’ commercialization in California. At the CalTestBed inaugural event, more than $6 million was awarded in vouchers to 26 clean energy entrepreneurs for testing by students and faculty on campuses up and down the Golden State.
“For Cuberg it was just four years from finding them to now, where they are looking to build gigafactories based on their technology,” he said.
“On climate change, we need to make a lot of history in a short period of time.”
“We recently nominated Reeddi, one of our Nigerian-based startups, for the global Earthshot Prize,” Danny said. “They are making a portable and swappable battery solution for solar products. It can be used in cold-chain systems to ship COVID vaccines, which is critical for places across Africa.”
Next Danny tells me about a company pioneering ocean-mounted photovoltaics on an Indonesian island that is getting noticed by investors. “Once you’re putting PV on the sea, the cost structure of that power is remarkably low,” he said. “That kind of blows my mind as a concept. We never really contemplated it before.”
See our related story on Ten Young Entrepreneurs to Watch developed with Danny Kennedy and New Energy Nexus.
Danny and I wander into discussing various new innovations and I ask him about green hydrogen. Given the incredible amount of renewable energy needed to make it, will it take big mining companies to make it possible?
“I see hydrogen as a byproduct of electricity produced by renewables, which will become superabundant because that’s the most logical way to build it out. We will overbuild solar and wind this decade because that’s the lowest cost way to produce electricity for the demands we have,” he said. “With the overbuild, there will be massive surpluses of electricity, which we’ll use for things like hydrogen. And the more you make it, the lower the cost becomes.”
“But if you’re asking me if I’d bet on the incumbent or the insurgent in the innovation battle, history shows it’s the insurgents that bring about the change that makes history,” said Danny. “Another startup, Enapter, that went through our Excel Accelerator in China in 2020, just won the Earthshot for their AEM electrolyzer. You don’t see mining or oil giants developing tech like this so quickly. On climate change, we need to make a lot of history in a short period of time.”
“Wireless and cashless is how we’ll actually finance most new clean energy.”
With the speed of new low carbon solutions emerging, I ask Danny why so much time has been wasted on technologies that don’t reduce emissions and some that don’t even work. He tells me that he’s watched bad ideas emerge because of bad government policy for decades. Billions of dollars have gone into the promise of technologies that will keep fossil fuels going like carbon capture and storage (CCS), rather than deliver “no carbon” solutions.
“The whole CCS process makes no sense,” he said. “You’re literally digging the stuff up, taking it somewhere to burn it, then you’re capturing emissions and taking it back and burying it? That just sounds expensive to me.”
On to the big ethical questions: Is it possible with young entrepreneurs popping up around the world that we might move from centralized, Western ownership to shared ownership with developing countries that have the opportunity to skip past coal, oil and gas to clean energy?
“I believe that fossil fuels inherently concentrate ownership and wealth in pockets, in certain places and people –– you could use the word colonialism,” Danny said. “What’s amazing about sunshine is that it falls pretty evenly on the earth and that provides a lot of opportunity for change.”
“We’re in a phase of what I call disruption-as-usual … everywhere.”
Danny said it is young people who should be supported to succeed in the race for climate solutions. “For them, the ownership and motivation are enormous. We’re definitely seeing a 20 to 30 something bias. And of course we are! It’s their survival at stake.”
In emerging energy markets in Africa, India and Southeast Asia, Western ways of financing projects and paying for energy aren’t needed or wanted according to Danny. “Wireless and cashless is how we’ll actually finance most new clean energy.”
Danny paints an exciting global picture of a rapidly changing landscape that is being driven by climate solutions.
“In emerging markets and developed countries, the genie is already out of the bottle,” Danny said. “We’re in a phase of what I call disruption as usual or DAU … everywhere.”
Bring on the brave new world of climate solution innovation.