Impact Report 2023

Nysnø

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I am thrilled to present our 2023 Climate Impact Report, which celebrates the inspiring work of our portfolio companies and funds as they take decisive steps to reduce future greenhouse gas emissions—a concept we refer to as "avoided emissions." This report not only highlights their contributions but also underscores a growing shift in the investment landscape. Investors are increasingly prioritizing emission reduction, and we believe that in the years to come, avoided emissions will become a crucial metric for evaluating company performance, with significant financial implications.

By 2050, it is estimated that 7% of the world’s energy supply will come from rooftop solar panels. Otovo enables homeowners to invest in solar panels and batteries through their marketplace and collaboration with installers.

The phasing in of renewable energy will require better utilisation and flexibility in the power grid. Smart grids increase the implementation of and access to renewable energy. eSmart’s AI products dramatically improve operations.

Sensors can promote resource efficiency in both energy and physical supply chains. Disruptive Technnologies’ sensors collect data continuously and deliver insights to an analysis tool chosen by the user. Large-scale trials in commercial buildings show energy savings of 30-50% related to lighting using sensors alone. The result is a smarter use of resources, where companies and individuals can make decisions based on secure data, thereby reducing consumption and improving efficiency. 

Solar energy from both solar parks and roof-mounted solar panels is expected to make up a significant part of the world’s energy supply by 2050. According to the IEA’s projections, solar energy will account for 60% of the global increase in renewable energy of 1200 GW over the next 5 years. NorSun produces high-efficiency monocrystalline silicon wafers with one of the world’s lowest C02 footprints.

Blue and green hydrogen as an energy carrier can reduce greenhouse gas emissions in sectors that are difficult to transform to zero emissions in other ways, such as heavy transport, heating and the process industry. ZEG develops and manufactures plants that can produce hydrogen from natural gas (blue hydrogen) or biogas (red hydrogen) with integrated carbon capture.

The agricultural sector is responsible for 23% of global greenhouse gas emissions, and requires more efficient and sustainable practices to meet growing demand while reducing emissions. Thorvald, a battery-powered autonomous tractor, contributes to increased yields and a reduced greenhouse gas footprint by replacing pesticides against powdery mildew with the use of UV light. 

HIPtec manufactures high-quality, advanced metal components with a low CO2 footprint by combining high pressure with high temperature. Compared to traditional production methods, costs are lower – and material consumption, energy consumption and greenhouse gas emissions are significantly reduced

Cenate produces advanced nanoparticles of silicon that can increase the energy density of lithium-ion batteries. This contributes to a reduced need for synthetic graphite, which is currently a very emission-intensive material to produce.  With cheaper and more efficient batteries in electric vehicles, the technology contributes to increased electrification globally.

Green transport is crucial for Norway’s goal of halving emissions by 2030. NFI aims to reduce emissions per nautical mile by 6% annually.

The need for more sustainable solutions and new business models is great in the mobility sector. Electric passenger cars and their availability play a key role in achieving climate goals. Casi’s car subscription services provide the necessary flexibility to meet modern customer expectations.

Industrial heating processes are currently mainly powered by fossil fuels, and therefore account for a significant share of greenhouse gas emissions globally. The IEA estimates that heat accounts for about half of global energy consumption, half of which consists of industrial heating processes. Heaten supplies an electric heat pump, which can be used for temperatures between 80 and 200 degrees Celsius, thus helping to replace gas combustion in this segment.

Morrow develops and supplies next-generation batteries with a new and innovative cathode material (LMNO). These batteries replace cobalt, reduce nickel and lithium, and maximize the use of pure and abundant manganese.

Through smart cameras, Spoor can visualize the bird’s actual and expected flight path. Their solutions will help protect bird life, facilitate more efficient planning and operations of wind energy, and thus reduce greenhouse gas emissions.

Ducky’s technology quantifies greenhouse gas emissions, and their applications provide users with insight into the climate impact of their own consumption. The company has developed three products aimed at businesses, the public sector and consumers.

Amina sells simple, safe and affordable electric car chargers. Amina’s enabling climate technology will be part of the solution towards electrifying the global car fleet. 

Vårgrønn is one of the largest owners of Dogger Bank (UK). Upon completion, Dogger Bank will be one of the world’s largest offshore wind farms with an installed capacity of 3.6 GW. 

The clothing industry accounts for 10% of the world’s greenhouse gas emissions, and has major consequences for water consumption, pollution and waste. Tise facilitates that a larger proportion of clothing is purchased through a circular business model, which is important for achieving global climate goals.

The rare earth value chain is currently heavily concentrated in China, with an 80-90% market share. Today’s processing is highly emission-intensive, and REEtec estimates that its new process, where virtually all input factors are reused, will reduce CO2 emissions by 90% compared to other leading players.

Metizoft – Norwegian Maritime Exporters

3% of global greenhouse gas emissions come from nearly 130,000 ships. Metizoft delivers a software solution that provides an overview of greenhouse gas emissions from construction, operation and disposal. The software makes it possible to identify measures in the design, operation and disposal of components to reduce emissions from the maritime industry.

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The investment focus is on technologies and businesses that create value through a focus on sustainability. The fund invests in clean energy and health companies.

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The investment focus is technologies in renewable energy, energy storage, mobility, advanced materials, resource efficiency, technology in food and agriculture.

EIP is a technology-focused venture investor that invests in companies in electrification, renewable and distributed power generation, intelligent operations solutions, mobility, smart homes and cities, and cybersecurity.

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The fund will look for digital business models in renewable energy, aquaculture, health, the maritime sector and finance, and invest where there is a positive contribution to one or more of the Sustainable Development Goals.

The world’s food systems account for over a third of global greenhouse gas emissions, and consume more and more energy. The fund will invest in technology-driven companies that contribute to a sustainable food system from production and distribution to consumption.

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Hydrogen can be an important energy carrier for reducing greenhouse gas emissions in sectors where direct electrification is demanding, such as industrial processes and long-distance transport.

Disease, parasites and damage to farmed fish are just some of the sustainability challenges facing today’s seafood industry. In addition, the world needs proteins with a lower environmental and climate footprint to feed an ever-growing population. By investing in companies that offer solutions to these challenges, Bluefront contributes to reduced greenhouse gas emissions both directly and indirectly.

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The energy sector will be transformed, and new innovative solutions and climate technology are needed to replace fossil fuels, find better solutions for renewable energy and promote energy efficiency. If we solve this, it will result in major reductions in greenhouse gas emissions

According to the United Nations, urban environments and urban activities are responsible for approximately 75% of global CO2 emissions, consuming over two-thirds of the world’s energy. The enormous climate footprint is mainly due to suboptimal planning, infrastructure, and the use of fossil fuels. The investment focus is to find new ways to plan, build, manage and operate the world’s cities to achieve major greenhouse gas cuts.

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Renewable energy, electrification, and decarbonization are essential to reduce the world’s greenhouse gas emissions and reach net-zero by 2050. By investing in technology for energy transformation, sustainable consumption and sustainable societies, Verdane Idun I will contribute to direct and indirect reductions in greenhouse gas emissions.

In this emerging paradigm, companies and investors alike will be recognized and valued for their contributions to global emission reductions. As we move toward establishing a standard methodology for carbon accounting, we anticipate a powerful redirection of capital into ventures with measurable and meaningful climate impacts.

The fund’s investment universe will be centred around renewable power generation, battery production, offshore and onshore wind, hydrogen and ammonia production, and carbon capture and storage. All sectors that will be crucial to achieving deep decarbonization.

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All investments must have a growth potential in the investment areas of regenerate, improve and revitalise. This includes companies that solve challenges related to resource scarcity, greenhouse gas emissions, energy transformation, health and welfare.

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A two-pronged investment focus on climate and social sustainability. The fund’s focus on climate and the environment is focused on clean energy, electrification, industry and infrastructure, and food and agriculture.

The fund has several focus areas, including scale-up and growth companies in the green industrial transition. 

•	Expanded and improved emission reporting of our direct portfolio in collaboration with MoreScope.

•	Collected and reported financed emission data from 95% of our fund portfolio.

•	Hosted to workshop for our portfolio companies to encourage reporting on avoided emissions.

•	Reported avoided emissions from portfolio companies and our indirect investments through our fund portfolio.

Though calculating climate impact can be complex and challenging, this should not discourage us. Instead, it should fuel our commitment to seek the best solutions, refine our methods, and strive for accuracy. Addressing avoided emissions is indeed a nuanced topic, but it is an essential one as we aim to reshape industries and create a more sustainable future.

•	Assessed and quantified Nysnø‘s digital footprint.

•	Improved our emissions reporting accuracy, with 40.3% of our total emissions being activity-based. 

•	Established expectations to service suppliers on delivering 2023 emission report and collect more accurate emission data.

•	Expand the share of financed emissions from our fund portfolio.

This report marks an important step in our journey, and we are excited to share these insights with you.

•	Encourage more portfolio companies to quantify the climate effect from their services and solutions.

•	Encourage more fund portfolio companies to estimate future climate impact from their investments.

•	Thematic work towards our portfolio companies carbon debt for future emission calculations.

•	Improve own emission accounting by using more activity-based calculations and collecting the most precise emission data from suppliers

 Directly induced emissions from own operations. E.g. Own vehicles, machinery and production facilities.

 Energy consumption: Electricity, heating/cooling.

 Indirectly induced emissions: goods and service purchased and by the company. E.g.. services, waste management, business travel, transport and distribution and use of sold products. Divided into 14 sub-categories.

Calculates emissions directly from specific activities, like fuel consumption, electricity use, or transportation.

Requires detailed data on physical inputs (e.g., energy usage, fuel burned).

Generally more precise because it's based on real-time or historical activity data.

Estimates emissions based on the amount of money spent on goods or services, using average emissions factors for those purchases.

Relies on financial data, linking expenditures to emissions averages for various sectors.

Less precise than activity-based reporting, as it uses generalized emissions factors rather than specific operational data.

In 2021, 78% of our energy came from the combustion of fossil fuels such as coal, natural gas, and oil, according to the IEA. According to the IPCC, the combustion of fossil fuels in boilers and engines is responsible for the majority (approximately 80%) of greenhouse gas (GHG) emissions. This is the reason why fighting climate change has often been associated with the need for an 

Walking on the path to Net Zero Emissions (NZE) means that our energy needs to come from low-carbon energy sources. This mainly implies electrical sources such as solar and wind power. It also necessitates the replacement of boilers with heat pumps and fuel engines with electric motors. In one word: 

While low-carbon energy resources are theoretically unlimited, it is important to acknowledge that there is no such thing as a free lunch. The deployment of large-scale solar, wind, and nuclear energy will require time and resources, and it will always come with some form of footprint. That is the reason why, besides the electrification of everything, our energy intensity needs to be improved through 

Making EV charging simple, safe and affordable

Electrification of the transport sector will be crucial to achieving a definition society. In 2021, CO2 emissions from the transport sector amounted to nearly 8 billion tons, which corresponds to 20 percent of global emissions. Three quarters of these emissions are related to passenger and freight transport. The IEA estimates that passenger kilometers can double by 2070. Even with anticipated growth in transport demand, following the NZE Scenario requires transport sector emissions to fall by about 20% to less than 6 Gt by 2030. 

EY has estimated a European need for 13 million charging points by 2050 and 65 million by 2035, of which around 85% of these will be home chargers. To date, a few million EV chargers have been installed in Europe.

Amina is a Norwegian EV charging company that was established in 2021 with the ambition of commercializing and selling a simple, safe and affordable EV charger. Amina’s enabling climate technology will be part of the solution as the global car fleet becomes increasingly electrified.

Enables electric mobility by offering affordable charging points

Reducing the use of pesticides and fertilizers improves crop quality, reduces disease, and leads to healthier, more nutritious foods

Saga Robotics has developed the autonomous robot Thorvald – a unique farm robot. Thorvald is electric, autonomous and can solve numerous tasks within agriculture. Thorvald is currently used, among other things, to treat plants with UV light at night, which reduces the need for pesticides. In the future, Thorvald will be able to pick and harvest, simplify logistics, remove weeds and mow the grass. 

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Thorvald is generating avoided emissions by 43 to 261 tonne CO2 e per robot

Thorvald is battery-powered and significantly lighter than a diesel-powered tractor, resulting in reduced direct emissions. Thorvald contributes to a drastic reduction of pesticides and fertilizers whilst improving crop yield , efficient disease control and better food delivered to consumers. 

Reduces crop loss and related input factors

Replaces fossil fuels with battery electric power

Reduced need for seasonal workers commuting by aircraft

Starting production from the factory in Arendal in 2024. Developing the LMNO battery, free of cobalt and reduced nickel and lithium

Morrow is speeding up the energy transition with cost-effective and sustainable batteries. Batteries will play a crucial role in the energy transition through two key contributions: firstly, providing the renewable energy storage needed to balance an energy market increasingly reliant on intermittent energy sources such as wind and solar energy. Secondly, to enable the electrification of the transport sector by equipping electrical vehicles with cost-competitive batteries and sustainably produced batteries.

Starting production from the factory in Arendal in 2024. Developing the LMNO battery, free of cobalt and reduced nickel and lithium 

Based in Norway, Morrow is on a mission to develop and deliver nextgeneration batteries with a new and innovative cathode material (LMNO). These batteries replace cobalt, reduces nickel and lithium, and maximizes the use of clean and abundant manganese.

Reduces the amount of raw material input per component produced

Energy consumption is lower than comparable methods

Reduces weight for freight of manufactured components

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ArcTern‘s seek attractive financial returns through a portfolio of equity or equity-like investments in Earthtech startup companies primarily focussed on developing breakthrough solutions for solving climate change and sustainability

The first aspect of ArcTern’s investment screening criteria is environmental impact. ArcTern targets investments with an annual environmental TAM of 200+ megatonnes of greenhouse gas (GHG) emissions per year,the potential to reduce GHG emissions by 200+ megatonnes/year if the company achieved 100% market share. At the company level, the firm calculate GHG emission by identifying the GHG reduction factor per unit of production or service, which is derived from a combination of peer-reviewed academic research and company input. In addition to screening for environmental impact potential prior to investment, ArcTern monitors and reports ESG metrics post-investments across the portfolio in an annual Impact Report. Based on the 2023 Impact Report, we estimate that ArcTern’s Fund II portfolio will reduce 8 megatonnes of GHG emissions by 2025 (based on each company’s sales projections).

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Energy Impact Partners LP (EIP) is a global investment firm leading the transition to a sustainable future. EIP brings together entrepreneurs and some of the world's most forward-looking energy and industrial companies to advance innovation. With over $4 billion in assets under management, EIP invests globally across venture, growth and credit – and has a team of over 90 professionals based in its offices in New York, San Francisco, Washington D.C., Atlanta, Palm Beach, London, Cologne, Oslo and Singapore

The majority of EIP’s investments are focused on the decarbonization of energy systems. EIP classifies its portfolio companies across four impact themes: decarbonized supply, intelligent infrastructure, sustainable demand and foundational technologies. Other investment themes include decarbonization of the built environment or food and agriculture.

On an ownership-weighted basis, EIP enabled 1.5 million metrics tons of annual CO2e savings, 11.9 million metrics tons of lifetime CO2e savings from products or services sold during our ownership, and 10.2 million metric tons of planned CO2e savings during the first five years of commercialization for our pre-commercial technologies.

EIP’s impact report from 2023 can be downloaded 

Impact Report 2023

Introduction