Examining recent economic history reveals a nuanced narrative surrounding the trajectory of Cleantech, characterized by periods of growth, setback, and adaptation.

From 2006 to 2011, the emergence of Cleantech 1.0 marked a notable surge in investment efforts aimed at addressing environmental concerns. Cleantech, an umbrella term encompassing various innovations in the energy industry, such as renewable energy and resource efficiency, garnered significant attention and resources during this phase. However, the initial enthusiasm was later tempered by what is colloquially termed the Cleantech Bubble.

During the Cleantech 1.0 era, prominent ventures such as Solyndra (solar panel manufacturing) and KiOR (biofuels production) symbolized the aspirations and subsequent challenges of the movement. These companies, supported by substantial investments, initially highlighted promising solutions for energy-related issues. Nevertheless, their eventual downturn, marked by Solyndra’s bankruptcy filing in 2015 and KiOR’s similar fate in 2014, underscored the complexities and uncertainties inherent in Cleantech ventures.

Figure 1 – The burst in the Cleantech bubble

The decline of Cleantech 1.0 stemmed from a combination of factors, including the emergence of fracking, which introduced cheaper alternatives to renewable energy sources, and the reduction of government funding for clean energy initiatives. Additionally, heightened global competition, particularly from countries like China, posed challenges for sectors such as solar panel manufacturing. The venture capital model, though instrumental in the initial stages, revealed its limitations in supporting the prolonged and unpredictable development cycles of clean energy technologies, often leaving startups stranded in what is commonly referred to as the “valley of death” due to lack of “patient capital.” Post-mortem analyses, such as those conducted by the MIT Energy Initiative, advocated for a collaborative approach involving diverse stakeholders, ranging from corporations to hedge funds to affluent individuals. Indeed, Successful Cleantech 1.0 companies like SunRun instead utilized other forms of financing like debt.

However, the setbacks experienced during Cleantech 1.0 prompted a reevaluation and the birth of Climate Tech 2.0—a more expansive and inclusive approach to addressing climate change. Unlike its predecessor, Climate Tech transcends energy solutions to encompass innovations across multiple industries such as consumer goods, agriculture, manufacturing, and transportation (see our blogpost on the definition of Climate Tech here).

Zooming out, it becomes clear that investing in climate solutions demands an abundance of patient capital and a clear path to exit. The difficulties faced by Cleantech 1.0 companies in securing late-stage equity financing and viable exit strategies underscored the need for a more resilient financial ecosystem. Fortunately, the landscape has evolved, with initiatives like SPACs and dedicated growth capital funds offering new avenues for climate-focused startups.

Additionally, corporate entities are stepping up to assume leadership roles in driving climate innovation forward. Company ArcelorMittal invested $36M in January 2023 in Boston Metal which develops electrochemical units to replace blast furnaces in steel manufacturing. Similarly, HeidelbergCement has partnered with Solidia Technologies, a company specializing in sustainable cement and concrete solutions. This shift signifies a deeper understanding of the interconnected nature of environmental challenges and the necessity for comprehensive, cross-sectoral solutions.

Nevertheless, a notable challenge persists: the funding dilemma known as “FOAK” or “First of a Kind” financing. Climate Tech, with its focus on pioneering solutions across various sectors, often grapples with securing funding for projects deemed too novel or risky by traditional investment standards. FOAK projects, while holding immense potential for transformative impact, face reluctance from investors wary of the uncertainties inherent in untested technologies or business models. For more insights, check out our blogpost Solving the FOAK Equation—CAPEX & Climate Tech here.

In summary, the transition from the Cleantech 1.0 bubble to the Climate Tech era marks a pivotal shift in addressing environmental challenges. While Cleantech 1.0 faced setbacks, it played a crucial role in driving down the prices of solar and wind energy, making them more accessible and essential for advancing climate technology. These advancements laid the foundation for Climate Tech 2.0, which expands the approach beyond energy, signaling a promising future of innovation and cooperation. Challenges like funding for novel projects remain, but with continued dedication, Climate Tech offers a pathway to a sustainable future.

The discourse surrounding Climate Tech, an umbrella term encapsulating solutions aimed at mitigating or adapting to climate change, has gained traction in recent years. Yet, defining this concept remains a nuanced endeavor, with various interpretations and frameworks proposed by different entities. Some interpretations of Climate Tech are narrow, focusing solely on renewable energy solutions such as solar, wind, and hydroelectric power. In contrast, others adopt a broader perspective, encompassing a spectrum of innovations across sectors like agriculture, transportation, construction, and waste management.

Defining Climate Tech

Aster Fab refers to Climate Tech as encompassing any product, service or technology designed to address at least one of the six core objectives outlined in the European Union’s (EU) Taxonomy Regulation.

It’s important to note its distinction from cleantech, which predominantly focuses on energy-related elements. For further elucidation, delve into our blog post “From the Cleantech 1.0 Bubble to the Climate Tech Era” for deeper insights here.

The Six Objectives

Figure 1 – The definition of Climate Tech according to Aster Fab

Here are the six pillars outlined by the EU Taxonomy, providing a structured framework for understanding Climate Tech and its criteria.

1. Contribution to climate change mitigation: This pillar focuses on activities that significantly contribute to reducing greenhouse gas emissions or increasing carbon sequestration compared to the baseline for that activity. Climate Tech startup examples include: Ekwateur (Renewable Energy, France), Northvolt (Batteries, Sweden), Heliogen (Concentrated Solar Power), SkyCool (Radiative Cooling, United States)

2. Contribution to climate change adaptation: Here, the emphasis is on activities that enhance resilience to climate change impacts, such as improving infrastructure to withstand extreme weather events or implementing water management strategies to address changing precipitation patterns. Climate Tech startup examples include: Terrafuse (Flood Risk Modeling, United States), Urban Canopée (Heat Island Mitigation, France)

3. Sustainable use and protection of water and marine resources: Activities that promote sustainable water management, including water conservation, pollution reduction, and protection of marine ecosystems, all of which contribute to climate resilience and adaptation. Climate Tech startup examples include Bioceanor (Water Quality Monitoring, France), H2Ok Innovations (Water Optimization, United States)

4. Contribution to the transition to a circular economy: This pillar highlights activities that promote resource efficiency and waste reduction, thereby reducing the environmental footprint and contributing to climate change mitigation efforts. Climate Tech startup examples include AMP Robotics (Waste Sorting, United States), Ecovative (Mycelium Packaging, United States)

5. Pollution prevention and control: Activities falling under this pillar aim to prevent or minimize pollution of air, water, and soil, thereby reducing adverse environmental impacts and supporting climate resilience. Climate Tech startup examples include Blue Ocean Robotics (Ocean Clean Up, Denmark), Carbon Cure (Sequestered CO2 in Concrete, Canada), Graviky Labs (New Ink for Packaging, India).

6. Protection and restoration of biodiversity and ecosystems: This pillar underscores activities that safeguard biodiversity, restore degraded ecosystems, and enhance natural carbon sinks, such as forests and wetlands, thereby contributing to climate mitigation and adaptation. Examples: FlashForest (Wildlife Conservation), NatureMetrics (Biodiversity Monitoring, UK), Spoor (Birdlife Data for Wind Farms, Norway).

In conclusion, we advocate for a thorough framework that assesses the sustainability and climate impact of technological innovations. At Aster Fab, our primary mission revolves around supporting hard-to-abate industries in tapping into the potential of climate technology (see our 9 industries of focus here). So, if you are seeking to engage with Climate Tech startups or exploring ways to decarbonize your operations, feel free to reach out to Léonard Stéger lsteger@aster.com.

123Fab #99

1 topic, 2 key figures, 3 startups to draw inspiration from

People generally link global warming with carbon dioxide (CO2) but, as the Intergovernmental Panel on Climate Change (IPCC) explains, 30% of the increase in global temperature since pre-industrial levels is due to higher methane (CH4) concentrations in the atmosphere. This is because methane is extremely more effective at trapping heat.

Where does methane come from?

The IEA has estimated that 40% of methane comes from natural sources (wetlands, biomass burning…), and the remaining 60% from human activities (agriculture, oil & gas production, waste). The two pathways to methane production are:

• Gas leaks – methane is the main component of natural gas. Thus, it can leak from pipelines and drilling.
• Decomposition of organic matter – when organic matter is in oxygen-free environments, particular microbes called methanogens take the lead in breaking down the organisms. This process, called methanogenesis, leads to the creation of methane.

According to McKinsey, five industries could reduce global annual methane emissions by 20% by 2030 and 46% by 2050. Those are agriculture, oil and gas, coal mining, solid-waste management, and wastewater management.

What about methane capture from the air?

Methane is 200 times less abundant in the atmosphere than CO2 — a scarcity that makes removing it a technical challenge. Capturing methane would require processing a lot of air, which could require an extremely large amount of energy. And unlike CO2, which can be captured both physically and chemically in a variety of solvents and porous solids, methane is completely non-polar and interacts very weakly with most materials. However, researchers claim to have found a promising solution. A class of crystalline materials, called zeolites, capable of soaking up the gas. Regardless of this solution, the difficulty of capturing methane from the air is the reason why most technologies focus on oxidizing the greenhouse gas rather than “hooking” it out.

Startups are developing innovations to curb methane emissions

For the decomposition of organic matter:

• in the gut of ruminants (like cows and cattle) – Australian startup Rumin8 and Swedish startup Volta Greentech are fighting this issue by developing seaweed-based nutritional supplements that inhibit methane production.
• on landfills and wastewater – US startup LoCi Controls bolsters the methane capture process using solar-powered devices.
• on wetlands – UK methane capture startup bluemethane has developed a technology to capture methane from water, enabling to mitigate the methane production from rice cultivation.

For gas leaks:

• oil & gas production – UK startup Kuva Systems uses short-wave infrared cameras to autonomously monitor and alert oil and gas companies about methane leaks. Whereas US startup BioSqueeze has developed a biomineralization technology that seals miniscule leakage pathways in oil and gas wells.
• melting permafrost – the trapped organic matter in the frozen seafloors or shallow seas is emitted when they thaw. US startup Blue Dot Change is investigating whether releasing ion particles into the exhaust steam of ship vessels crossing the ocean can accelerate the destruction of methane.

A methane tax just like carbon taxes

Norway was one of the first countries to introduce a carbon tax in 1991. Aside from carbon, the harmful gases regulated by the tax also include methane. All Oil & Gas operators on the country’s continental shelf are now required to report all methane emissions from their activities. As a result, studies show that the country has succeeded to consistently maintain low methane emissions. Canada is proposing to require companies to inspect their infrastructure monthly, fixing the leaks they find as part of efforts to reduce the sector’s methane emissions by 75% by 2030 (compared with 2012). Although the EU is among 150 signatories to the Global Methane Pledge – an agreement to cut emissions of methane by 30% – EU energy chief warned early March that the EU was lagging in the race to curb methane emissions. Since the proposals on methane in 2021, they have been watered down.

In short, methane will be critical to solving the net-zero equation. The good news is that mature technologies are at hand. From feed additives for cattle to new rice-farming techniques, to advanced approaches for oil and gas leak detection and landgas methane capture. Where costs are prohibitive, there is a need for coordinated action to create the infrastructure and fiscal conditions that would support further action. Finally, across the board, there is a need for more monitoring and implementation.

2 Key Figures

Budget of $60-110 billion annually up to 2030

Full deployment of the methane abatement measures would cost an estimated $150-$220 billion annually by 2040 and $230-$340 billion annually by 2050.

< 100 funded companies

Tracxn

3 startups to draw inspiration from

Kayyros

French-based startup founded in 2016 which is a developer of an energy analytics platform for traders, investors, operators and governments. Kayrros powers part of the Global Methane Tracker.

BioSqueeze

US-based startup founded in 2021 that has developed a biomineralization technology that seals miniscule leakage pathways in oil and gas wells.

Rumin8

Australian-based startup founded in 2021 which is a manufacturer of seaweed-based nutritional supplements for livestock that inhibit methane production. The startup is backed by Bill Gates’ fund Breakthrough Energy Ventures.

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123Fab #98

1 topic, 2 key figures, 3 startups to draw inspiration from

As hard-to-abate industries increasingly foster deep decarbonization strategies, green hydrogen produced from renewables via water electrolysis is expected to be at the very heart of the energy transition. However, at present, water electrolysis accounts for only about 0.03% of global hydrogen production. This is largely due to the high cost of green hydrogen (>$5/kg versus <$1.5 for grey hydrogen) due in part to the high cost of electrolyzer systems. 

In this newsletter, we will examine trends in water electrolyzer innovation that reduce their cost.

Water electrolyzers are electrochemical devices used to split water molecules into hydrogen and oxygen in the presence of an electrical current. Electrolyzers are divided into four main technologies: alkaline, proton exchange membrane (PEM), anion exchange membrane (AEM) and solid oxide. Alkaline and PEM electrolyzers are the most common, produced on a commercial scale (TRL 9). AEMs are catching up in development, at TRL 6, with the development led by German startup Enapter. As for solid oxide, it is still being demonstrated with German startup Sunfire. To learn more about the technical differences, check out the IRENA report here.

Looking at the evolution of patent filings, we can detect trends in the uptake of new technologies to facilitate the implementation of large-scale green hydrogen use. Indeed, the number of water electrolysis-related patent families published worldwide has increased by 18% per year since 2005. In fact, they have surpassed the number of those related to solid, liquid and oil-based hydrogen sources. Five groups of sub-technologies stand out: (i) cell operation conditions and structure, (ii) electrocatalyst material, (iii) separators (diaphragms, membranes), (iv) stackability of electrolyzers (stacks) and (v) photoelectrolysis.

Cell operation

In an effort to improve efficiency, various electrolyzer cell operating parameters, such as higher temperature, higher pressure and zero gap cell unit design, are being explored to make them more cost-effective over a wider range of operating conditions. Danish startup Hymeth (PEM electrolyzer) has developed a high-pressure electrolyzer that operates at higher efficiency than conventional PEM technologies.

Electrocatalyst materials

Scarce materials (yttrium, titanium, iridium, platinum, zirconium) are a major barrier to the cost and scale-up of electrolyzers. Yet, the surge in patents related to non-noble metal electrocatalysts indicates that R&D is moving forward to finding new solutions to mitigate material scarcity. US startups Alchemr (AEM electrolyzers) and H2U Technologies (PEM electrolyzers) have developed electrolyzers that do not require noble metals as catalysts.

Separators (diaphragms, membranes)

Reducing the thickness of membranes increases efficiency, which in turn reduces electricity consumption. Danish startup Hystar has developed an electrolyzer that claims to reduce membrane thickness by up to 90% compared to conventional PEM technologies.

Stackability of electrolyzers (stacks)

Electrodes, bipolar plates and porous transport layers can contribute significantly to the stack cost. Improvements in these components, including scaling up their manufacturing, can lead to lower capital costs.

Photoelectrolysis 

Water photoelectrolysis (water splitting using light as the energy source) is a strong, newly emerging technology. In terms of patent filings, it remains a niche technology, accounting for 6.5% of all water electrolysis patents. Yet, 37% are international patent families, which underscores the importance that applicants place on protecting their inventions outside the domestic market. A prototype of photo-assisted electrolyzer has been developed by ENGIE’s R&D laboratory CRIGEN and US startup Nanoptek.

Europe and Japan account for more than 50% of the total number of international patents in these 5 sub-technology areas. Leading players include Toshiba (JP), CEA (FR), Panasonic (JP), Siemens (DE) and Honda (JP). While Europe leads in the stackability of electrolyzers (stacks) (41% of the total patents in this area), electrocatalyst material (34%) and cell operation conditions and structure (32%), Japan ranks first in photoelectrolysis (39%) and separators (diaphragms, membranes) (36%). Chinese international patents account for only about 4% across the five technology areas but China dominates in terms of the number of pure domestic patent filings.

In short, green hydrogen technology has the potential to decarbonize numerous hard-to-abate industries. The upward trend in patent filings signals that more will soon be filed, addressing the urgent need for new solutions to lower the cost of electrolyzers, while increasing technological efficiency and production capacity. Case to be followed…

2 Key Figures

Market size of $5 billion in 2021

The global electrolyzer market size was estimated at $5.6 billion in 2021 and is expected to reach $69.1 billion by the end of 2030, with a registered CAGR of 32.21% from 2022 to 2030.

85 funded companies

Tracxn

3 startups to draw inspiration from

Lhyfe

French-based startup founded in 2017 which is a developer of green hydrogen plants. The first was inaugurated in 2021, connected to offshore wind turbines.

SunGreenH2

Singapore-based startup founded in 2020 which is a manufacturer of new generation components for electrolyser cells, stacks and systems. Products include PEM electrolyzers, AEM electrolyzers and solar-to-hydrogen panels.

Advanced Ionics

US-based startup founded in 2016 which is a manufacturer of a new class of electrloyzers. Claims to operate at temperatures from 100°C to 650°C, in between those of alkaline, PEM and solid oxide electrolyzers.

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Among the numerous decarbonization solutions under development, three major carbon capture applications stand out today: industrial point source carbon capture, direct air capture (DAC) and bioenergy with carbon capture. Although industrial point source carbon capture appears to be the main focus for most decarbonization roadmaps thanks to increasingly mature and cost-effective technologies driving greater deployment across industrial sites, several challenges must be addressed before it can reach sufficient scale, including policy and regulatory support, access to funding, public acceptance and further cost improvement.

Carbon Capture-as-a-Service (CCaaS) is a business model that is gaining ground in part to circumvent the huge CAPEX hurdles encountered in these type of infrastructure projects. By opting for a one-stop shop solution that handles the entire value chain, hard-to-abate industries can pay to capture their CO2 emissions on a per-ton basis, while other specialized actors take on the risk (and potential financial reward) of managing the full value chain from capture to utilization or storage.

In January, Aster Fab moderated a panel featuring Tim Cowan (VP Corporate Development at Carbon Clean), Silvia Gentilucci (Technology Onshore Planning at SAIPEM) and Michael Evans (CEO of Cambridge Carbon Capture) to discuss the strengths and prospects of the CCaaS business model.

Takeaways from the discussion included:

According to the latest Global Carbon Budget published in November 2022, if emissions are not reduced through decarbonization technologies such as Carbon Capture Utilization and Storage (CCUS), the world will have exhausted its 1.5°C carbon budget – the cumulative amount of CO2 emissions permitted over a period of time to keep within the 1.5°C threshold – in nine years. Indeed, the equation highlighted is quite simple: there are about 380Gt of CO₂-equivalent emissions left in the 1.5°C budget, and right now we use just over 40Gt of it each year.

As such, CCUS is recognized as a necessary piece of the decarbonization jigsaw, but the adoption isn’t moving fast enough. According to a McKinsey analysis, CCUS adoption must increase 120-fold by 2050 for countries to achieve their net-zero reduction goals, reaching at least 4.2 gigatons per annum (GTPA) of CO₂ captured.

In 2021, Decarb Connect conducted a benchmarking survey of industry attitudes towards CCUS that revealed that 65% of executives working in hard-to-abate industries see CCUS as ‘critical’ or ‘important’ for reaching their 2030/2050 goals. It also reveals that 41% are favorable to as CCaaS model, while 59% prefer a mix of funded and owned CCUS. In other words, no executive opted for the traditional model of owning and operating the infrastructure themselves.

Thus, the CCaaS business model appears to be a promising way to accelerate the adoption of carbon capture technology for industrial players:

• No required upfront capital expenditure
• Duty to contract with each player of the value chain is delegated

“At Carbon Clean, we use our leading technology to capture CO₂. and will work with partners to provide the other crucial elements of the value chain: compression, transportation, sequestration or utilization. Our mission is to work with industrial partners to offer an end-to-end handling of our customers’ CO₂.” Tim Cowan, VP Corporate Development at Carbon Clean.

Tax credits, direct subsidies and price support mechanisms are beginning to encourage investment in CCUS. The US, for example, has a 45Q-tax credit that provides a fixed payment per ton of carbon dioxide sequestered or used. The IRA (Inflation Reduction Act) has increased the amount of the credit from $50 to $85 a ton for sequestered industrial or power emission, and from $50 to $180 a ton for emissions captured from the atmosphere and sequestered.  In other words, they provide a direct revenue stream immediately improving the investment case for low-carbon technologies, such as CCUS. What the IRA calls tax credits, the EU calls State Aid. Yet, the panelists affirm that while the EU led the whole decarbonization movement for 30 years, the EU is now behind in terms of policy.

Another element is the uneven distribution of storage sites across Europe. Often illustrated as the ‘chicken and egg’ paradox, there is a need to scale the value chain as a whole, including storage infrastructure. Indeed, a carbon capture plant will not start operating until the captured CO₂ can be transported and then either permanently stored or used.  Similarly, no large-scale carbon storage project will be financed without clear commitments regarding the origin and volume of CO2 to be stored, as it determines the financial viability of the overall project.

Norway’s Longship project, which is sponsored by the Norwegian government, aims to solve this problem by supporting the whole value chain from carbon capture to transportation and storage. Captured emissions will be transported by tankship and stored deep underground using Northern Light’s open-access CO₂ transport and storage infrastructure.

Finally, speakers also emphasized that addressing public concerns around the safety of these technologies will be paramount. Communicating that carbon capture is safe, effective and a needed method of climate change mitigation, can help bring people on-board and ensure that projects overcome development hurdles. “I think honesty in the media about the situation would be a true incentive. If the public understood how urgent the situation is, and understood more about the technology, there would be a lot more action”. Michaels Evans, CEO of Cambridge Carbon Capture

123Fab #97

1 topic, 2 key figures, 3 startups to draw inspiration from

Although 3D printing seems to have been a brief trend for end consumers, the additive manufacturing (AM) market continues to experience significant growth, with a market size valued at $35 bn in 2021 and projected to reach $420 bn by 2030.

The AM industry is led largely by the U.S. market with $8 billion in funding, far head Europe at $1.4 billion or China at $700 million. In fact, AM technologies are slowly getting cheaper, faster and most importantly, bigger. In addition, AM technologies can deliver products with improved environmental footprint by reducing waste within production processes, enabling on-demand customized items, as well as more local production, with lower embedded CO2 footprint.

Historically, the aerospace and defense industries pioneered AM solutions in the 1990s to create complex, low-volume parts and custom tooling quickly and efficiently. The automotive industry followed, taking advantage of the opportunities to explore different layouts, aesthetics and functions to speed up the final product design. The use of 3D printing for prototyping, market testing and custom products then expanded and marked the beginning of the ponctual use for additive manufacturing in industries.

While industries such as food, education and robotics are increasing their use of 3D printing, sectors at the forefront of AM innovations because of the individualized production possibilities are construction and healthcare (California’s Manufacturing Network).

Additive manufacturing is enabling healthcare, and in particular the medical and dental sectors, to create implants, prosthetics, surgical guides, medical equipment, molds, wearables and tools.  No two wounds or bodies are the same and the democratization of customization of prosthetics, wearables and implants on a global scale is an industry-shattering innovation. Major companies such as HP, Siemens and Dassault Systems have already adopted 3D printing technologies to produce medical devices (Medical Device Network).

In the construction sector, large-scale 3D printing is creating building components, structural beams, architectural facades and transforming the industry (AllPlan). Historically, 3D printing production in construction was isolated and separated from a conventional manufacturing process. With larger-scale additive manufacturing technologies, 3D printing can take place directly on construction sites and create an integrated production environment. For example, Vinci Construction acquired French startup XtreeE, founded in 2016, which offers automated construction of various types of architecture and thus creates entire building structures.

Nevertheless, AM is still relatively new and need further performance improvement and cost reduction in order to reach large scale deployment across most industries. Regulatory and safety concerns also currently limit the spread of 3D printing applications.

Looking at the trends in the AM market, a few patterns emerge:

• An acquisition model is emerging: thriving additive manufacturing companies aim to acquire materials and/or software companies to combine expertise.
• 3D printing continues to industrialize, alongside the growing need for post-processing automation and software solutions to enable the large-scale printing desired by many industries for end-to-end AM workflow.
• Continued focus on industrial sustainability. The Additive Manufacturing Green Trade Association (AMGTA) is growing rapidly and now has over 50 members.
• The tremendous importance that data management will play in securing intellectual property within industrial processes.

2 Key Figures

Market size of $14 billion in 2021

The market was valued at $14 bn in 2021 and is projected to reach $78 bn by 2030, at a CAGR of 21%.

863 funded companies

Tracxn

3 startups to draw inspiration from

CyBe

Dutch-based startup founded in 2013 that develops 3D concrete printers and mortar for enabling 3D printing in construction.

Prellis Biologics

US-based startup founded in 2016 that is using 3D bioprinting technology to build human tissues for drug development and develop human organs for transplantation.

Sakuu

US-based startup founded in 2016 which provides AI-enabled desktop 3D battery printers for automotive applications.

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123Fab #96

1 topic, 2 key figures, 3 startups to draw inspiration from

As the market for electric vehicles accelerates rapidly, so does the investment in charging infrastructure needed to support this growing market. While the vast majority of EV charging now takes place at home and at work, widespread, open-access public charging infrastructure will be essential to support EV drivers beyond early adopters.

In the past, proprietary electric vehicle charging technologies competed for market share. But this has changed in recent years, with pressure from regulators and automakers to provide EV drivers with a smoother, more reliable and interoperable charging experience.

Charging station interoperability

The technology behind charging station interoperability is universal roaming. It is analogous to the use of Automated Teller Machines (ATMs), which allow a consumer to access funds from any bank. Similarly, universal roaming allows an EV driver who is a member of a single network to access and pay at any public EV charger. 

This therefore requires billing interoperability for which two business models exist:

• Peer-to-peer: bilateral roaming agreements are signed between two charging network providers to allow customers of one network to use and pay for charging at their competitors’ stations. The standard underlying peer-to-peer roaming is the Open Charge Point Interface (OCPI).
• Hub: a single neutral party acts as an intermediate data clearinghouse and contracts with each individual network service provider. This obviates the need for multiple individual contracts between all providers. The standard underlying hub roaming is ISO 15118.

The second business model, which bypasses the bureaucracy required by bilateral agreements, is the one that is gaining the most ground. Hub players include Hubject (German startup), Gireve (French),  e-clearing.net (German startup), Mobi.E (Portugal startup) and others. Hubject is the leading player with over 1,000 B2B partners in over 52 countries and 4 continents, while the other 3 players are based in Europe.

Hub players are taking interoperability a step further with Plug & Charge. It enables automated authentication and billing processes between the EV and the charging station without the need for RFID cards, credit/debit cards, or charging apps, while ensuring secure transactions.

Vehicle-to-grid interoperability

Interoperability goes beyond billing. Indeed, bidirectional, vehicle-to-grid, or V2G, charging technology will be crucial to EV adoption and avoiding worst-case energy scenarios as EV charging demand surges. General Motors, for example, launched GM Energy in October. It includes GM’s Ultium Home and Ultium Commercial lines. Both will offer products and services that enable bidirectional charging to increase the grid’s reliability. Ford, meanwhile, has marketed the ability of its F-150 Lightning electric pickup to power a home in the event of a blackout. V2G technology has the potential to open up new revenue streams for automakers as they become more intertwined with the power grid.

Physical charging interface interoperability

After seeing a myriad of charging plugs spur, fragmentation has been mitigated. In Europe, Combined Charging System (CCS) is the standard: AC and DC charging sit in one plug. In Japan, the standard is CHAdeMO which will be adopted this year by China. While in the US, it’s Tesla’s Supercharger. But charging goes beyond wiring. Austrian startup Easelink raised €8.3M in January last year and is pioneering new technology. Its conductive charging system, named ‘Matrix Charging’, has the ambition to set up an automated charging network for electric vehicles without the driver ever stepping out or handling the charging cable. It consists of two main components: a vehicle unit attached to the vehicle’s underbody – Matrix Charging Connector – and an infrastructure unit at the parking space – Matrix Charging Pad.

In short, harmonization of technology standards and interoperability between the electric vehicle (EV) and the grid are making inroads. Similarly, widespread public charging access is being bolstered by uberization platforms such as French startup Werenode which enables private owners to provide access to their charging points. Thus, all stakeholders in public EV infrastructure— including EVSPs, electric companies, EV supply equipment OEMs, and automakers—must continue to join forces to streamline system integration and improve customer experience.

2 Key Figures

EV charging projected to reach $420 bn by 2030

The market was valued at $35 bn in 2021 and is projected to reach $420 bn by 2030, at a CAGR of 32%.

537 funded companies

Tracxn

3 startups to draw inspiration from

Hubject

Germany-based startup founded in 2012 that is the leading e-Roaming platform in Europe giving EV drivers a seamless charging experience across borders. Hubject is backed by Enel X.

Easelink

Austria-based startup founded in 2004 that has developed a wireless EV charging system, using its Matrix Charging system. Easelink is backed by EnBW and Wien Energie.

Werenode

France-based startup founded in 2018 that has developed a decentralized marketplace, leveraging blockchain, so that anyone can share their EV charging station. Fiat, XTZ or WRC tokens can be used to pay charging sessions.

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