Big Money! Cool Planet lands $100M in Series D investment round

| March 31, 2014

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Largest Series D ever by a biofuels company – why are some biofuels companies raising so much of late?

Has Cool Planet leapt into the Big Three of the Biobased Revolution?

In Colorado, Cool Planet announced that it has closed on its targeted $100 million Series D financing.

It joins an elite group at the forefront of the biobased revolution including Solazyme, Amyris, POET and LanzaTech who have raised these kinds of amounts.

And it caps an unparalleled run of success in the industry, with LanzaTech, Solazyme and Cool Planet announcing cap raises totaling $320 million in the past two weeks.

North Bridge Venture Partners and Concord Energy were the lead investors for the round. The round added investors from Hong Kong, Singapore, the United Arab Emirates (UAE), and Mexico to a marquee existing investor base, including North Bridge Venture Partners, Shea Ventures, BP, Google Ventures, Energy Technology Ventures (GE, ConocoPhillips, NRG Energy), and the Constellation division of Exelon.

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The news is a follow-up to the announcement last September that the company had raised $19.4M in the second close of a “D round” equity raise, after closing on more than $29.9M in June of 2013, bringing the total raised to more than $60 Million, including the remaining commitments from existing investors.

Er. what does Cool Planet make again?

A renewable gasoline blendstock and a soil amendment similar to Terra Prete.

Why’s the company so hot?

It’s a variation on low, lower and lowest.

Low scale-up risk and infrastructure requirements for the fuel, lower operating cost per gallon of fuel, and lowest (which is to say, negative) carbon emissions.

Initial commercial projects: headed for Louisiana

Cool Planet will use a portion of the equity raise to finalize engineering design for the company’s first commercial facility. The funding will also provide capital to construct Cool Planet’s first commercial plant, which will be located at the Port of Alexandria, Louisiana. The company expects the facility to be in operation before the end of 2014.

Last year, Cool Planet Energy Systems CEO Howard Janzen said that the company will build three bio-refineries in Louisiana with a capital investment of $168 million. The project will consist of modular biomass-to-gasoline refineries in the Port of Alexandria, Natchitoches and a site to be determined. Cool Planet will create 72 new direct jobs, averaging $59,600 per year, plus benefits. Additionally, LED estimates the project will result in 422 new indirect jobs, for a total of 494 new jobs. The company estimates 750 construction jobs will also be created by the project.

Cool Planet will utilize wood waste and forest byproducts to make gasoline at its initial commercial-scale facilities in Louisiana. Each bio-refinery will be capable of producing 10 million gallons of high-octane, low-vapor pressure gasoline for strategic distribution through existing market channels and for blending at Louisiana refineries.

In December, Cool Planet broke ground on the company’s first commercial facility in Alexandria, Louisiana, dubbed Project Genesis. The facility is designed to produce 10 million gallons per year of high-octane, renewable gasoline blendstocks, as well as biochar, all made from sustainable wood residues.

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The facility will be located at the Port of Alexandria, on the Red River Waterway in Central Louisiana. The site was chosen because of its excellent wood biomass availability, interstate and rail access, and direct barge access to more than nine refineries. The facility is expected to produce at least 24 direct jobs and bring at least $56 million in economic investment into the state. Estimates are that an additional 150 indirect jobs will result because of this facility, and 350 construction jobs will be utilized.

Timeline to scale

This first commercial plant at the Port of Alexandria will begin operations in late 2014. Construction will begin on the second bio-refinery at the Port of Natchitoches by the summer of 2015, with a completion date in the summer of 2016. The third site is scheduled to come online in late 2016 at a Louisiana site to be determined.

Reaction from the stakeholders

“We are very pleased with the strong interest and support from investors that enabled us to reach our $100 million funding objective,” said Howard Janzen, CEO of Cool Planet. “A significant number of new international investors with both a financial and strategic interest came into the financing.  We are seeing strong interest in deploying our technology in markets such as China, Southeast Asia and the Middle East.”

“We’re particularly pleased with the broadening base of investors coming into this round of financing,” said Barry Rowan, CFO of Cool Planet. “More than half of our new equity investors are international, joining our earlier investors who all participated in this round.”

“As one of the original investors in Cool Planet, we have continued to invest in each round of funding as we have seen the technology advance to commercial readiness,” said Carmichael Roberts, Partner at North Bridge Venture Partners and Cool Planet board member. “The company has an exceptionally strong and experienced management team, and is poised to deliver real and meaningful new solutions to the energy, food and water industries.”

“We’re delighted that the D round financing was so successful,” said John Stuart, CEO Asset Group at Concord Energy Pte Ltd in Singapore. “This funding will accelerate the company’s entry into Asia and the global market. We’re excited to help bring Cool Planet’s advanced products to the international arena and believe the company has the potential to change the calculus in energy, agriculture and water management.”

Progress with Cool Terra – the soil amendment

Cool Planet Energy Systems, a developer of solutions for the energy, food and water industries with drop-in fuels and advanced CoolTerra biochar products, announced last week an MOU with Organic Waste Solutions, which designs and constructs low impact solutions to address water pollution from storm water runoff, and for water treatment and environmental remediation.

Cool Planet and OWS will cooperate in developing proprietary biochar-enabled technologies to address the need for secondary wastewater treatment, water remediation, and the management of storm water runoff. The companies will work to set up and operate laboratory and field demonstrations, optimize and document the benefits of Cool Planet’s proprietary biochar product in ecological bioremediation, and provide designs for optimal delivery systems. The parties will jointly evaluate the results of the experimental program at the completion of the studies and enter into definitive agreements to commercialize the technology subject to success.

According to Rick Wilson, who leads Cool Planet’s biochar business, “The OWS team is well known in low-impact water remediation. They have designed and deployed water remediation solutions across the United States and around the globe, including projects in China. In commercial deployment, Cool Planet’s technology solutions will span water pollution, low-carbon liquid fuels, increased food capacity, and address drought and climate change in a very practical manner.”

More on Cool Terra here.

Expansion to Asia-Pac

In October 2013, Cool Planet Energy Systems and Acritaz Greentech announced that they signed an agreement to explore the building of multiple commercial facilities in Malaysia.

The plan is to begin construction on the first plant in 2014.   Acritaz will work with Cool Planet to use biomass raw materials local to the region that include palm plantation waste products such as empty fruit bunches, wood, and bark waste to make renewable, cellulosic fuels for the Asian market.

“We are pleased to be working with Acritaz Greentech, a group that is known for their technology leadership in biomass processing and bio-technology in Malaysia, to deploy our biofuels and biochar technology” said Cool Planet CEO Howard Janzen, “This is another validation of our technology, as we begin to build partnerships that will commercially deploy our bio refineries outside the U.S.”

Acritaz will work to commit USD60 million to the first facility before the end of 2013.  The first commercial facility is planned to be located in the Malaysian state of Johor.  Acritaz and Cool Planet will then work to build multiple facilities across Malaysia, with Acritaz purchasing proprietary equipment and consumables from Cool Planet in the construction and operation of the facilities.

In September, Concord Energy announced that it signed an agreement with Cool Planet Energy Systems to establish a joint-venture in the Asia Pacific Region. The JV will develop commercial production facilities for the conversion of non-food biomass into biofuels and soil enhancing biochar. Concord Energy has also made a financial investment in the Cool Planet, joining other global investors such as BP, Google Ventures, Energy Technology Ventures (GE, ConocoPhillips, NRG Energy), and the Constellation division of Exelon.

The Bottom Line

Watch this company. The key, in so many ways, is in Cool Terra — a product that has to deliver a substantial market if Cool Planet is to reach its cost and emissions goals.



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