Our offering

Capital +
Culture +
Capabilities

Modern Energy offers a home to early-stage asset development platforms like no other in our industry. Our combination of agile capital, distinctive culture, and differentiated capabilities enables our platforms to scale quickly and efficiently.

Learn about our approach in the video.

Our Process

We have a proven model to drive energy transition businesses towards scale:



Discover

Establish the business model

  • Start with an identified market opportunity
  • Look for a business model with differentiated unit economics where we think the model can achieve scale
  • Provide startup capital to confirm model

Launch

Demonstrate the model
can scale

  • Prove that we can scale from initial pilot projects to multiple customers
  • Season an initial portfolio of projects large enough to attract institutional capital
  • Build internal operations capable of delivering these types of projects at scale

Scale

Drive returns to equity

  • Bring in institutional funding to lower the cost of capital
  • Utilize lower cost of capital and strong operations to lead the market at scale

Optimize

Diversify the business

  • Pursue business diversification via adjacencies
  • Lower cost of capital
  • Continue to expand the core business line

Platform Criteria

We look for opportunities to partner with emerging developers building energy transition assets. These include, but are not limited to:
 

Utility-Scale Solar, Distributed Solar

EV Infrastructure

Green Hydrogen 

Standalone Storage

Geothermal

Carbon Capture & Storage

Hydro

Energy Efficiency 

We focus on clean energy developers and opportunities that satisfy four investment criteria:

1.
A proven clean energy technology with strong fundamental economics
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We look for sound economic fundamentals, and, ideally, anticipated declining technology costs that improve the unit economics year-to year. Examples include the declining costs of solar panels; LEDs; and technology to drive down transaction, billing, and operational costs over time.
2.
Favorable regulatory environment
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We track regulatory signals that are poised to create new markets or “greenfield” spaces in an otherwise crowded landscape. We find these by actively participating in energy market and policy discussions and seek out and listen to businesses with new ideas. Examples of these include the original PURPA implementation in North Carolina and Brazil’s 2016 Virtual Net Metering rules.
3.
High complexity inhibiting direct customer adoption
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We look for factors that are difficult for others to replicate due to complexity and interdisciplinary innovation. Examples include contracts requiring multiple counterparties, specialized knowledge of each energy market and regulations not typically possessed by other players, and integration among disciplines that don’t normally work together. We seek audacious business models backed by teams with specialized expertise who work in ways that other entrants can’t and incumbents won’t.
4.
Relatively high upfront capital requirement
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Energy transition businesses often require significant capital and long horizons. This can be a barrier to entry for many businesses and their investors. Modern Energy provides phased-in capital that matches the needs of each business and that changes as the business grows. We look for entrepreneurs who are savvy enough to understand what they need in each phase and disciplined to match capital to their needs.

Case study

Learn more about our process with a Faro Energy case study

 

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