Alantra Partners Leads Growth Deal for Energy AI-Software Maker GridBeyond
GridBeyond’s software uses artificial intelligence to help owners of renewable-power assets manage their systems
Alantra Partners led a roughly $55.6 million growth investment in GridBeyond, a developer of artificial intelligence-powered systems that help businesses and grid operators balance electricity supply and demand.
Existing backer Energy Impact Partners, a clean energy-focused investment firm in New York, also participated in the €52.3 million deal that aims to help GridBeyond speed up its expansion in the U.S. as increasing use of intermittent renewable power creates hurdles for grid operators.
Baltimore-based power company Constellation Energy also joined Spanish investment firm Alantra in the deal, GridBeyond said. Other participants included European investors Mirova and Act Venture Capital, as well as electrification and automation companies ABB Group in Switzerland and Yokogawa Electric in Japan.
Dublin-based GridBeyond’s systems help businesses reduce their energy costs by better managing their consumption while taking advantage of the electricity sources they may own, such as storage batteries, rooftop-solar panels and electric-vehicle fleets, said Michael Phelan, GridBeyond’s chief executive and co-founder.
Such assets enable businesses that own them to also act as electricity generators by providing power to the grid during periods of high demand and get paid in return. GridBeyond’s software uses local grid data and weather forecasts to estimate future electricity prices, helping users to make decisions such as whether to discharge their batteries or store energy for later use.
“What’s the best thing to do if the customer has solar on the roof? Maybe they have some EV chargers. Maybe they have an air-conditioning system running that they need to optimize,” Phelan said. “They might also have some spare capacity in their system that they can make available.”
GridBeyond’s system helps clients determine where they can get the best price for their surplus power. The system also helps power companies manage various sources of renewable energy and match them with expected demand so that they can reduce the use of backup fossil fuel-fired plants, Phelan said.
“The artificial-intelligence system is making decisions every 15 minutes or every five minutes as to how best to use the assets you have to basically minimize your cost and make sure that you provide the services that you promised to the grid,” he said.
After decades of relatively stable power consumption in the U.S., electricity demand across the country is expected to surge in coming years as a growing number of data centers go online, according to industry analysts. The increased demand, combined with a rising share of weather-dependent solar and wind power sources feeding the grid, is amplifying the frequency and severity of electricity-price peaks in power markets such as Texas and California, according to a report research provider S&P Global released earlier this month.
Greater difficulty in balancing electricity supply and demand is creating opportunities for GridBeyond in states such as Arizona, Florida and New Mexico, Phelan said. The company also operates in countries such as the U.K., Australia and Japan.
“The grids are under pressure because they’re putting in more renewables and they want less fossil fuel,” Phelan said.
On the other hand, businesses have increased flexibility in how they consume power, he added. As an example, he cited air-conditioning systems that can be automatically adjusted to cool slightly more in morning hours, when solar power is abundant, and turn AC systems off completely during periods of peak demand.
“The problem with renewables is that they’re intermittent, but the good thing about the new demand is it’s also intermittent,” he said. “You can match one with the other and that’s the trick.”