Power Players: Experts Discuss the Future of Energy at Pepper's Annual Mid-Atlantic Energy Technology Forum
What are the biggest trends in energy investment? What are the greatest challenges to innovation? Which company is the next big thing in energy? These are all difficult questions, but attendees of the recently held 7th Annual Mid-Atlantic Energy Technology Forum got an insider’s look at the answers, as well as an introduction to some of the industry’s most exciting up-and-coming companies.
Pepper’s Energy and Emerging Company Groups, in partnership with the Cleantech Alliance Mid-Atlantic, hosted the April 8 event at the Academy of Natural Sciences of Drexel University in Philadelphia. The nearly 200 attendees represented the energy, finance and investment industries, and included executives, lawyers, consultants and entrepreneurs among other professionals.
The event began with opening remarks from partner Thomas P. Dwyer, co-chair of the Energy Industry Group and a member of the steering committee of the Emerging Business Group. Mr. Dwyer spoke about the robust climate of investment in the energy industry and how companies that presented at last year’s forum took advantage of some of the exciting opportunities available. These included Preferred Technology, LLC, which recently completed a large equity and debt financing; Essess, which finished an $11 million Series B round; and Solar Grid Storage LLC, which was acquired by SunEdison in March 2015.
Mr. Dwyer then introduced the Energy Technology Investment Panel, which featured Snehal Desai, global business director, Dow Water & Process Solutions; Sam Gabbita, managing director, Element Partners; Joseph Slamm, partner, Hudson Clean Energy; and Cory Steffek, managing director, Saudi Aramco Energy Ventures. Mr. Dwyer began by asking the panelists what kind of energy investments they were looking for and why.
Desai noted that his role at Dow Water meant he was mostly looking at water tech companies. He said Dow looked for “strategic investments in start-ups,” including those working on issues such as advanced separation, purification, and wastewater reuse. Gabbita agreed that water was a major focus of energy investors, and that Element Partners dedicated about one-third of their resources to investment in water. The other two-thirds of their investing was spread across traditional energy and power and advanced materials and transportation.
Slamm spoke about his prior work at Goldman Sachs and how his company, Hudson Clean Energy, has established itself as “a global clean energy expert.” He noted one emerging trend for his company was solar infrastructure and that Hudson’s effort in that field is “growing.” Steffek identified a variety of fields that Saudi Aramco is focusing on, including upstream oil and gas, downstream oil and gas, and renewables. He said that Saudi Aramco’s “goal is to drive product adoption” and that the company has completed seven deals in its three years in the North American market.
Mr. Dwyer followed up the conversation by asking the panelists what market and economic fundamentals drove the investments they described. Desai said that “population and industrialization have driven our business.” In addition to the “longstanding drive to lower energy costs in water treatment,” he noted that Dow’s work was heavily influenced by the population’s “more aggressive adoption of trends.” On the flip side, he discussed the water industry’s overall slow pace in adopting new technology, which Desai identified as “the challenge of the industry.” Gabbita said his firm is looking for companies that offer “a fundamental ROI,” but that there has to be “a tech angle” in everything they consider. He noted that the most exciting projects innovate in a large existing market.
Slamm took a pragmatic approach, stating that “whatever our investors tell us they want is what’s fundamental.” He elaborated by saying that most investors are concerned with yields right now — as “yields are negative across the globe” — which has led to greater investment in infrastructure. Steffek identified key issues for the next five years, including the cheapness of natural gas, the location of stranded gas and the price of crude oil. He explained that Saudi Aramco looks at all of these trends in “evaluating commodity risk.”
Mr. Dwyer next asked the panel about the future of M&A and investment in the energy tech industry. All panelists noted that the current investment climate poses both opportunities and challenges. Gabbita said IPOs in energy have decreased after 2014’s “banner year,” but that he remains optimistic, particularly for tech-enabled companies. Steffek echoed the statement, saying that companies that have proven their technology in the market will continue to do well.
Mr. Dwyer concluded the panel discussion by asking if any of the panelists thought a groundbreaking company, like Apple or Google, would emerge in the energy industry. Although most of the panel was skeptical — noting that long innovation and adoption cycles in energy pose challenges to seismic shifts in the industry —Gabbita thought it was not only possible but, in fact, had already happened. He identified SolarCity and Tesla as two consumer-facing companies that have both innovated and executed well. He went further, saying “big data and the Internet of Things will create huge new opportunities in the future. Hopefully, the best is yet to come.”
After the panel discussion, Kevin Brown, co-founder and chairman of the Cleantech Alliance Mid-Atlantic, introduced the Energy Technology Company Showcase. The ever-popular showcase afforded cutting-edge energy companies the chance to present their innovative ideas and visions for the future. The companies featured this year included the following:
- echoMESH, LLC, a Berwyn-based company, offers an innovative system for monitoring energy waste. The echoMESH system measures energy usage, analyzes the data in real time and sends recommendations to building operators and occupants. By using ecoMESH, building owners and operators can decrease energy inefficiency and cut costs.
- Go Green Global Technologies Corp. provides solutions for both nonchemical water treatment and fuel combustion applications. Headquartered in Connecticut, Go Green has a portfolio of intellectual property that includes its patented Sonical™ technology, a cost-efficient and easily installable device that makes existing fuel and water systems run cleaner and more efficiently.
- NavPort, LLC, located in Plymouth Meeting, Pennsylvania, assists companies in the oil and gas industry to make better decisions and become more successful by using analytics and industry-leading data. Offering detailed and unique data about North American unconventional well activity, NavPort’s Web-based analytics interface allows users to perform their own analysis and build their own models or to utilize NavPort’s experts to address their research needs.
- PetroMar Technologies, Inc., headquartered in Exton, Pennsylvania, provides products and services related to downhole oil and gas exploration and other energy technology. PetroMar’s proprietary products include an advanced borehole imager and a high-temperature data storage system.
- SoloPower Systems Inc. delivers innovative, high-quality solar energy products for integration into a myriad of applications. Based in Portland, SoloPower produces efficient, lightweight solar panels that address issues present in existing solar technology, such as weight and durability.
The event concluded with a cocktail reception, where attendees could network, meet representatives from the presenting companies and check out exhibitions from other up-and-comers in the energy industry.
Content contributed by attorneys of Troutman Sanders LLP and Pepper Hamilton LLP prior to April 1, 2020, is included here, together with content contributed by attorneys of Troutman Pepper (the combined entity) after the merger date.