France-based Granular Energy bag €7.5M to address lack of transparency in clean energy industry

Paris-based Granular Energy, an energy startup, announced that it has raised €7.5M in a funding round led by Norrsken VC. 

Apart from Norrsken VC, the round also saw participation from All Iron Ventures, Box Group, Valo Ventures, and existing investors Seedcamp, Revent, and Powerhouse Ventures.

The company says it will use the fund to improve transparency in green energy procurement and direct consumer spending towards clean energy technologies for the most demanding needs.

Granular Energy set these goals considering how consumers globally spent €22.8B on green electricity in 2022 without knowing the origins of the electricity itself and its related carbon emission. 

In addition, certificates to verify clean energy purchases continue to be in demand, considering their value. Yet, the current certification system is deemed insufficient to support the delivery of clean energy to people in need.

Current state of certification for clean energy purchases

In the current state, energy companies are allowed to market tariffs as ‘green’ if they can prove that they have sourced enough energy certificates to cover the energy consumed by their consumers from businesses to households on a tariff within 12 months.

It allows companies to buy certificates for renewable solar energy from a solar farm in midsummer and claim that they will use the energy for households during winter.

Furthermore, energy companies are not allowed to disclose the origins of the clean energy certificates and how they distribute them to their customers.

A survey by Granular Energy reveals that less than 5 per cent of global leading utilities fully disclosed the renewable energy sources behind their green offers last year. 

“How green is your green energy? The answer is surprisingly murky. Many consumers are on contracts branded as ‘100 per cent renewable,’ yet there are serious questions about what this really means,” says Toby Ferenczi, co-founder of Granular Energy.

Changing the status quo

Alarmed with the status quo, Granular Energy seeks to provide utilities with a new software category that automates the management and allocation of clean energy certificates. The software will also improve transparency of the origins of clean energy, including information on the associated carbon emissions.

Currently, there is still no legislation on disclosure about clean energy-related matters. But, the appetite for more transparency is high as 25 utilities from nine countries worldwide have been relying on Granular Energy’s software.

Granular Energy can help customers have a more realistic view of their electricity supply by sourcing the electricity on an hour-by-hour basis.

Agate Freimane, General Partner at Norrsken VC, says, “We’re excited to support the Granular team on their journey to revolutionise the power grid. Granular Energy’s software empowers utility companies to offer honest insights to customers about their energy sources, at a time when there’s increasing demand for transparency.”

“We believe in the team’s vision to drive substantial change and make greener energy not only more readily accessible and understood but the norm,” adds Fremaine.