Germany-based energy firm Kraftblock announced on Tuesday that it has raised €20M in a Series B funding round.
Shell Ventures, the venture capital arm of energy giant Shell, led the round with the participation of five other global investors, including Finindus and A&G Energy Transition Tech Fund.
“At a time when there are very limited funding opportunities for startups, we are proud to have closed this Series B round,” says Kraftblock CFO and co-founder Susanne König. “It shows the resilience and solid business of Kraftblock and proves our great potential.”
According to Kraftblock CEO and co-founder Martin Schichtel, the team deliberately chose investors that joined its latest fundraising.
“We specifically chose investors who have their roots in industries such as food, steel and energy and who will help us to consolidate our leading market position,” says Schichtel.
With the new investment, Kraftblock plans to expand its human resources and production capacity. It will also help the startup tackle energy-intensive industries, like steel and glass, across Europe and East Asia. Kraftblock also says its new partners create opportunities in the United States and Latin American markets.
Decarbonisation via innovative storage system
Established in 2014, Kraftblock works to resolve the climate crisis through its patented thermal storage technology. Its inventive storage can store temperatures up to 1,300°C. The system can store energy for as long as two weeks.
This system eliminates the need to use fossil fuels in powering plants. It also solves the challenge that other green energy sources pose, which is inconsistency. For instance, a manufacturing facility that relies on solar energy may encounter operational issues on non-sunny days. On the other hand, manufacturing activities consistently generate thermal energy.
Kraftblock’s storage has high thermal conductivity, meaning that it can facilitate heat transfer. Heat is automatically transferred through the medium to the storage material when excess occurs. In times of need, a cold transfer medium will extract heat through the granulate.
The startup claims the storage solution is highly efficient because of its compact size, allowing a storage capacity of up to 1.2 MWh per m³. Furthermore, the operating cost is relatively low, enabling users to achieve the break-even point in a few years.
The construction of the storage system also has minimum impact on the environment with most of its parts being recycled steel slag. The company also claims that the system is durable compared to other energy storage solutions, having an expected service life of over 40 years.
Kraftblock has partnered with several industry leaders to deploy its innovative technology. Last year, the startup announced a partnership with food and beverage company PepsiCo to build an energy storage system in the latter’s factory in Broek op Langedijk, the Netherlands.
What the investors say
Jermaine Saaltink, investment director at Shell Ventures, says Kraftblock had a critical role in the green energy sector.
“As the need for decarbonisation solutions in hard to abate sectors continues to increase, Kraftblock has a pivotal role to play by unlocking a renewable electrification pathway and the increased use of waste heat. Both need credible storage to overcome intermittency. We are excited to be joining the team on their journey as they expand their offering globally,” says Saaltink.
Finindus investment director Hans Maenhout described Kraftblock’s solutions as “game changers.”
“Where industrial processes require more than 60% of their energy in the form of heat, Kraftblock’s solutions will be game changers in ensuring cost effective and net zero heat energy availability,” says Maenhout.
For A&G Energy Transition Tech Fund, the VC branch of Spanish bank A&G, Kraftblock is one of its early investments.
“With this funding round, Kraftblock ensures to have a significant impact in the decarbonisation of the industrial sector,” says Juan Diego Bernal, managing director at the VC fund.
01
From port to startup fort: How Lars Crama is ‘Making it Happen’ in Rotterdam