Change Agent: Redwave Energy Co-Founder Jim Nelson
Founded: 2011 in Chicago
Solution: Turns low temperature waste heat into electricity
RedWave Energy is a small startup with big plans.
It’s the first company in the world which aims to capture low-temperature heat from power plants and transform into electricity, saving billions of dollars in wasted energy. And founder Jim Nelson thinks it’s only a matter of time before utilities realize the value of his company’s solution.
“Worldwide, half of the waste heat is generated by electric generation plants,” Nelson said. “You could take that heat and generate more electricity.
“Nobody (else) is really going after this. When talking to our investors, they said ‘make (the solution) work. Don’t waste too much time on (looking for) business opportunities, that will come.”
Power plans generate tremendous amount of heat when they burn coal or natural gas to make electricity. However, they are unable to use low-temperature heat (less than 250 degrees Celsius which still is pretty hot if you consider water boils at 100 degrees Celsius) and end up wasting that energy.
RedWave’s patented solution uses tiny antennas — millions per square inch — formed and tuned to pick up the wavelengths from the low-temperature heat. The electrons then flow off the antennas and are turned into electricity that can be placed back on the grid.
Nelson said he expects to start beta testing the solution within a year.
He formed RedWave with co-founder and Chief Technology Officer Pat Brady in 2011. Today, it has a virtual team of 20 working on commercializing the solution, including 4 full-time employees, couple contractors and graduate students at universities of Missouri, Colorado and Santa Barbara.
The company’s business plan, put together by Nelson and a graduate student, focuses on a narrow segment of the market – new natural-gas fired power plants. They estimate that sector to offer $700 million in business opportunity each year, especially in Asia and Africa where developing countries are rapidly building power plants to propel their growing economies each year.
“Our business plan is based on zero subsidies,” Nelson said. “It will pay back without that. Our board member tells us not to ‘say clean tech or green tech, say “free energy” – that’s why we invested in you.”
And, unlike most startups, finding investors and raising funds hasn’t been an issue at RedWave – underscoring the commercial promise of its solution.
Since its inception, the company raised $3 million in private funding in February 2012, and that May received a $3.565 million grant from the Department of Energy’s Advanced Research Projects Agency-Energy. The grant was distributed over three years. That government grant award helped improve the company’s standing within the venture capital community.
Another round of funding ($5.5 million) closed in July 2016. Chicago-based venture capital fund Energy Foundry led the round. Private investment firm Northwater Capital, clean tech-focused nonprofit Prime Coalition, and Kuwait-based EnerTech Holding Co. also participated. EnerTech Holding, a subsidiary of National Technology Enterprises Company (NTEC), is owned by Kuwait Investment Authority (KIA) which is very interested in the low temperature waste heat to electricity technology as part of its overall objective to invest in cleaner energy resources.
Nelson said EnerTech found out about RedWave Energy and reached out to him via social media. While getting investors onboard hasn’t been hard, what has been challenging for Nelson is getting utilities onboard to try their solution.
“We don’t have a prototype yet. We want to engage with the utilities; that’s our main segment, we want to test our solution at a power generation plant,” Nelson said. “You need to fit into the ecosystem and work with their equipment.
We do have technical challenges in terms of getting proper efficiencies, and manufacture it at a reasonable cost. Some people say we’re too early to talk to. Some are at the right stage, but how do I get to the right people?”