Renewable energy software company Evergen is one step closer to achieving its ambitious goal of destroying 10 coal-fired power stations in 10 continents in the next three years, having raised $6 million to accelerate its growth.
The business, founded in 2015 in a joint initiative by CSIRO and AMP Capital, has developed an intelligent energy management system, which helps households get more from their solar panels and batteries by monitoring price and weather signals. It uses this data to take the pressure off the grid by storing electricity when it’s cheap and bountiful, or selling excess solar power when there is high demand.
Speaking to The Australian Financial Review, Mr Hutt said a third of Evergen’s 1000 customers ended up making a profit from their solar power each year, while the rest saved about 80 per cent on their electricity bills.
“Australia is at the leading edge of the evolution to sustainable energy systems. We have the highest penetration of rooftop solar on the planet and the world is watching us to see how we tackle the decarbonisation problem,” he said.
“We’ve proven our model works at scale and we should have 10,000 batteries under our control by Christmas. We also have a partner in South Africa already working with us to do what we’re doing here… We want to be a global player in this energy transition.”
Currently, there are around 2 million homes with solar panels in Australia, but only 50,000 homes have batteries, according to Mr Hutt.
The growth of batteries has not kept pace with the growth of solar panels thanks largely to their cost, but Mr Hutt was confident they would grow in popularity thanks in part to technologies like Evergen’s, which help owners recoup their upfront cost within five years.
Passion for planet
With Evergen’s goal of being connected to 10,000 of the at-home batteries in Australia by the end of 2020, this would give the company between 10-25 per cent of the market, factoring in its projected growth rate.
But to achieve its vision of “destroying” a coal-fired power station by removing the need for it from the grid, it will need to control 50,000 batteries locally – a feat Mr Hutt believes it can achieve by late 2021.
“As a father of three girls, I’m pretty passionate about keeping the planet from catching fire,” he said.
“Climate change isn’t going away and it’s a problem for our generation to solve.”
The capital raising was led by Artesian and AMP Capital, while $500,000 of it was raised through crowd-sourced equity funding platform VentureCrowd.
The company would have banked $7 million, but it lost $1 million at the eleventh hour thanks to the COVID-19 pandemic affecting investor appetite.
The business started out selling batteries, as well as software, but last year switched its model to focus on its software-as-a-service business. It struck deals with Solar Service Group (the country’s largest distributor of home batteries) to be the “virtual power plant operator” of its fleet of 10,000 batteries and 8 Star Energy (which sells batteries into 56 countries) to be its default energy management software provider.
By 2024 Evergen expects to generate $20 million in recurring revenue from its energy optimisation software.
Before taking on the top job at Evergen, Mr Hutt had been the entrepreneur-in-residence at corporate accelerator Slingshot and chief executive of HR start-up The Search Party.
The Search Party raised about $25 million in capital and completed a backdoor listing in 2016, but Mr Hutt resigned in early 2017 and in October that year the company de-listed, with the directors buying back the shares.
Mr Hutt said he learnt a lot from the experience, but the business listed too early and was not suited to life as a public company.
“Being public and communicating to retail investors rather than venture investors, I found very taxing. I should have known it wasn’t the right type of business to list,” he said.
“Marketplace businesses have to get really big before they’re profitable… It was still in pretty good shape when I left it, with cash in the bank, but it taught me that focus is everything.
“We were trying to do too many things at once. We had teams in the UK, Australia and Canada and we probably should have just focused on the UK because it was our best market by far and we were left too thin.”
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