Why we invested in found energy

Found Energy is an early-stage technology company based in Boston, Massachusetts, that has developed a unique technology that allows large industrial companies to transition to renewable energy while simultaneously improving circularity in the aluminum value chain. It does so by converting the embedded energy in low-grade aluminum metal into usable renewable energy that can compete with fossil fuels on both price and energy density, accelerating industrial decarbonization.

Found Energy has developed a proprietary, closed-loop process where aluminum undergoes an exothermic reaction to generate hydrogen, steam, and a core aluminum input called aluminum trihydrate (ATH). Found Energy’s novel thermal reactor and catalyst have the potential to disrupt conventional aluminum production by deriving ATH from aluminum scrap, in place of mining new bauxite ore, as well as lowering the energy consumption of the production process through the use of the hydrogen and steam, in place of fossil fuels.

For KOMPAS, this presents an opportunity to invest in the future of industrial decarbonization in an additional class of material that is also core to our mission. Conventional aluminum production accounts for 2% of GHG emissions and demand is forecasted to grow substantially in the coming decades.

Green Aluminum Opportunity

Aluminum is lightweight, flexible, strong, resistant to oxidation, compatible with other chemicals to make bonds, and low-cost making it incredibly attractive for industrial applications. The value and applications of aluminum to major industries will only continue to grow as demand for energy consumption, construction, automobiles and other modes of transportation, infrastructure, packaging, and machinery rises. Aluminum will also play a critical role in the clean energy transition as it is used in the construction of electric vehicles, solar panels, windmills, and heat pumps.

The entire value chain of aluminum production is highly energy-intensive and is a major contributor to greenhouse gases. On top of the sector’s emissions, the mining of bauxite ore requires the stripping of topsoil and produces toxic mine tailings, therefore creating a wide range of ecological problems. Over the last few years, a combination of government incentives, mandates, and corporate decarbonization commitments have been put in place and act as strong tailwinds for the transition to sustainable aluminum production. According to a McKinsey study, it is expected that the demand for green aluminum will nearly triple over the course of the coming decade.

The Green Hydrogen Opportunity

As hydrogen is a primary output of the FRx reactor, Found Energy will look to capitalize on industries’ transition to green hydrogen. Today, a vast majority of hydrogen production is done via fossil fuel or methane-based processes that generate global greenhouse gas emissions and toxic air pollutants. In addition, hydrogen is often produced in one location and consumed in another, which means its use also presents logistical and safety challenges due to its low energy density and inherent flammability.

Found Energy’s Winning Value Proposition to Industrial Decarbonization

• Ability to use low-grade aluminum scrap.
  Found Energy has demonstrated that their catalyst can successfully penetrate aluminum with purity levels as low as 40%, including aluminum that has been contaminated by paint, anodization, roll-from, and extrusion. This unlocks the ability to treat the millions of tons of cheap low-quality scrap that would otherwise reside in landfills.
• No reliance on heat or electricity.
  Unlike traditional hydrogen that is produced via electrolysis, Found Energy’s reaction is based on a chemical exothermic reaction. This means that an exothermic chemical reaction or heat is required to produce clean energy.
• Economic viability.
  Found Energy’s unit economics demonstrate a path to providing an industrial customer with a MWh of electricity at a price point that is competitive with fossil fuel prices in Europe today.
• Providing on-demand hydrogen.
  Unlike traditional hydrogen production which requires extensive investment in storage and transportation infrastructure, Found Energy’s technology allows Hydrogen generation to be generated on demand. It can be integrated into existing plant infrastructure which reduces cost and facilitates faster adoption.

We look forward to working with Peter, Gadi and the talented Found Energy team in their pursuit of disrupting the renewable energy transition in hard-to-abate industries.

— by Talia Rafaeli, Partner at KOMPAS VC, and Summit Rosenberg, Associate at KOMPAS VC

Want to know how found energy went from ‘self-cannibalizing robots’ to cleaning up heavy industry?

Read their latest exclusive for TechCrunch
🔗 https://techcrunch.com/2024/04/17/found-energy-seed-round-exclusive/

Found Energy builds industrial decarbonization solutions that harness the embodied energy of aluminum, one of the most abundant and energy-dense materials on Earth. Building upon innovative technology developed at MIT, Found Energy develops aluminum-thermal power
systems that generate continuous low-carbon industrial heat, hydrogen, and alumina trihydrate (ATH) on-site from a variety of aluminum feedstocks. Their ecosystem of flexible, modular, and safe power systems allows heavy industrial customers to meet zero-carbon energy targets while reducing energy costs and waste.

For more information, please visit www.found.energy