Under a new agreement, GEM Global Yield LLC SCS, a private investment group, is committing to provide Hydro Wind Energy with a share subscription facility of EUR 50 million for a 36-month term following the public listing of the company shares on a European or American stock exchange.
Hydro Wind Energy will control the timing and maximum amount of drawdown under the facility and has no minimum drawdown obligation. Concurrent to the public listing of Hydro Wind Energy’s shares, GEM will receive warrants to purchase shares in the company.
Hydro Wind Energy, based out of London, San Francisco and Dubai, is a tech startup developing a disruptive technology focused on low-cost clean electricity, grid-scale energy storage and water scarcity. All three solutions harness offshore wind using vertical axis wind rotors and offshore-based kite systems. They are also developing and commercializing a low-cost handheld seawater desalination device for humanitarian purposes and the marine sector. Hydro Wind Energy is backed by Techstars, a VC and tech accelerator.
The finance raised from GEM will go towards developing technologies for power generation (OceanHydro Wind) and water desalination (SubSea RO Wind), as well as scaling QuenchSea (portable seawater desalination device) globally.
Both OceanHydro Wind and SubSea RO Wind are powered by high-altitude, ocean-based kites and vertical axis wind rotors rather than turbines. The technology ultimately uses wind for mechanical lift rather than converting directly to electricity. This reduces the cost of desalination by 90% compared to all other technologies. It also enables a far more efficient method of power generation, storage and dispatch, compared to conventional wind turbines which are unable to either store or dispatch on-demand electricity. The technology also opens up access to offshore wind in deep waters where 80% of the world’s wind resource exists and provides ancillary services for grid resiliency.
“Having GEM onboard is a huge foundational step in realizing our vision to play a major role in the global transition,” says Lee King, CEO and co-founder of Hydro Wind Energy. “Our technology is ultimately about structural design, systems integration and automation rather than making quantum leaps in technology development. It’s in essence a simple technology with immense potential for impact in the shortest possible time.”
The company is currently in the midst of a project building and testing a subscale system of both technologies off the coast of Fujairah in the United Arab Emirates with several offshore engineering firms and strategic partners. A project that will build the foundations for building a larger scale demonstrator. The company plans to have both scale prototypes completed by the end of 2022, with full scale commercialization planned for 2023. Annual revenues are forecast to reach at least $300 million by 2025.
“What we are doing is combining existing and proven technologies in a novel way to solve some very big challenges while simultaneously reducing costs,” adds King. “The financial commitment from GEM and the parallel public listing will provide us with the ability to accelerate scale testing and commercialization.”