Looks like the competition in bundling building energy efficiency technology and financing in a single platform is heating up.
SCIEnergy, a startup with a combo software and energy services approach to building energy efficiency retrofits, has acquired Transcend Equity, a startup with an energy services financing model that takes upfront cost out of the equation for building owners who want energy retrofits. Financial terms of the acquisition were not disclosed.
Tuesday’s announcement also maintains Transcend’s existing arrangement with Japanese trading and investment giant Mitsui & Co., meaning the newly combined companies can expect hefty financial backing for the Managed Energy Services Agreement model that Transcend has developed.
In simple terms, Transcend takes the cost of efficiency retrofits off building owners’ balance sheets by setting up a contract whereby Transcend owns the project, pledges to pay utility bills for the customer, and pays itself and the customer back with the resulting energy savings. Transcend says it’s tested the model with two dozen buildings owned by an unnamed Maryland-based real estate investment trust.
If this sounds a lot like the Serious Capital financing model launched by rival startup Serious Energy, that’s because it is. Serious says that it has a billion dollars in projects in its financing pipeline, with pilot projects for a number of unnamed Fortune 500 institutional owners and universities, according to Claire Broido Johnson, a SunEdison co-founder and former Department of Energy efficiency advisor who joined Serious last year.