On 25th-26th September 2024, the BRAVE project, led by the City of Rotterdam, marked its official launch with a two-day kick-off event in the Netherlands. Hosted in Rotterdam's Blue City and CIC venues, the kick-off united key energy and business stakeholders to outline a transnational approach to scaling local energy systems across the North Sea region.
Learn more about BRAVE’s mission to develop a €150m investment pipeline across 7 regional energy ecosystems here.
Day 1: Setting the Stage for BRAVE’s Collaboration
The first day was opened by Lead Partner the City of Rotterdam, extended a warm welcome, emphasising the project's mission to scale local energy initiatives by overcoming prevalent challenges such as the "pilot trap" and scale-up paralysis.
“We very much experience the “scale-up” trap that BRAVE is addressing. Within the project, we want to explore what new roles we can adopt as a local authority to support new markets and partnerships.” - Rory Heltzel-Groenen, City of Rotterdam (BRAVE Lead Partner)
Finance specialists from Rotterdam’s SES Programme and cluster organisation Cleantech Scandinavia gave their perspectives on the challenge of local energy scale-up:
“Creating sustainable economic clusters requires new forms of cooperation between private and public sector organisations. Within the SES Programme we support this by enabling new Finance (grants up to €100k), Networks, and Knowledge creation” - Michiel Goossensen, SES Programme Rotterdam
“At Cleantech Scandinavia we find that funding for implementation is far more evolved than funding for the scaling-up of mature innovations. The clean energy sector needs “fit for purpose” funding, in particular combining debt, grants, equity, and guarantees.” - Magnus Agerström, Cleantech Scandinavia
Dominic Stephen, Energy Consultant from innovation consultancy Bax, set the scene for regional energy financing in Europe. Local energy innovations still currently rely heavily on European and local subsidies.
To achieve true and sustainable scale, we need to move to a mixed finance environment, crowding in private bank loans, equity, subsidy and public guarantees together in a complementary and effective way . BRAVE will explore the combinations of finance instruments that can repeatedly scale energy solutions across Europe.
“There is a clear mismatch between abundant European cleantech funding, and a lack of financing for scaling mature solutions beyond the pilot phase. By focusing on developing the bankability of projects and organisations, BRAVE will help to take one-off pilots from 5 or 10 replications in the region.” - Dominic Stephen, Energy Consultant, Bax
The missions for BRAVE were then set and agreed upon by the consortium:
- Scale - BRAVE aims to empower its partners to scale 1 pilot to 10 followers through regional-level investment models
- Ambition - BRAVE aims to be a means to a larger end, building long-lasting financial instruments, vehicles, and partnerships
- Recognition - BRAVE aims to secure buy in from external senior directors, investors, and European policymakers
- Delivery - BRAVE aims to plant the seeds of realistic and impactful new initiatives
Defining energy system scale-up with Innovation Readiness Levels
BRAVE partners then engaged in breakout sessions to define the project's end goals, using Bax’s Innovation Readiness Levels to set tangible objectives for the end of the three year project period.
Partners first analysed the current state of their readiness to grow investments in regional energy solutions, measuring their readiness in distinct components of Policy, Economy, Society and Technology on a scale of 1-9. They then identified realistic steps they could take within the three year project window, identifying target 'Business Readiness Levels' that will guide their work in BRAVE.
The day concluded with insights from the Interreg North Sea Joint Secretariat, providing guidance on administrative procedures and setting the stage for the subsequent day's activities.
Day 2: Investor Engagement and Strategic Planning
The second day, held at CIC Rotterdam, focused on bridging the gap between innovative energy projects and financial viability.
The first session brought professional investor insights into the conversation, as Rotterdam's InnovationQuarter presented its €100 million venture fund dedicated to advancing companies beyond early-stage readiness. ICOS Capital presented on the importance of scalable business development from project inception.
“We have a €100m venture capital fund which we deploy on behalf of the City of Rotterdam.Through subordinated loans, loan capital, guarantees and shares, we support advances in market readiness by helping mature companies reach commercial viability beyond Readiness Level 6.” - Renaud Struycken, InnovationQuarter
“At ICOS Capital we’ve found that business development should consider the final scale within the initial development process - recognising that the networks and infrastructures needed to develop regional-level solutions are entirely different to those needed for initial pilots.” - Wouter van Rooijen, ICOS Capital
Rolf Bastiaanssen from Bax then emphasised the need for proactive local government support. Underneath the more visible factors of CAPEX and OPEX, there are multiple factors including public sector capacity, ecosystem organisation and a large number of failed projects.
“At Bax we see that ignoring the hidden preparation costs of local energy projects can cause enormous challenges with scaling-up. We hope that BRAVE can lead to template investment models to efficiently replicate local energy solutions at low-cost, supported by “mission-driven” local authorities who take a proactive (and brave) approach to delivering local energy ecosystems.”- Rolf Bastiaanssen, Bax
Joint Problem-Solving for the Energy Transition
A collaborative problem-solving session followed, allowing partners to present their pilot projects and receive constructive feedback from investors and peers. With a focus on bankability, the partners presented their plans to build a regional ecosystem
- City of Rotterdam: Establish a €10m Smart Energy Systems Programme to transition from subsidies to scalable public-private investments in partnership with InnovationQuarter and ICOS Capital.
- C2DE and Pôle MEDEE: Develop replicable investment models for a €130m low-carbon public transport fleet, incorporating electric and biodiesel buses.
- BOM: Build a €30m business case to scale an industrial hydrogen hub in Brabant by identifying market and business conditions for investment.
- City of Malmö: Scale up smart local energy systems with social housing developers, focusing on business models for <€5m urban energy investments.
- Flux50: Create a €2m investment model to install residential heat pumps in low-income households in Antwerp with local energy service companies (ESCOs).
- City of Aarhus: Pilot private loans and public guarantees for a €13m rooftop solar programme covering 70,000m² of municipal solar panels.
Key Takeaways from the BRAVE Kick-Off
- Overcoming the Pilot Trap: Emphasis on transitioning from isolated technical pilots to scalable, financially viable energy solutions.
- Mixed Financing Models: Recognition of the need to blend public and private financing to support large-scale energy investments.
- Strategic Partnerships: Importance of fostering collaborations between municipalities, investors, and technology providers to drive the energy transition.
The BRAVE kick-off meeting set a robust foundation for the consortium's efforts to transform local energy systems, highlighting the critical role of innovative financing and strategic partnerships in achieving sustainable energy goals.
BRAVE partners will reconvene in March 2025 to continue their work on scaling local energy system solutions through new investment models.