As Standard Gas Technologies completed its latest fundraising round, and embarks on manufacturing and commercialisation of its technology, Brady explains why confidence in SG’s management team was key to Elkstone’s decision to invest.
Most of the pre-investment meetings – between Elkstone’s team, led by Executive Chairman Alan Merriman, and Standard Gas’s Chairman Ed Falkman, CEO David Whitmarsh, and Technical Director Laurence Sharrock – were virtual due to the pandemic.
Experience, commitment and technology are compelling
And as Brady notes, the SG team’s experience, commitment and the company’s technology development were compelling. “Ed has spent the previous 30-plus years in senior level roles in waste management technology, most notably as CEO of Waste Management International, where he took turnover from £100m to £1.5bn. David previously founded and managed two successful property management and development businesses in the UK, and Laurence has a decade of technical experience with the Environmental Scientifics Group, the UK’s leading environmental compliance company.
“Negative emissions, or removals, are a vital part of the global decarbonisation effort, and this market will explode in the decade ahead. We believe that Standard Gas will be a part of the solution,” says Brady.
“The team recognised that mass burn incineration, the industry standard, is too costly relative to the amount of energy it produces. In response, they got involved with and further developed a waste management technology that is far more scalable and flexible than the industry standard and has the added benefit of being carbon negative. They deployed the Standard Gas prototype, the SG50, which demonstrated technological advantages over other pyrolysis systems including the ability to take a greater variety of waste whilst avoiding tar.
“With this new round of funding, Standard Gas is equipped to market an improved version of the prototype, named the SG100, which can operate at 6 tonnes per hour (48k per annum) versus the prototype’s 2.5 tonnes per hour (20k tonnes per annum).”
What got Elkstone excited?
As the drive to combat climate change gains pace, there is increased focus on developing market mechanisms that can help achieve a pathway to net zero, says Brady. “Negative emissions, or removals, are a vital part of the global decarbonisation effort, and this market will explode in the decade ahead. We believe that Standard Gas will be a part of the solution. The Company has a combined waste treatment technology and an IP-protected process which centres on a Next Generation, Heat not Burn solution that is carbon negative and reduces harmful methane emissions and pollution. This is real impact investing: the Standard Gas team is tackling one of the greatest crises known to humanity, the climate crisis”
“On the investment side,” Brady adds, “Standard Gas is poised to make venture-like returns for investors. The technology is rapidly scalable in that it is smaller and more efficient than typical incineration plants; it can append onto an existing plant; and its licensing model allows Standard Gas to target and attract a wide array of end users. The market size is enormous: a recent Goldman Sachs study found that $56 trillion will be spent to get to carbon net zero by 2050 – namely on clean energy and carbon capture.
“Standard Gas’s competitive advantages include its carbon negative process, its ability to process a wide range of feedstock, no tar and no harmful emissions, and a modular design with low CapEx and low operating costs which will appeal to a wide array of end users and can be housed on a broad range of industrial sites. It should be well placed to outcompete.
Elkstone are also excited by the quality of other Standard Gas investors, Brady notes. “Prior to this round, the Company has raised a total of £30m from investors, and new investors in this round include Dean Buntrock, who grew Waste Management Inc. from less than $1 million in annual revenues into the industry-leading company with over $9 billion in annual revenues.”
What’s next for Standards Gas?
“We have an exciting journey ahead with the Standard Gas team,” Brady concludes. “With the SG100, the team is now focusing on proving out the technology at scale, which will likely lead to a host of licensing agreements and ultimately a public listing to exploit its growth opportunities. The Company believes that in the UK, there will be demand for at least 50 SG100 units, and existing joint venture agreements within the German and Welsh markets will assist with wider market penetration. Just an example, Standard Gas is currently in conversation with one of the largest global technology companies, who is firmly interested in deploying SG100s to fuel its data centres and reduce its carbon footprint.”
Learn more about the Standard Gas team hereand Elkstone’s team here.