Eco2Grow
Power Purchase Agreement (PPA) marketplace for SMEs
The Problem
High and increasing volatility and escalating prices in the energy market present significant challenges to all participants, especially those whose operations are heavily dependent on energy. These conditions often disrupt long-term strategic planning and undermine competitiveness. Small and medium-sized enterprises (SMEs) are particularly vulnerable to these challenges.
Historically, SMEs have relied on traditional methods of procuring electricity and are often disadvantaged by their lack of access to subsidised electricity tariffs or tailored direct B2B power purchase agreements (PPAs). This limitation is due to their insufficient size, the complex contractual terms associated with PPAs and their often perceived lack of creditworthiness. As a result, these companies face an uphill battle to remain competitive and financially viable in a turbulent energy market.
The Solution
ECO2GROW's mission is to enable SMEs to purchase energy directly from solar and wind farms. Their solution not only reduces energy costs for SMEs, but also provides reliable long-term planning, ensures an authentic, fully traceable supply of green energy, and removes legal and transactional barriers. With its model, ECO2GROW will revolutionise the way SMEs procure green energy and open up Power Purchase Agreements (PPAs) to SMEs for the first time.
ECO2GROW will accomplish this mission through a revolutionary fintech B2B SaaS platform. Using an innovative credit risk portfolio approach, the platform aims to democratise access to PPAs by welcoming smaller market players. It is also designed to fully integrate with existing energy contracts, ensuring a seamless transition and ongoing operations for companies.
Why we invested
The renewable energy market is experiencing robust growth and requires market instruments that A) amplify this growth, B) optimise capital efficiency, and C) broaden participation and acceptance. ECO2GROW aims to meet these three key objectives. ECO2GROW innovatively aggregates SMEs into power purchase portfolios, enabling them to directly access electricity from solar and wind farms. In doing so, ECO2GROW delivers significant cost benefits while ensuring long-term planning predictability in terms of volume, price and carbon footprint reduction. This extends the reach of the benefits of renewable energy.
These aspects are critical to a successful energy transition, making renewable energy more accessible, affordable and attractive to a wider market segment - one of the core principles of Vireo's investment thesis.