Axle Energy, a U.K.-based startup, was founded in early 2023 to address the challenges of integrating renewable energy into the power grid. As a B2B company, Axle Energy focuses on developing backend software infrastructure to connect flexible energy assets, such as electric vehicles (EVs), home batteries, and heat pumps, to energy markets. The company’s mission is to decarbonize the grid by promoting the use of zero-carbon energy sources over fossil fuels.
Investment Details
In August 2024, Axle Energy secured a $9 million seed funding round led by Accel, a prominent venture capital firm. This investment is a significant step for Axle Energy as it accelerates its mission to provide software solutions that enable grid decarbonization through flexible energy management.
Business Model
Core Business
Axle Energy operates as an energy flexibility company, developing software that connects distributed energy assets to energy markets. Their platform enables households and businesses to participate in grid balancing by managing the demand and supply of renewable energy.
Products and Services
- Flexibility Incentive Software: This software allows users to connect their EVs, home batteries, and other assets to energy markets.
- Energy Management Tools: Predictive tools to manage and optimize energy usage across various flex markets.
- Monetization Platform: Features that facilitate the scheduling of energy assets and acceptance of payments from markets for energy flexibility.
Target Customers
- Homeowners and Businesses with renewable energy assets (e.g., EVs, batteries, heat pumps).
- Energy Suppliers looking to balance demand and supply with renewable energy sources.
Revenue Streams
- Market Payments: Axle receives payments from grid operators for shifting energy demand through its platform.
- Service Fees: Axle earns fees from partner device makers and energy suppliers who use its software to manage energy flexibility.
Technologies Used
- Machine Learning (ML) Models: For optimizing energy usage and managing the value stack.
- APIs: Seamless integration with existing tech stacks, allowing for quick deployment without additional hardware requirements.
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Karl Bach, CEO and co-founder, emphasizes a transition from a manual, top-down grid management approach to a dynamic, distributed model. By enabling smaller energy assets to participate in grid balancing, Axle Energy aims to replace fossil-fuel-based backup systems with zero-carbon alternatives, making renewable energy more reliable.
Fund Usage
The $9 million seed funding will primarily be used to:
- Enhance Product Development: Further refine and expand Axle’s software solutions.
- Market Expansion: Grow the company’s presence across Europe and beyond.
- Scale Operations: Increase the company’s capacity to manage a larger portfolio of energy assets and markets.
Investors
Accel led the seed round, bringing its extensive expertise in scaling technology startups to support Axle Energy’s growth and innovation in the renewable energy sector.
Market Impact and Potential
Axle Energy estimates that the U.K. grid will need around 40 gigawatts of flexibility by 2030, with the potential for all of this to be sourced from zero-carbon assets. The company’s goal is to achieve a fully decarbonized grid balancing process by that time, eliminating the need for fossil fuels entirely.