Earlier this year, Demand Power Group Inc. (DPGI) announced a $71 million equity raise and project finance commitment from Star America.
More recently, Christophe Petit, the Co-Founder, Managing Partner and President of Star America, spoke to Lime Advertising Inc. about what attracted them to Demand Power, what stood out for them, and what benefits Demand Power’s customers will realize following the COVID-19 pandemic.
What Does Star America Specialize In And What Attracted You To Invest In Demand Power?
Star America is an independent U.S. headquartered developer and manager of infrastructure assets in North America. Our investor base includes large institutional investors such as insurance companies and pension funds providing access to hundreds of millions in capital. Our primary focus is delivering infrastructure projects across the transportation, social, environmental, and telecommunications sectors. We currently have investments in projects with a total project cost value of more than $5 billion.
At Star America, we care deeply about the environment and are committed to incorporating environmental, social and governance considerations in our investment and asset management process. This policy drives us to ensure that sustainable design, construction, operations, and maintenance are considered in each investment. Our ESG policy is managed by a dedicated committee that includes senior management, and investment and asset management staff who are passionate about these issues. Because we are investing in physical assets that are essential, long-lived and resource intensive, we firmly believe it is our responsibility to make sustainability and community a focus of our investment process. A tangible demonstration of this is being signatory to the Principles for Responsible Investment. We strive to ensure our projects adhere to the six principles and meet the UN’s Sustainable Development Goals (SDGs).
We are excited to invest in Demand Power’s behind-the-meter energy solution. Our investment will help Demand Power deliver energy storage projects to provide energy savings and energy reliability to its customers. In addition to benefiting Demand Power and its customers, this investment is further enhanced by its environmentally friendly attributes. Specifically, the solution Demand Power deploys reduces energy consumption from the highest emission sources during peak use periods.
Demand Power has a strong management team with deep knowledge and experience in energy management and energy storage.
What Made The Demand Power Solution Stand Out In The Marketplace?
Our investment in Demand Power is a demonstration of our continued commitment to investing in environmentally responsible projects. Beyond the environmental decision, Demand Power’s solution is different versus the standard behind-the-meter solution. It uses On-Line Uninterruptible Power Supply’s (UPSs) with battery connections ensuring that no power switches or outages can occur. Additionally, the solution is designed to prevent disturbances from the power grid on the power networks belonging to Demand Power’s customers. Moreover, the UPS devices cannot harm the utility lines or the safety of utility operators. Demand Power is initially focusing on the single market of Ontario. Together, we’re focused on further developing the robust platform before expanding the service to other locations throughout North America.
Something else that was important to us was the 25+ year experience of Demand Power CEO, Raj Chudgar. Leading a team who are industry experts at energy storage management, Raj has worked in U.S. and Canadian power markets. In his last role, he turned around Viridity Energy over an 18-month period, selling the business to Ormat Technologies Inc. for $35 million. Elsewhere, Demand Power’s COO has been working for 25+ years in the retail electric supply markets including time at Constellation Energy, Just Energy, and One Energy.
If Somebody Asked “Why Should I Do Business With Demand Power?” What Would You Tell Them?
Ultimately, I would tell them that Demand Power’s solution may save you money on your electric bill. Additionally, it may increase your power quality and reliability. I would also tell interested parties that Demand Power’s business is to deliver high quality, seamless power that is better for the environment. The team’s passion about energy and energy storage allows you to focus on your business.
What Benefits Will Demand Power’s Customers Realize From Their Energy Management Solution, Especially Following The COVID-19 Pandemic?
Honestly, it’s similar to the benefits of doing business with Demand Power in the first place. Their value proposition includes reduced power costs, improved power reliability, and improved power quality. Elsewhere, they are a power supplier that can provide additional solutions as required.
What Insight Do You Have On The Current Market Trajectory And How If Will Affect The Energy Industry?
There are a few items I see which should increase demand for energy storage-based solutions. An increase in renewables and a decrease in coal are driving the further push for distributed storage and distributed generation. Solar and wind replacements are a much needed improvement for the environment but do not offer the same consistency in delivery as traditional methods. This is where distributed generation and storage solutions come into play.
Energy demands have consistently been increasing over time and this trend is expected to continue. Combined with the push for renewables, we see upward pressure in the cost of electricity driving an increased demand for behind-the-meter solutions. We believe markets will develop further products to value these customer asset solutions, especially those offering an immediate, or zero lag, interface such as storage or generators.
Tell Us How Demand Power Could Strengthen Its Current Market Position?
As with any business, Demand Power will benefit from increased sales, strong competitive positioning, excellent project delivery and consistent operational results. Following implementation in the Ontario market, the team plans to diversify into other markets and regions. This will push the strong economic and environmental benefits across a broader spectrum. Finally, the Demand Power team can assist multiple industry segments including manufacturing, consumer packaging, healthcare, education and commercial real estate. The value of Demand Power’s solution across multiple segments demonstrates the true strength of the business.
Lime Advertising Inc. exclusively conducted this interview with Christophe Petit of Star America Infrastructure Partners on Friday, June 26, 2020.