Pelletco installs wood pellet boilers for commercial customers at no upfront cost | Reuters file photo
Pelletco, a renewable energy startup in Orono, has received an investment of $1.5 million from a venture capital firm in Connecticut, according to CEO James Knight.
The investment comes from CleanFeet Investors and brings Pelletco’s total outside investment to $3 million.
“CleanFeet is one of the pre-eminent clean energy investment funds in the Northeast and this financial partnership will allow us to grow substantially in the near future,” Knight said.
The fresh funds will allow the biomass energy company to build and deploy new units for customers and repay the company’s existing debt with Coastal Enterprises Inc., according to Knight.
“This gives us the opportunity to grow local energy from wood pellets. Heating costs are a substantial problem for many Northeasterners and we have a proven solution that requires no upfront investment while reducing emissions,” he said.
Knight and Michael Bilodeau, director of the Process Development Center at the University of Maine, founded Pelletco in 2010. Its business model is unique in that it deploys its pellet boiler systems, marketed as a HeatPods, to commercial customers at no upfront cost. Once the HeatPod is deployed at a customer’s location, Pelletco operates and maintains the unit. The customer only pays for the heat used. Existing customers include the Loring Development Authority in Limestone, the Center for Cooperative Aquaculture Research in Franklin, and Black River Produce in Springfield, Vermont.
CleanFeet is a venture capital firm in Farmington, Connecticut, that invests in small to medium-sized renewable energy and energy conserving projects.
“Projected cash flows over a number of years, from these proven alternative energy systems, provides our investors with attractive annual returns,” Bernard Zahren, CleanFeet’s managing partner, said in a statement. “Pelletco represents an investment at the core of our investment philosophy of ‘doing well by doing good.’”
The $3 million the company has raised includes a $25,000 grant from the Maine Technology Institute in 2012, which was matched by a $39,000 investment. Coastal Enterprises Inc., the nonprofit financial organization in Wiscasset, last year invested $500,000 in the company as part of its focus on sustainable and renewable energy ventures in Maine. Another of the company’s investors is Eliot Cutler, an independent candidate for governor.
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