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Bluesource and Element Markets to merge

Bluesource, a carbon credit developer and Element Markets, a renewable natural gas marketing and environmental commodities companies, have agreed to merge.

Bluesource, a carbon credit developer and Element Markets, a renewable natural gas marketing and environmental commodities companies, have agreed to merge. TPG Rise will have majority ownership of this combined entity. No financial terms were disclosed. NGP ETP, the energy transition investment platform of NGP Energy Capital Management, joined TPG Rise in the transaction.

PRESS RELEASE

SAN FRANCISCO & HOUSTON & SALT LAKE CITY–(BUSINESS WIRE)–Bluesource, LLC (“Bluesource”), the largest carbon credit developer in North America, and Element Markets, LLC (“Element Markets”), a leading renewable natural gas marketing and environmental commodities company, today announced that they are merging to form a combined entity under majority ownership by TPG Rise, a global impact investing platform managed by alternative asset firm TPG. TPG Rise’s investment comes through a significant new commitment from TPG Rise Climate and additional investment from The Rise Fund following its acquisition of Element Markets in January 2021. NGP ETP, the energy transition investment platform of NGP Energy Capital Management, joined TPG Rise in the transaction.

Together, Element Markets and Bluesource will create the largest marketer and originator of carbon and environmental credits in North America and one of the largest in the world. The combination brings together Element Markets’ leading position in low carbon fuels and greenhouse gas markets with Bluesource’s expertise in nature-based solutions, project development, capital formation, and advisory services to create a vertically integrated climate-focused company that serves all sectors and geographies to accelerate the fight against climate change and environmental degradation.

“Uniting Bluesource and Element Markets represents the realization of our shared vision to achieve a decarbonized future through quality, trust, and accountability in our environmental products and services,” said Angela Schwarz, CEO of the newly combined entity. “Environmental action cannot wait, and as a combined firm we are positioned as the global leader in driving integrated climate solutions for public and private organizations around the world.”

“Both our companies were started with the intent of making a difference in the world and responding to the challenges of climate change with integrity and authenticity,” stated Bill Townsend, Head of Strategy and Business Development of the new combined entity. “Each of our companies has led in the evolution of the market, managing climate risk through the development of innovative solutions. Bluesource’s success has grown in step with that of Element Markets’ and we look forward to what we will accomplish together for our planet.”

The necessity and demand for readily available solutions to address climate change is accelerating at an unprecedented pace as the number of companies making net zero pledges continues to grow. Market-based solutions offer opportunities for organizations looking to make investments in conservation and emission reduction projects where certain operations generate unavoidable emissions. As trusted solution providers, Bluesource and Element Markets facilitate access to low and zero carbon resources, supporting companies seeking to minimize climate impact while maximizing their value in the environmental marketplace.

“Delivering quantifiable greenhouse gas emissions reductions is core to the TPG Rise mission. Our conviction around the carbon credit market has only grown stronger since our initial investment in Element Markets and adding Bluesource allows us to continue to meet the increasing demands of the marketplace,” said Mike Stone, Chief Investment Officer of TPG Rise. “Combining Element Markets and Bluesource will allow us to channel much needed capital and solutions to deliver a robust supply of third-party-verified credits via nature-based sequestration, avoided nature loss, methane destruction, low carbon fuels, and new and innovative pathways,” added Marc Mezvinsky, Business Unit Partner in TPG Rise.

The full integration of the two companies, including the launch under a new name and brand, is expected to be completed in 2022. The combined company will retain all current office locations, including Houston, Salt Lake City, Los Angeles, San Francisco, Carlsbad, CA, Washington, D.C., Toronto, Calgary, and Budapest.

Philip Deutch, NGP ETP Partner, will join the combined company’s board of directors. GEF Capital, who became a shareholder of Bluesource in 2018, will remain a shareholder in the combined entity.

Kirkland & Ellis is serving as legal advisor to TPG Rise and Element Markets in relation to the transaction. Parr Brown Gee & Loveless is serving as Bluesource’s legal counsel. Additional terms were not disclosed.

About TPG Rise Climate
TPG Rise Climate is the dedicated climate investing strategy of TPG’s global impact investing platform TPG Rise. TPG Rise Climate pursues climate-related investments that benefit from the diverse skills of TPG’s investing professionals, the strategic relationships developed across TPG’s existing portfolio of climate-focused companies, and a global network of executives and advisors. The fund takes a broad-based sector approach to investment types, from growth equity to value-added infrastructure, and focuses on five climate sub-sectors: clean energy, enabling solutions, decarbonized transport, greening industrials, and agriculture & natural solutions. Jim Coulter, TPG Founding Partner and Executive Chairman, serves as Managing Partner of TPG Rise Climate. Former U.S. Treasury Secretary Hank Paulson serves as TPG Rise Climate’s Executive Chairman. For more information, please visit www.therisefund.com/tpgriseclimate.