Energy efficiency is one of the biggest drivers of decarbonization and sustainability, an area of focus for Partners Group, which recently committed $500 million in Budderfly, which helps businesses cut energy use.
“We identified a number of top players in the sector and Budderfly’s name kept popping up,” according to Todd Bright, a partner and co-head of Partners Group’s private infrastructure Americas. Bright spoke to PE Hub about the opportunities in the sector.
The world is racing to meet net-zero emissions by 2050, an aggressive target that it is hoped will help regulate rising global temperatures. Investors, utilities and energy producers are taking steps to lower carbon emissions and promote renewable energies.
Budderfly, an Energy-as-a-Service (EaaS) company, helps businesses such as restaurant chains and assisted living facilities cut energy use through technologies that promote energy efficiency.
The suite of upgrades that Budderfly is focusing on can be repeated across multiple sites. The company’s technology can help customers save both on money and help them achieve their decarbonization targets, Bright said.
Among other services, Budderfly can collect hordes of energy records per day, audit them, do carbon reporting and manage energy loads in real time. “They are taking away this low-hanging fruit in terms of decarbonization,” he said.
This can be a way to save on costs, Bright said, especially in a tight macro-environment where businesses are grappling with means to reduce operating expenses. The US economy is experiencing high inflation that peaked to a four decade-high in June.
Bright said Partners Group will help Budderfly grow organically through signing up more customers especially by penetrating the healthcare and retail sectors.
He said onsite generation of electricity could be another growth path. “We think there is an opportunity to install some rooftop solar and battery storage or some other types of backup generation that can help during peak times.”
Partners Group is expecting a hold period of between five to seven years, a period that Bright assumes will be sufficient to scale Budderfly.
“We want to give it a long enough runway to really get up to scale,” he said.