Verdant Power Inc.
Building Sustainable Communities with the Power of Water
Verdant Power is a marine renewable energy company that has developed underwater turbines, which are much like wind turbines, but are deployed in the currents of rivers, tides, oceans and canals to generate clean power. The proceeds from the Netcapital offering will be used to advance the Company and its proven technology toward commercialization in New York City and its ultimate launch into the global marketplace.
Verdant Power’s mission is to help build sustainable communities by producing clean power and water from this new renewable energy source. The Company’s underwater turbines convert the kinetic energy from the water currents of oceans, tides, rivers, and canals into electrical and mechanical power. This clean power will be produced near where electricity and clean water are most needed - where people live. The mechanical power can be used to pump water for irrigation purposes.
By commercializing now, the Company is preparing for projects worldwide that will harvest this reliable and predictable source of new renewable energy for community resiliency, given climate change. Verdant Power’s proven, proprietary modular technology will be readily scalable and easily integrated with other clean tech technologies for hybrid power systems. It addresses the water-energy-food nexus - the critical approach to water management and the clean energy revolution.
Introducing Verdant Power
Verdant Power was founded on sustained impact through on-going innovation and is focused on long-term results. It is an early-stage disruptive technology developer of marine renewable energy (MRE) technologies, services, and integrated systems, including its proprietary fifth generation (Gen5) Free Flow System (FFS) turbine. The Company, headquartered in New York, NY, was established in 2000 and has subsidiaries in Canada and the UK.
The Company is a leading MRE technology provider and project developer, utilizing its proven proprietary system, which has generated more than 70,000 kWh of commercially viable electrical power and has logged-in more than 9,000 operational hours. It has developed an expertise in MRE technologies, energy systems, water resource assessment, site analysis and development, project design, and project operations and maintenance.
Verdant Power’s pilot project, which has been developed in New York City’s East River, the Roosevelt Island Tidal Energy (RITE) Project, was the first grid-connected array of MRE technologies in the world and is a recipient of the first-ever issued U.S. Federal Energy Regulatory Commission (FERC) pilot commercial license for MRE tidal generation.
The RITE Project is supported by various public and private institution funding, including New York State Energy Research and Development Authority (NYSERDA) and the U.S. Department of Energy (DOE). This demonstration project will be followed by village and utility-scale commercial projects around the world.
Verdant Power’s Free Flow System (FFS) is a water-to-wire system utilizing horizontal-axis turbines that convert the hydrokinetic energy of fast moving (> 1.8 m/s) water currents into clean renewable mechanical and electrical power. The FFS is designed for placement in the water currents of oceans, tidal straits (using a passive yaw system), rivers, and large canals and is installed fully under water, invisible from shore. The central component of the FFS is an open three-bladed composite rotor, which is rotated by naturally flowing water currents. This rotating motion of only 32 rpm drives an induction generator, located within the main body of the turbine, to generate electricity, which is transferred to onshore equipment via underwater cable. As part of its first ever FERC pilot commercial license approval process, Verdant Power passed a rigorous environmental impact assessment process and to the satisfaction of 23 resource agencies and environmental groups demonstrated that the rotation does not affect fish, birds, or animals that swim around, rather than through the slow revolving rotors.
The fifth generation (Gen5) FFS will be the Company’s “commercial standard system” that is tailored to specific sites. It can be scaled to a range of sizes and arrayed in various configurations allowing for versatility in project siting and power delivery arrangements (urban, village, offshore, distributed generation, baseload, etc.).
The environmentally benign Gen5 FFS is designed for simplicity in order to make it robust and reliable, as well as to minimize assembly and maintenance costs. Since inception, the development of the FFS has focused on simplicity, reliability, and ruggedness to extend service life and minimize on-water work. The Gen5 FFS will be an optimized system that currently is undergoing testing of key components, such as failsafe brakes, composite blades, and integrated gearbox units ahead of manufacturing for operation at the RITE Project in New York. In parallel with final testing and manufacture of the Gen5 FFS, the Company also is focused on a design cycle that integrates the Gen5 FFS with a TriFrame™ mounting system to optimize deployment and retrieval by installing three Gen5 FFS simultaneously. It also is focused on operations and maintenance (O&M), which are key cost drivers in MRE projects and is the critical formula in the delivery of affordable power.
The TriFrame™ mounting system will support three Gen5 FFS at once onto seabeds and riverbeds cost-effectively. The benefits of the new mounting system, include the following:
- Provides for utility-scale systems ranging from 100 kilowatts (kW) to 1.5 megawatts (MW) or more on each TriFrame™;
- Allows greater adaptation for utility and village-scale systems in more common water conditions than just deep, offshore tidal straits; and
- Lowers O&M costs due to faster deployment and retrieval.
One of the greatest challenges in the transition of the energy market to renewable power is the episodic nature of wind and solar power. Wind doesn’t always blow and the sun doesn’t always shine. They are technologies that cannot produce according to the demand, but are producing according to the weather. Not so for MRE technologies. River and tidal flows are very reliable and predictable, which allows this new renewable energy to produce according to the demand.
The opportunity for utility-scale projects, ranging from 5 MW to more than 400 MW using Verdant Power’s Gen5 FFS, is shaping-up in tidal energy projects. The Company has identified several countries, including the U.S., UK, Ireland, and China. An immediate opportunity for village-scale MRE projects, ranging from 100 kW to 5 MW is taking shape with river energy projects in countries such as Canada, Turkey, Zimbabwe, and Brazil. There are more than 2,000 “diesel villages” in the Amazon basin. All are nestled alongside tributaries to the Amazon River, if not near the river itself. The very costly and dirty diesel gensets of these villages could be relegated to emergency use only by replacing them with Verdant Power’s MRE technologies.
Furthermore, over recent years there has been a steady stream of investment in clean energy and particularly in MRE. This new renewable energy is helping to reshape power systems around the world, by being used for distributed generation (DG) as well as for village- and utility-scale hydrokinetic power plants. It can also be used to add capacity to existing hydropower plants and dams by being sited downriver from dams to capture otherwise wasted energy due to increased river flows caused by climate change.
According to the Institute of Electrical and Electronics Engineers, energy from rivers supplies about one-fifth of the world’s electricity with more than 1,064 gigawatts (GW) of installed capacity. More than 60 countries get over half their electricity from conventional hydropower.
However, governments worldwide are actively seeking to address the shortcomings of current conventional hydropower technologies and practices in order to foster both security and stability and to mitigate climate change.
Certain key factors have proved crucial in elevating the role of clean and sustainable technology in the global economy including:
- A recognition of the inability to sustain the pace of modern development under current traditional technologies and practices;
- A greater awareness and acceptance of global climate change causes; and
- The socio-economic and political implications of an over-dependency on finite and polluting hydrocarbon resources.
Predicting hydropower’s future, scientists at the Norwegian University of Science & Technology found that some areas will experience reductions in river flow and thus conventional hydropower output, due to climate change, but other areas will see a boost in runoff.
Some countries in areas where river runoff is likely to increase have the ability to adapt quickly—for example, by adding MRE technologies, such as Verdant Power’s Gen5 FFS, as incremental hydropower to already existing dams to put the extra flow to effective use.
The Intergovernmental Panel on Climate Change Special Report on Renewable Energy Sources and Climate Change Mitigation (2011) section on marine renewable energy states: “While Ocean Energy includes generation from ocean tides, currents and waves, it is believed that its most practical application in the near term is likely to be in rivers.”
The total worldwide technical potential for hydropower generation corresponds to an installed capacity of 3,721 GW, roughly four times the current installed capacity. However, countries are no longer building “high” dams, because of their environmental impacts. This creates an opportunity for MRE technologies to capture some of that potential hydropower generation estimated to be more than 250 GW. The Company’s commercial standard system, the Gen5 FFS, is uniquely suited for rivers and tides and is readily scalable and tailored for specific sites.
A Growing Opportunity
Renewable energy is one of the most effective tools to fight against climate change. Renewable technologies can increasingly save customers money while displacing fossil fuel plants and their polluting emissions. Wind and solar energy have experienced remarkable growth and huge cost improvements over the past decade with no signs of slowing down. Prices are declining rapidly, and renewable energy is becoming increasingly competitive with fossil fuels all around the world, particularly when externalities are incorporated into costs. In some places, renewable energy is already cheaper than continuing to operate old, inefficient and dirty fossil fuel-fired plants. In addition to the climate benefits that they will help deliver, renewables already provide a wide range of market and public health benefits that far outweigh their costs.
MRE is the new renewable energy, and it will be reliable and affordable. Unlike large fossil fuel-fired plants for which the timing of when they will have to shut down for critical maintenance is uncertain, underwater currents are reliable and predictable. They also are more reliable than either wind or solar energy. And, just like other renewable technologies, such as wind and solar power, the costs for Verdant Power’s Gen5 FFS will be declining, too, as its systems replace dirty fossil fuel-fired plants and standalone systems, such as diesel gensets in rural villages. Mass manufacturing of Verdant Power’s modular systems will contribute to declining costs by providing additional capacity at existing hydroelectric dams as an alternative to building new dams. In addition, as added value, the Company’s Gen5 FFS can be used to help produce potable water and provide irrigation pumping, which will far outweigh their present-day costs.
Of the Total Addressable Market (TAM) of more than 250,000 MW for MRE, the Electric Power Research Institute (EPRI) estimates the Serviceable Available Market (SAM) to be more than 23,000 MW of installed capacity, which is predicted to be reached by 2028. Verdant Power’s portfolio of projects represents more than 3,000 MW. This is the Company’s Share of Market (SOM) that is projected to be installed within the next 10 years, which represents an estimated $12 billion in total project costs/value.
What Makes Verdant Power Different?
Unlike its competitors, which are primarily European-based and are designing MRE technologies for deep, offshore tidal straits, New York-based Verdant Power has designed its Gen5 FFS for use not only in offshore and near shore tidal straits, but also for rivers and large canals.
Competitors’ systems are heavy, complex, and complicated. They are not adaptable to sites. Rather they are designed for the most part to be installed in water depths of 35 meters or more and are costly because of the extensive on-water work that is required and corresponding use of high cost, large deployment vessels.
Verdant Power’s Gen5 FFS is light and simple, and yet rugged. It can be tailored to specific sites and is readily scalable allowing for a greater range of applications, while efficiently harvesting site power potential. It is designed for installation in water depths ranging from 10 meters to 50 meters or more and is less costly than competitors, as less on-water work is required and there is greater flexibility in vessels used. Furthermore, as a result of being sited nearer power needs, the Gen5 FFS will require little, if any transmission costs and will have lower O&M than its competitors. The Company has developed, tested and proven its MRE technology. It has been validated by the industry, U.S. DOE, and NYSERDA. Verdant Power’s FFS has reached a NASA / DOE-based technology readiness level (TRL) 5/6 and is focused on TRL 7/8/9 by 2019 at the RITE Project site.
Why Invest in Verdant Power?
- Proven management team shows breadth and good balance of seasoned business people, engineers and scientists having collective experience in early-stage businesses
- Funding positions Verdant Power at forefront of a global marine renewable energy market
- Interest expressed by customers represented by governments, which have signed the Paris climate agreement, independent power producers, and electric / water utilities
- Investor returns realized through project finance leveraged commercial project profitability, based on annual projected recurring revenue model
- Generation of high internal rates of return by the realization of a liquidity event in 2024
Members of senior management have been together for more than seven years and are widely experienced and accomplished clean energy professionals, each with more than 30 years of experience. It is a proven management team showing breadth and good balance of seasoned business people, engineers and scientists having collective experiences in start-ups.
Global corporate finance and investment banking career with Chemical Bank; HSBC & others. John Banigan has extensive senior management experience with Chemical Bank, HSBC, and others related to corporate and trade finance and investment banking operations in Asia, Latin America, and the US. He has managed mature financial services operations, directed the finance function at a range of public and private companies, formed start-up businesses, and consummated foreign-based joint ventures.
Formerly with Edison Electric Institute; P&G; British Telecom; BGE; and Price Waterhouse. Trey Taylor has a wide range of experience with Edison Electric Institute, ITT Corporation, British Telecom, Ogilvy & Mather, and Procter & Gamble in business development and marketing. He currently serves on the Renewable Energy & Energy Efficiency Advisory Committee for the US Department of Commerce and previously served on the Board of Directors for the Hydro Research Foundation.
Formerly with Booz-Allen; Bendix Aerospace Group; Harvard Business School. Ron Smith has served as an industry manager at Booz-Allen Hamilton, Bendix Corporation, and the US Navy. At Booz-Allen, he played a lead role in building the firm’s Worldwide Technology Business Change Management Practice, and at Bendix Aerospace Group he provided strategic and operational consulting to over 20 mechanical and electronic manufacturing divisions. He is a graduate of the Harvard Business School.
Innovator of all of Verdant Power's systems, beginning in 1989; NYU Research Scientist; M.S. Energy Science. Dean Corren has over 30 years of experience in the field of energy research and systems design. He is the original innovator of the Free Flow System design, responsible for the research conducted from theory to model tests and full scale prototypes during his time as a Research Scientist for the New York University Department of Applied Science. He has also chaired the Burlington Electric Commission.
Jonathan Colby has over 10 years of experience in MRE turbine blade design, hydrodynamic modeling and analysis, and project planning and operations. He is a recognized leader on the International Electrotechnical Commission (IEC) Technical Committee for Wave, Tidal, and Other Water Current Converters (TC 114) developing International Standards, and is active on the IEC Conformity Assessment Board (CAB) supporting the creation of a Conformity Assessment System for the Renewable Energy industry, including the Marine Energy sector.
Aaron Hernandez has 20 years of experience in corporate development for business and not-for-profit organizations in the areas of cleantech, community engagement, and economic empowerment. In addition to this work, he also supports regulatory compliance and project management planning for the groundbreaking RITE Project in New York, NY.
Mary Ann Adonizio has 30 years of experience in electric utility capital project implementation, in particular construction, operation and maintenance for small hydroelectric and transmission projects. She also provides feasibility and financial/economic planning; regulatory licensing and permitting; and environmental risk management services for renewable energy projects.
Jeff Calkins has more than 35 years of operations management and manufacturing engineering experience with Toyota, Western Electric Company, and Robertshaw Controls - a leading supplier of electronic controls. He directed operations for lean manufacturing at TRW Automotive worldwide and served on the Board of Examiners for the Michigan Quality Leadership Council.
Success So Far
Verdant Power has a compelling market position in the emerging marine renewable energy industry. The Company has 15 years of technology development experience. It has successfully raised over $37.5 million of funding, which has been invested in RD&D and business development. This has allowed Verdant Power to move successfully along at a quarter of the costs, which its competitors have spent, to conclude the first two of its four milestones:
Milestone 1 (2002-05): FFS Prototype Test in NYC East River
Milestone 2 (2006-17): Design and Innovation - New York project (Demo)
- World's first grid-connected array of tidal power systems (RITE Project)
- First-ever Federal Energy Regulatory Commission (FERC) issued pilot commercial license
- First-ever Trade & Development Agency funding support for MRE feasibility analysis
- Government and institution support:, U.S. DOE, U.S. Department of Commerce, U.S. Navy, NYSERDA, Cornell University, New York City Economic Development Corporation (NYCEDC), and Sustainable Development Technology Canada (SDTC)
Milestone 3 (2018-21): Demonstration, Qualification, and Implementation
- Qualify Gen5 FFS by demonstrating commercial standard system, advancing to TRL 7/8/9
- Design/scale/demo Gen5, 7m and 10m FFS in operational environments
- Implement intellectual property (IP) plan
- Complete revenue generating resource assessment and feasibility analyses (“RAFAs”)
- Transition the RITE Project to a world-class test and demonstration facility
Milestone 4 (2020-28): Launch of Commercial Projects
- New York projects build-out and commercial operation
- Ireland, UK, China, and other tidal energy projects
- Canada, southern Africa, SE Asia, and other river energy projects
Customers of the Company’s technologies and services are end users or project sponsors including utility companies, independent power producers, investor sponsors, and other owner/operator entities. Verdant Power’s revenues and profits will be derived from resource assessments and feasibility analyses (“RAFAs”), the supply of technology and equipment and maintenance services to full-scale commercial projects.
According to the U.S. Department of Energy “The Water Energy Nexus: Challenges and Opportunities - June 2014,” several trends are increasing the urgency to address the water-energy nexus in an integrated and proactive way:
- Climate change is affecting precipitation and temperature patterns around the world;
- Population growth and regional migration trends are likely to increase, complicating management of energy and water systems;
- New technologies in energy and water domains shift water-energy demand; and
- Developments in policies are introducing additional incentives and challenges for decision making.
An integrated, strategic approach can guide technology research and development (R&D) to address regional water-energy issues and also have impact at the national and global scale.
Verdant Power’s mission is to help build sustainable communities through integrated energy and hybrid power systems, microgrids, and water management.
One of the Company’s objectives for its Milestone 3 is to transition the RITE Project to a world-class test and demonstration facility. Verant Power will be showcasing hydropower as distributed generation (DG) and MRE-based integrated energy systems, including clean water systems, before the UN. This will help lay the foundation for MRE-based hybrid power systems incorporating distributed energy resources (DER), such as wind, solar, and energy storage, for microgrids and in support of grid resiliency.
More than 844 million people in the world – one in ten – do not have clean water. And, an estimated 16 percent of the world's population — 1.2 billion people — have little or no access to electricity. Verdant Power’s clean energy and water systems can address these problems.
Partners, Relationships, and Supporters Include:
Awards and Recognitions
- Esquire Magazine “America’s Best & Brightest”
- Engineering News-Record magazine featured “Cover Story”
- The National Hydropower Association’s prestigious “President’s Award”
- Energy Ocean International’s “Company Pioneer Award”
- Veteran Wireless Operators Association’s “Innovations Award”
- International Electrotechnical Commission’s “Young Professional Leaders Award”
- American National Standards Institute’s “Next Generation Award”
- Funding awards (28) to date issued by NYSERDA, US and Canadian Governments, others
- National Geographic - Verdant tested ducted turbines and its Gen5 FFS on a TriFrame™
- Verdant Power Wins European Award for Testing Turbine Blade in Ireland - July 2017
- TriFrame™ Demonstration Project Advances with $3.75M DOE Funding - June 2017
- Verdant Isles, a J-V with Ireland’s Duggan Brothers (Contractors) Ltd - March 2016
- USTDA Supports Renewable Energy Development in Turkey - March 2014
Be a part of Verdant Power Inc.
By becoming an investor in Verdant Power, you will be joining a leading company, in a globally emerging marine renewable energy (MRE) industry, which is commercializing its technology in New York City. The Company’s technology and resulting integrated energy and hybrid power systems will help support building sustainable communities around the world that are resilient to climate change. Being developed in New York, an innovation hub for the world, Verdant Power’s water–based clean energy technology can be deployed as the essential component in addressing the water-energy-food nexus. A nexus approach is critical for water management.
Your facilitating investment provides a bridge to the demonstration, qualification and implementation of Verdant Power’s fifth generation technology at the RITE Project site in New York City. You will be joining the Verdant Power family on its journey to meeting the needs of large and small communities worldwide.
Verdant Power sends regular shareholder reports on its progress, and those of us at the Company are always available to answer any shareholder questions at any time.
This is an offering of Common Stock, under registration exemption 4(a)(6), in Verdant Power Inc.. This offering must raise at least $10,000 by August 7, 2018 at 4:00pm ET. If this offering doesn’t reach its target, then your money will be refunded. Verdant Power Inc. may issue additional securities to raise up to $1,069,950, the offering’s maximum.
If the offering is successful at raising the maximum amount, then the company’s implied valuation after the offering (sometimes called its post-money valuation) will be:
7,040,152 shares × $7.00 per share = $49,281,064 implied valuation
These financial statements have been reviewed by an independent Certified Public Accountant.
Verdant Power Inc.’s SEC Filings
The Offering Statement is a formal description of the company and this transaction. It’s filed with the SEC to comply with the requirements of exemption 4(a)(6) of the Securities Act of 1933.
We’re also required to share links to each of the SEC filings related to this offering with investors.
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Understand the Risks
Be sure to understand the risks of this type of investment. No regulatory body (not the SEC, not any state regulator) has passed upon the merits of or given its approval to the securities, the terms of the offering, or the accuracy or completeness of any offering materials or information posted herein. That’s typical for Regulation CF offerings like this one.
Neither Netcapital nor any of its directors, officers, employees, representatives, affiliates, or agents shall have any liability whatsoever arising from any error or incompleteness of fact or opinion in, or lack of care in the preparation or publication of, the materials and communication herein or the terms or valuation of any securities offering.
The information contained herein includes forward-looking statements. These statements relate to future events or to future financial performance, and involve known and unknown risks, uncertainties, and other factors, that may cause actual results to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties, and other factors, which are, in some cases, beyond the company’s control and which could, and likely will, materially affect actual results, levels of activity, performance, or achievements. Any forward-looking statement reflects the current views with respect to future events and is subject to these and other risks, uncertainties, and assumptions relating to operations, results of operations, growth strategy, and liquidity. No obligation exists to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.