Incubatenergy Network
Part of How Governments Support Clean Energy Start-ups
How Governments Support Clean Energy Start-Ups highlights and unpacks government initiatives that help entrepreneurs get new clean energy technologies to the market, and offers recommendations to inspire innovation policy for net zero emissions. Read the report, and explore the case studies.
Government: United States
Responsible government entity: Department of Energy and National Renewable Energy Laboratory (NREL)
External partner: Electric Power Research Institute (EPRI)
Target type of innovator: Energy entrepreneurs at all stages of development, notably those that are complementary to electricity suppliers’ businesses
Links: www.energy.gov/eere/technology-to-market/national-incubator-initiative-clean-energy-niice-0; https://techportal.epri.com/incubate-energy
Key elements:
- The initiative addresses a co‑ordination gap in the innovation ecosystem, by helping incubators to share knowledge and create pathways for start-ups to progress through the right types of incubator and accelerator support.
- The objective of the government-funded initiative was to build a system that filled a gap in the ecosystem and could then be continued by the private sector without public support. NREL and EPRI achieved this outcome.
- The network, run by EPRI, has now expanded to include Incubatenergy Labs, a partnership for testing and demonstrating with utility companies.
Summary of the types of support provided or enabled by the policy initiative
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Type of support |
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Financial |
Infrastructure |
Services |
Networking |
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Indirect: EPRI was funded to help start-ups to understand and navigate the variety of incubator services in the United States |
Indirect: EPRI was funded to strengthen the innovation ecosystem and help networking |
In 2012, the US Department of Energy identified that a lack of interaction between incubators in the United States was hindering start-ups from finding opportunities and investment. The government awarded a grant to NREL and EPRI, a private not-for-profit members’ organisation for electric utility and associated companies, to launch and run a network of incubators and accelerators for clean energy technologies between 2014 and 2018.
The Incubatenergy Network’s objectives were to be a comprehensive source of information about US clean energy incubators, to foster engagement and communication among them, and to provide a rich resource of experts and mentors. The goal was also to learn from the most effective incubators about what makes them successful and share that information with newcomers to increase their chances of success.
While the public funding expired in 2018, EPRI’s members elected to continue operating the network with their own funds, and it is still an active resource with around 30 incubators and connections to laboratory facilities.
How support is made available and allocated
N/A
Financing
N/A
Infrastructure
While the government-funded Incubatenergy Network, NREL was supported to provide national energy laboratory expertise to participants in the network. More recently, EPRI’s member companies have supported technology demonstration as part of Incubatenergy Labs.
Services
The Incubatenergy Network connects independent incubators and accelerators. It is focused on the United States, which has a well-established ecosystem of energy-related incubators, but also welcomes international participation. The logic for the government intervention is that start-ups across the country now have better access to the appropriate resources they need because incubators exchange information with one another and receive updates from the network co‑ordinator. This information could relate to new opportunities at incubators, requests for services to support specific start-ups, proposals for co‑investment, government funding opportunities or referrals of start-ups ready to move to a new phase of development.
Today, the network includes incubators, accelerators, industry experts, utility companies, investors, and legal and business consultants.
Networking
While the government initially established the network to foster networking between service providers, it has expanded to provide networking benefits to start-ups as well. It has also broadened internationally, which helps start-ups to access overseas funding and markets. The network first opened its doors to overseas incubators and EIT InnoEnergy joined, and now EPRI plans to open a European office and is exploring opportunities in Asia.
Evaluating and tracking impacts
Tracking greenhouse gas emissions and other impacts has not been a focus for the network, though some of its members do have metrics to do so.
EPRI and the Incubatenergy Network evaluate their effectiveness based on connections made between incubators, such as memorandums of understanding, as well as connections made between entrepreneurs and industry partners. In 2019, EPRI and NREL summarised some of the achievements of the start-ups in the Incubatenergy Network, including funding received, revenues generated, patents applied for and number of people employed.
Experiences and learnings so far
Since its creation, members of the Incubatenergy Network have supported more than 1 000 early-stage start-ups, estimated to have helped create 3 000 jobs. More than USD 1 billion has been invested in start-ups by members of the Incubatenergy Network, and these companies have earned USD 330 million in revenue. The initial government backing played a core role in bringing network members on board and raising interest among incubators in clean energy technologies specifically.
As an organisation that works for corporate members in the electricity sector, EPRI’s involvement has taken the network in unanticipated directions. It has raised awareness of new ideas and technologies among utility companies and helped them to see the complementarities for their own businesses. Since 2018, EPRI has extended the Incubatenergy Network to include a new element: Incubatenergy Labs. EPRI has run Incubatenergy Labs since 2020 by selecting start-ups to work jointly with several EPRI members on demonstration projects to accelerate their introduction into the electricity sector, or identify unforeseen technical or regulatory challenges.
Incubatenergy Labs fits well in the context of the electricity sector. The barriers to market entry established by regulations and natural monopolies can be high, yet very few utilities in the United States are in direct competition with one another. Utilities can therefore co‑operate on demonstration projects, learn jointly about new technologies and provide them with a path to market by joining forces. In Incubatenergy Labs, EPRI helps its members to create projects for co‑funding by groups of several utilities. The rationale is that such demonstration projects provide a template for future projects at other locations, reducing risk and helping to troubleshoot, create standard contracts and raise awareness of the technology.
Incubatenergy Labs runs annually from June to September, which limits the projects to those that can be implemented in a 16‑week period. Equipment that can be quickly deployed at a utility’s facility is suitable, or simulation-based testing. In 2021, 15 utilities supported 16 start-ups selected from 253 applicants. Participating start-ups provide biweekly updates and receive midpoint reviews and technology development support from the participating EPRI members.
Complementary and related programmes
Most of the incubators in the Incubatenergy Network programme have some federal, state or municipal funding in the form of grants, tax breaks or real estate. These include LACI in Los Angeles; Greentown Labs in Boston and Houston; ACRE, funded by the New York State Energy Research and Development Authority (NYSERDA); and Cyclotron Road in Berkeley.
Energy Program for Innovation Clusters (EPIC) supports energy innovation ecosystems and stimulates energy hardware development in regions across the United States by awarding grants to regional initiatives. There is a focus on interior states that do not already have leading energy innovation ecosystems.
This publication has been produced with the financial assistance of the European Union as part of the Clean Energy Transitions in Emerging Economies programme. This publication reflects the views of the International Energy Agency (IEA) Secretariat but does not necessarily reflect those of individual IEA member countries or the European Union (EU). Neither the IEA nor the EU make any representation of warranty, express or implied, in respect to the article's content (including its completeness or accuracy) and shall not be responsible for any use of, or reliance on, the publication.
The Clean Energy Transitions in Emerging Economies programme has received funding from the European Union’s Horizon 2020 research and innovation programme under grant agreement No 952363.
