Meridian Energy invests in US software start-up

Carbon trading software attracts Kiwi energy giant

Meridian Energy is investing in San Francisco-based CarbonFlow, a developer of software for carbon market participants. Meridian will work with CarbonFlow to develop and pilot its software platform, says Meridian spokeswoman Claire Shaw.

Meridian is an investor alongside Clean Pacific Ventures, a San Francisco venture capital company, and Olympic Venture Partners, a Seattle venture company.

Between them, they have invested US$2.9 million (NZ$3.9 million) in first round funding. Meridian identified carbon as a strategic issue for its business and customers a number of years ago, says Shaw. The company recognised there was a problem and started to explore ways of either mitigating that risk or taking advantage of market development. Its relationships with key players in the clean technology venture capital space created the opportunity to invest in CarbonFlow, she says.

“CarbonFlow can deliver carbon infrastructure that is currently missing, which is an internet-based workflow program that shifts a predominantly paper-based process onto a digital platform,” says Shaw.

The CarbonFlow venture would create value for Meridian by reducing the cost and time to create, verify and validate carbon credits, says Shaw.

Using an internet-based platform will drive down the costs of creating a carbon credit, which is currently about 20-25% of credit value, she says.

The CarbonFlow platform also allows Meridian to begin looking at more programmatic carbon credit opportunities, as CarbonFlow speeds up the carbon credit creation process through independent validators, such as Det Norske Veritas, and through to the two Kyoto Protocol mechanisms JI (Joint Implementation) and CDM (Clean Development Mechanism), she says.

Since 2004, Meridian has been engaged across many aspects of the carbon value chain —creating both Kyoto-compliant and voluntary carbon credits; developing emission inventories and emission reduction plans; having third party certified carbon neutral electricity and purchasing carbon credits for its own carbon neutrality, says Shaw.

“We partnered with CarbonFlow because we recognised their capacity to provide a solution vexing the carbon credit supply chain, which was one of quality and bottleneck,” she says.

The founders of CarbonFlow have good relationships with some of the key players in this emerging global market and Meridian saw value in being able to leverage those relationships, she adds.

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