Why We Invested…
June, 2024 - Clean-tech startup Heatio secures £2m to drive net zero across UK homes
By Gabrielle Morgan, Senior Investment Manager & Natalie Otwoma, Operations Associate
Simon Roberts and Thomas Farquhar, founders of Heatio
Heatio helps customers understand their energy usage, manage their energy assets to optimise usage to reduce costs, and finance energy efficient retrofits
£2m seed funding enables the company to launch its Energy as a Service (EaaS) subscription platform, in a pilot contract for 350 homes in the Northwest working with E.ON - this aims to minimise upfront costs for consumers considering heat pumps, solar PV, or battery storage
In partnership with Perenna Bank and Energy Systems Catapult, Heatio aims to launch a long-term fixed-rate green mortgage that rewards homeowners with a preferential interest rate for retrofitting their homes with low-carbon technologies
How it works
20% of all carbon emissions in the UK come from residential homes, and more if one includes cars. In the first instance, the Heatio platform gives all users a free, personalized, and data-driven energy plan which helps homeowners understand how they can minimize their energy usage and save money. Customers who own energy assets (EVs, Heatpumps, Batteries, Solar) can then upgrade to a paid subscription, where the user can ‘hand over’ control to Heatio to manage the home’s energy usage on their behalf. Heatio Flexx links up a customer’s home to Heatio’s Virtual Power Plant, which sits between the household and the grid and integrates with customers’ green energy devices via APIs and/or with simple sensors. Based on user preferences and usage patterns, energy prices, home characteristics, and out-of-home data such as weather, Heatio can make smart energy use predictions using a sophisticated algorithm. In time, Heatio will look to switch this to an AI model to automatically optimise the usage of energy devices on a day-to-day and minute-to-minute basis to maximise efficiency and minimise costs.
Simon Roberts, CEO of Heatio, says “Our ability to help homeowners access affordable energy via our Flexx platform and VPP drives energy security and helps the UK get to a clean, green future. When we launched Heatio two years ago, our priority was to help more consumers access green technology and reduce the use of fossil fuels to decarbonise their homes. Through this investment, we are moving closer to making that a reality. We are looking forward to driving our expansion and working with industry leaders and would like to extend our appreciation to every investor for helping us get where we are today.”
Our Take
Heatio’s key differentiator is this smart, whole home approach. There are other businesses which manage single energy assets, and some energy companies give customers tools to be able to flex their own demand based on current energy prices. But Heatio stands out in its ability to manage multiple devices, combined with dynamic data and preferences, to optimise homes without a human in the loop.
To support the UK’s net zero goals, Heatio is on a mission to help homeowners overcome the initial capital costs associated with retrofitting low-carbon technologies, such as heat pumps, solar panels and storage batteries. For a typical 3-bedroom house in the UK with a £2k annual energy bill, Heatio estimates a switch to low-carbon devices could save a household as much as £380 per year. To do this, Heatio has partnered with the world’s largest asset manager to provide financing to homeowners for the installation of these devices, ensuring they are within reach for many more people. To further lower the barriers to access for homeowners, Heatio has partnered with the energy supplier, E.ON, to introduce the UK’s first ‘pay monthly’ home energy subscription.
The Conduit EIS Impact Fund invested into Heatio’s oversubscribed £2m Seed raise with Ascension Ventures leading the round. The Syndicate Room, Baltic Ventures, LYVA Labs, and deep tech investor Neil Norman also co-invested.
Alexander Shapiro, Investment Manager at The Conduit EIS Impact Fund says “The Conduit EIS Impact Fund are thrilled to have participated in this seed round. Simon and Thomas’ commitment to making renewable energy solutions affordable and accessible for everyone aligns perfectly with our fund’s vision for a sustainable future. Decarbonising household energy is a huge and wicked problem – we have been incredibly impressed by the way the Heatio team has created a product that adds value to every stakeholder in a complex market. We very much look forward to supporting Heatio's mission and contributing to their continued success."
Find out more about Heatio here.