SoftBank backs high-altitude wind startup Altaeros

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Credit: Altaeros

Japanese telecom giant SoftBank is investing $7 million in startup Altaeros Energies, which has developed a helium-filled wind turbine that looks like a small blimp and floats more than a thousand feet up in the air, generating clean energy. Softbank’s CEO Masayoshi Son, who is the richest man in Japan, has become increasingly interested in clean and efficient energy technologies, and Japan’s development of new energy systems, following the Fukushima nuclear disaster.

The idea behind high-altitude wind turbines is that winds between 1,000 and 2,000 feet off the ground can be a lot stronger than winds closer to the ground. Altaeros’ turbine is supposed to be able to generate more than twice the energy of the same size of turbine mounted on a traditional wind tower. A long cable connects Altaeros’ turbine, called the “Buoyant Airborne Turbine” or BAT, to the ground and transmits the energy.

Altaeros

The four-year-old company — which was spun out of MIT and is based in Somerville, Massachusetts (out of Greentown Labs) — has been working on installing its first turbine, for a pilot project, in Fairbanks, Alaska. The team expects to launch the turbine by the end of 2015, and the project seems to have been delayed a bit due to permit issues. The Alaska Energy Authority will monitor the project and gave Altaeros a grant to help support it.

Alaska has some of the highest electricity rates in the U.S., and in certain environments, particularly remote locations, the Altaeros turbine can be less expensive, and quicker, to install and operate. The turbine can be shipped in a standard shipping container, and doesn’t need the same type of infrastructure that a traditional wind turbine needs.

The ease of installation could make the tech a good candidate for disaster zones, oil and gas mining operations, islands and other places where electricity is expensive and difficult to access. Softbank’s Son, in a press release, called the turbine a “promising renewable energy solution for remote islands and locations in Japan and the Asia?Pacific region.”

Altaeros

At the same time, though, at $0.18 per kilowatt-hour, Altaeros’ energy tech is substantially more expensive on a per–kilowatt hour basis than standard wind turbines. In some windy regions, large standard wind turbines can be deployed at scale for $0.04 to $0.05 per kilowatt hour.

But in addition to the clean energy benefits, the company’s turbine can also be used to launch communications tech, or surveillance tech, high up into the air. So the turbine could end up acting like a wireless hotspot. That in particular could have made it attractive to SoftBank, which runs the third-largest wireless carrier in Japan and bought Sprint last year.

Companies and researchers have been trying to crack the code for high-altitude wind for years, but it’s been difficult. Check out this article for more potential hurdles that Altaeros’ turbine faces.

Altaeros

Startup Makani Power has been working on high-altitude wind tech, too, but with a very different design. Its wind turbine operates more like a kite and is attached to a long tether and rotates high off the ground. Google’s secretive moonshot lab Google X bought Makani in 2013. KiteGen is another high altitude wind startup based in Italy; NASA has a team working on this technology as well.

The investment from SoftBank is Altaeros’ Series A round. Most of the startup’s previous funds have come from grants and prizes from organizations like from the U.S. Department of Agriculture, the National Science Foundation and the California Energy Commission. Ratan Tata, the former chairman of Indian conglomerate Tata Sons, has also funded Altaeros.

Whether Altaeros’ unusual floating turbine can play an important part in Japan’s energy transition remains to be seen. In the wake of Fukushima, the Japanese government looked to phase out nuclear energy and idled the country’s nuclear plants.

But nuclear made up 60 percent of Japan’s energy generation, and it’s a carbon emissions–free energy source. Japan has since said it will miss its greenhouse gas reduction targets because its power companies have replaced the lost nuclear energy with thermal energy, which uses fuel.

Solar panels being installed on a roof in Japan.

Solar panels being installed on a roof in Japan.

Idling the plants was a controversial move. Japanese Prime Minister Shinzo Abe is now looking to restart some of the idled nuclear plants. But even if that happens, Japan still has very high clean power targets. SoftBank’s Son has proposed that Japan replace all of its nuclear energy with clean power, which would be a very aggressive target.

SoftBank has developed a subsidiary to invest and develop clean energy projects in Japan called SB Energy, as well as a foundation that does clean energy policy research and lobbying. SB Energy is currently developing a variety of large solar and wind plants in Japan, exploring a wind-power project in the Gobi Desert in Mongolia, and has even reportedly been interested in developing solar in India.

Recently SoftBank also launched SB Power, a subsidiary to sell electricity to corporate users, using mostly energy from its solar plants. Japan is reforming its energy sector and opening it up to competition.

Images courtesy of Altaeros and CoCreatr, Flickr Creative Commons.

Updated at 8:15AM, December 5th to correct that Altaeros works out of Greentown Labs in Somerville, MA, not Cambridge.

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