Sun. Aug 14th, 2022

Fleetzero has an ambitious goal: to compete with worldwide shipping companies with its own boats, completely powered by electricity. The company has just secured $15.5 million in new financing and is looking to convert the first vessel to run on its containerized batteries.

The company’s plan, detailed here, is to convert existing ships to electric propulsion, replacing the diesel engine or generator with huge batteries of their own design. These would be loaded and unloaded just like any other cargo, exchanged in ports and charged between voyages. Well done (and it seems likely that’s the way they’re trying to do it), a ship that does this can tackle some of the longest and most popular routes across the Pacific.

But while it all sounds good in theory, at some point you have to put these theories on the water, and that’s the next step for the company. Fortunately, co-founders Steven Henderson and Mike Carter have backgrounds in shipping and shipbuilding and are excited to jump in.

While Fleetzero’s technology could eventually power ships in the 700-foot range, it makes sense to start with something smaller, but that also benefits battery power.

“Companies across the spectrum have reached out to us in all sectors – not just container shipping,” says Henderson. “So we’ve gone through the list of the largest auxiliary carriers, such as supply ships for oil and gas companies and research ships, and say, okay, we have this technology and our goal is to eventually do our own cargo, but we want to prove it with a partner.” so we don’t have to spend millions on the first ship.”

Surprisingly, this is “will you give us a boat?” pitch went pretty well. “People are so interested in our batteries that they are willing to pay” U.S to test them,” Henderson added. Ultimately, Fleetzero plans to make their own boats, but that’s a long-term goal.

It helps to understand that there is a wide variety in seagoing vessels and their operators. Some large companies own and operate, some only own or operate alone, some have short-term rental fleets and so on. The ability to electrify their ships has a different charm to all of these, though some are more likely to bite first.

One of those brighter prospects is the aforementioned “auxiliary” category of ships: these are things like research vessels, ships going to inspect offshore wind farms, and other tasks that require a serious boat and crew, but not the hyper-specialized bulk movers of container ships. Many of these ships are already partially electrified – they use electric motors powered by diesel generators. It sounds like the worst of both worlds, but I’m sure they have their reasons – and more importantly, they’re very easy to convert to Fleetzero’s battery technology.

“It’s a minimal scope; the conversion itself takes a matter of weeks and does not require a dry dock,” says Henderson. “A PSV in the best case” [platform supply vessel] about 250 feet long, we put our batteries on the back deck and just plug them in. †

You just change the motor and put the batteries there. Not to scale. Image Credits: Fleet Zero

Such a conversion would be an important proof of concept; although the company has a lot of inbound traffic, there are certainly doubters who would like to see a working ship before committing resources.

Carter noted that Fleetzero is one of the relatively few companies really trying to move the needle in shipping. While logistics and supply chain economics certainly have their share of innovation on the data and services side, the ships and shipping companies themselves have stagnated.

He even pointed out that the White House recently released a report complaining that “three global alliances, made up entirely of foreign companies, control almost all ocean freight.” And when they say almost everything, they mean it: we’re talking about 95% of some critical trade lines. The FBI will investigate price fixing (and in fact just passed a law), but supporting a sustainable US alternative is a good idea too.

It’s hard to challenge such a dominant set of incumbents (who might be called a cartel at this point), and Fleetzero can’t claim to be a fresh new startup, but their approach neatly avoids the most direct competition.

The electrified vessels that the company is building with shipping partners will operate parallel to traditional lines and use smaller ports that are inaccessible to large container ships. This saves time (less waiting for a spot at the docks) and money (cities with disused ports are eager to reactivate them) and ensures a robust network of loading and unloading stations in the Pacific. Of course, they also need to make some friends in Southeast Asia.

The new funding was led by Breakthrough Energy Ventures, the Bill Gates-led venture group that the man himself spoke about recently on TC Sessions: Climate. Apparently they were big on due diligence – it shouldn’t come as a surprise, but there it is.

BEV was not alone, however; Founders Fund, McKinley Capital and previous investors also contributed. Carter said McKinley, who is based in Alaska, was important to get, given that the state naturally occupies much of the US Pacific coast.

The money will be crucial to building and testing the first ship, but Fleetzero is also hiring – they had 1,500 candidates for 10 positions after coming out of stealth. It suggests that a lot of people in the shipping world are interested in the business, or maybe a lot of people in other companies are interested in the shipping world.

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