The co-founder and CEO of the ‘cleantech’ firm Exergyn is sitting in his home office in the north Dublin suburb of Santry.
evin O’Toole is juggling the competing duties of being a dad to a newborn baby and what he’s going to do as the steward of a tech company that has just received a huge funding round.
For the next hour, he can focus on the latter challenge. As he explains it, Exergyn’s basic proposition is based on a grim present-day reality and an even grimmer potential future one.
“The last six summers have been the warmest on record,” he says. “We need to make a decision. This industry knows that it has a problem.”
Mr O’Toole is talking about the “problem” of leaky, harmful refrigerant gases that worsen global warming.
The giant heating, ventilating, air-conditioning and refrigeration (HVACR) industry is said to be responsible for at least 10pc of the world’s CO2 emissions.
“When you run a common heat pump in a domestic dwelling today, that pump runs something known as a refrigerant gas,” says Mr O’Toole. “The issue with these gases are that they’re extremely toxic when released into the atmosphere. They escape from the container either in use or at the end of life. The reason they’re used in the first place is that they’re very stable. That’s very good for heat retention purposes. But it’s because of that stability that they stay in the atmosphere, warming the place up.”
Exergyn’s proposed response to this issue has just received global validation in the form of a $35m (€31m) Series A round from major venture capital firms and technology investors.
The Glasnevin-based company’s technology replaces the need for dangerous fluids and gases with expandable metals in everyday things such as air conditioners, heaters and refrigerators.
“The time is right now to do this, not only because of the promise of the technology but also because regulation is coming down the line that will squash the existing systems,” says Mr O’Toole.
The HVACR industry is dominated by giant, multi-billion dollar companies whose names wouldn’t be immediately familiar to most people. The leaders are firms such as Trane Technologies (formerly Ingersoll Rand), Johnson Controls and Lennox International.
Trying to effect a conversion in how they build their machines isn’t easy.
“It’s a conservative industry,” says Mr O’Toole. “These are big OEMs (original equipment manufacturers) that can’t afford to fail or any downtime. Change is always going to be slow. I think if legislation wasn’t there around issues like this, we’d still be pumping out CFCs.”
While ‘shape memory alloy’ technology has been around for years, it has never really been applied to the HVACR business, says Mr O’Toole.
From the company’s base in DCU’s Alpha startup accelerator facility in Glasnevin, Mr O’Toole, together with co-founders Alan Healy and Barry Cullen, have been experimenting with different alloys to try and get a combination that can effectively replace what big fridges and air conditioners use today. Part of what the large funding round will be used for is further experimentation on different alloys and metals to see if a more efficient, effective alloy can be used, he says.
Despite Exergyn being around several years, making its technology work in existing industrial machines is still some way off. Mr O’Toole says that it’s not yet a ready replacement element within any of today’s heaters or air conditioners.
“Today? No,” he says. “We’re building prototypes.”
Exergyn’s role, he says, is to design the technology integration rather than build a finished article. “We’ll never construct a fully integrated heat pump,” he says. “We would instead supply chips, which is effectively what they are.”
One of the world’s biggest HVACR companies, Carrier Global, has been working closely with Exergyn on the development of a heat pump that could change the way it makes the devices.
Of the other leading multinationals in the sector, Mr O’Toole says Exergyn has been approached by “several” and has seen “positive engagement” develop as a result.
He says that the technology is “fully scalable” and can be used across more industrial sectors than just heaters, fridges and air conditioners.
“The smallest we’ve really looked at so far is battery management in electric vehicles,” he says. “EVs have to manage the temperature of a battery, both when starting on a cold day and keeping it cool. Industrial chilling is another big one for us. And water heating. The easiest way to think about this is like a Lego block. You can put this into many industries that run high-temperature applications, whatever they are.”
The €31m funding round was led by Mercuria, a global energy investment company headquartered in Switzerland, and a family-based “multi-strategy” investment firm, Lacerta Partners.
The Czech-based venture capital firm McWin also participated.
So what will it do with the money?
“We’ll really expand out,” says Mr O’Toole.
“If you look at the last couple of years, we’ve been working with a partner [understood to be Carrier Global] and developed the world’s largest solid state system. So now what we need to do is to look at our verticals, including the likes of automotive and aerospace.
“We’re not just focusing on one product, but multiple ones in a few markets. So it’s really about taking the company to the next level. We also need to build out our research capability.
“We have a second lab in Prague that we’ll put investment into and then we’ll boost the team here in Dublin, as well as possibly the UK.”
He says that the company will also become more active in regulatory advocacy.
“A secondary element of all of this is on the regulation side, both for government policy and wider understanding. When someone listens to Joe Duffy on the radio, they might in future understand the difference in heat pumps when the term solid state is brought up.”
Exergyn currently employs 33 people in Dublin, the UK, the US and the Czech Republic. It aims to increase that soon to 60 people.
Mr O’Toole says the industry will eventually come around to moving away from the current standard of refrigerant gases.
“What they’re doing at the moment is looking around and trying to get ahead early,” he says. “I think they do see this as a part of the future. They know that if they don’t change, they’ll be made to.”
