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Seeing value in trash, harvest power raises $110M


Food scraps and trashed Christmas trees could one day be a source of a billion-dollar business, according to Harvest Power, a start-up that just raised $110 million to help convert organic waste to energy and fertilizer.The company’s waste-to-energy approach reflects a broad movement in the U.S. to get value from waste, rather than expensively transporting it to municipal dumps. Waste Management, the largest trash processor in the U.S. and a Harvest Power investor, has vowed to stop using landfills altogether in a number of years, and cities including San Francisco and Seattle are beginning to separate food and yard waste. Meanwhile, New York City is evaluating new waste-to-energy facilities for some of its trash. The Waltham, Massachusets - based company, founded in 2008, has some heavy hitters behind it. Generation Investment Management, a firm co-founded by Al Gore, is an investor, as are venture capital firms Kleiner Perkins Caufield & Byers and DAG Ventures. Leading the latest financing, a Series C round, was True North Venture Partners, a new investment firm launched by Michael Ahearn, interim chief executive of major solar panel manufacturer First Solar.

The deal is the 14th largest clean-technology deal since January 2011, according to Dow Jones VentureSource.

Harvest Power is hoping to replicate in North America what countries such as Germany and Spain have been doing for years. Worldwide, the capacity for processing municipal solid waste using anaerobic digestion–in which bacteria digest organic material and emit biogas, which can then be converted into compressed natural gas or burned for power, with the byproduct used as soil fertilizer–grew five-fold between 1995 and 2008, according to a 2010 report by Ljupka Arsova, formerly a research associate at the Earth Engineering Center at Columbia University. But the U.S. has only a couple of pilot facilities.

“We’re basically building the first nationwide organics management company,” said Paul Sellew, chief executive of Harvest Power.

Source: The Wall Street Journal

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