Key Takeaways
- • Exergy3, an Edinburgh University spinout, raised €11.4 million to scale its modular thermal energy storage technology for industrial heat decarbonization, addressing a market addressing nearly 25% of annual greenhouse gas emissions from industrial processes.
- • The company's electro-thermal energy storage (ETES) system converts renewable electricity into thermal energy and stores it at ultra-high temperatures (up to 1,200°C), enabling industrial heat generation without fossil fuels while leveraging low-cost renewable power periods.
- • Exergy3 commissioned a breakthrough project at Annandale Distillery near Dumfries, Scotland, deploying three 30 MWh modules to deliver hot air up to 530°C for steam generation, marking the first commercial deployment of this technology globally in a heat-intensive industrial setting.
- • The technology solves three critical challenges in industrial electrification: cost competitiveness versus natural gas, electricity price volatility throughout the day, and renewable intermittency—enabling 24/7 industrial operations powered by stored renewable energy.
- • ZCC (Zero Carbon Capital) led the investment, recognizing strong market demand evidenced by an EU-wide industrial heat auction that attracted €1.4 billion in bids from 14 countries, and Exergy3's recognition as a 2025 Cleantech Group "50 to Watch" company.
Summary
Exergy3, a thermal energy storage company spun out from the University of Edinburgh, has secured €11.4 million in funding to advance its proprietary electro-thermal energy storage (ETES) technology, which converts renewable electricity into industrial heat at ultra-high temperatures. The funding round represents a significant validation of the company's approach to decarbonizing industrial heat, a sector responsible for approximately 18–25% of global CO2 emissions and historically dependent on fossil fuel combustion.
The company's modular thermal storage system addresses a critical market inefficiency in industrial energy markets. Industrial processes typically require continuous high-temperature heat delivery, yet renewable electricity generation is intermittent and electricity prices fluctuate substantially—ranging from negative during periods of oversupply to extremely high during peak demand. Exergy3's technology allows industrial operators to generate and store heat when renewable electricity is abundant and inexpensive, then discharge that stored thermal energy when electricity prices are elevated or renewable generation is unavailable. The system discharges hot air at temperatures ranging from 50°C to 1,200°C, depending on specific industrial requirements, making it applicable across multiple sectors.
Commercial validation came through a landmark deployment at Annandale Distillery near Dumfries, Scotland. The project, completed with support from the UK Department for Energy Security and Net Zero, deployed three modular units totaling 30 MWh capacity to deliver hot air at 530°C for integration with a 3 MW Cochran boiler system that generates green steam for the distilling process. This represents the first global implementation of ultra-high-temperature thermal storage in a heat-intensive industrial application. Professor David Thomson, cofounder of Annandale Distillery, described the breakthrough as economically powerful, addressing both industrial decarbonization requirements and electricity grid balancing challenges. The distillery aims to become one of the first globally to produce low-carbon whisky.
The investment landscape reflects strong institutional confidence in the thermal storage sector. ZCC (Zero Carbon Capital) led the funding round, recognizing that industrial heat decarbonization represents one of the most challenging and material emissions reduction opportunities. Market validation extends beyond single-company backing: an EU-wide industrial heat auction attracted €1.4 billion in bids across 85 proposals from 14 countries, underscoring genuine sector appetite for scalable decarbonization solutions. Exergy3's recognition as a Cleantech Group 2025 "50 to Watch" company further affirms its technological credibility and market positioning.
## DETAILED SUMMARY
The company's modular thermal storage system addresses a critical market inefficiency in industrial energy markets. Industrial processes typically require continuous high-temperature heat delivery, yet renewable electricity generation is intermittent and electricity prices fluctuate substantially—ranging from negative during periods of oversupply to extremely high during peak demand. Exergy3's technology allows industrial operators to generate and store heat when renewable electricity is abundant and inexpensive, then discharge that stored thermal energy when electricity prices are elevated or renewable generation is unavailable. The system discharges hot air at temperatures ranging from 50°C to 1,200°C, depending on specific industrial requirements, making it applicable across multiple sectors.
Commercial validation came through a landmark deployment at Annandale Distillery near Dumfries, Scotland. The project, completed with support from the UK Department for Energy Security and Net Zero, deployed three modular units totaling 30 MWh capacity to deliver hot air at 530°C for integration with a 3 MW Cochran boiler system that generates green steam for the distilling process. This represents the first global implementation of ultra-high-temperature thermal storage in a heat-intensive industrial application. Professor David Thomson, cofounder of Annandale Distillery, described the breakthrough as economically powerful, addressing both industrial decarbonization requirements and electricity grid balancing challenges. The distillery aims to become one of the first globally to produce low-carbon whisky.
The investment landscape reflects strong institutional confidence in the thermal storage sector. ZCC (Zero Carbon Capital) led the funding round, recognizing that industrial heat decarbonization represents one of the most challenging and material emissions reduction opportunities. Market validation extends beyond single-company backing: an EU-wide industrial heat auction attracted €1.4 billion in bids across 85 proposals from 14 countries, underscoring genuine sector appetite for scalable decarbonization solutions. Exergy3's recognition as a Cleantech Group 2025 "50 to Watch" company further affirms its technological credibility and market positioning.
## DETAILED SUMMARY
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