Information on the target
Twelve™ is a pioneering company based in California, USA, specializing in advanced low-carbon synthetic fuel generation technology. The company utilizes proprietary CO2 electrolysis equipment to produce carbon monoxide (CO) with significantly lower energy consumption compared to traditional methods. Twelve™ aims to manufacture eFuel, a low-carbon synthetic fuel derived from CO and hydrogen (H2). This innovative approach alleviates concerns associated with competing for food production and securing raw materials, which are prevalent in other low-carbon fuel production methods.
With a focus on the aviation industry, Twelve™ has secured a 14-year supply contract with the International Airlines Group (IAG), which includes British Airways and Iberia, in response to the growing demand for synthetic fuels driven by decarbonization initiatives in Europe. The company is well-positioned to meet the rising demand for synthetic fuels, contributing to the decarbonization of hard-to-abate sectors such as long-distance transportation and the chemical industry.
Industry overview in the target’s specific country
The synthetic fuel industry is gaining traction globally, particularly in the United States, where regulatory frameworks and technological advancements are fostering innovation. The U.S. government has been actively promoting clean energy initiatives, which include investments in renewable energy technologies and the development of sustainable fuel alternatives. This supportive environment is crucial for companies like Twelve™ that are at the forefront of low-carbon fuel production.
In California, the state has implemented stringent emissions regulations and ambitious climate goals, driving demand for alternative fuels. The aviation sector, in particular, is under pressure to reduce its carbon footprint, leading to increased interest in synthetic fuels as a viable solution. As airlines seek to comply with environmental regulations and meet sustainability targets, partnerships with innovative companies like Twelve™ are becoming essential.
Furthermore, the collaboration between private equity firms and technology developers is accelerating the commercialization of synthetic fuels. Investment from funds like the Japan Hydrogen Fund, which focuses on sustainable energy solutions, exemplifies the growing interest in supporting companies that can deliver on the promise of low-carbon alternatives. This trend is expected to continue as more stakeholders recognize the importance of transitioning to sustainable energy sources.
The rationale behind the deal The investment in Twelve™ by the Japan Hydrogen Fund represents a strategic move to capitalize on the burgeoning demand for low-carbon synthetic fuels. By aligning with a company that possesses cutting-edge technology and a strong market…