ONEKA RAISES $12.5 MILLION CAD, PREPARES TO DELIVER DESALINATION DEVICES ALONG THE PACIFIC COAST
Article written BY CHARLES MANDEL published by Betakit – See article here
Cleantech startup Oneka Technologies has raised $12.5 million CAD in equity financing. The Series A round closed in the third week of September, and also leverages another $20 million CAD in grant programs confirmed earlier in 2023. Those grants come from the Ocean Supercluster (OSC), Sustainable Development Technology Canada (SDTC) and the US Department of Energy (DOE).
The Hoffecker Family led the round with participation from Horizon Capital Holdings, AQC Capital, the Wilson Family, Propulia Capital and Invest Nova Scotia.
Founded in 2015, Oneka has developed a sea-based, zero-energy proprietary desalination device that harnesses the power of waves to convert seawater into drinking water.
Totalling $32.5 million CAD, the combined financial support will enable Oneka to complete the development of its suite of products to serve all segments of the market and client types, from small disaster relief applications to utility-scale units to accommodate larger cities and industries using large amounts of water.
At its current growth rate, the desalination industry will contribute to over one billion tons of CO2e emissions per year by 2050, more than twice the emissions of the aviation sector in 2019.
This funding will empower Oneka Technologies to deliver several commercial projects to fruition, with a primary focus on locations along the Pacific coast of the United States and Chile. It will also enable the company to grow its manufacturing, R&D, sales and project management teams as it scales to utility and industrial markets.
“In the context of a more challenging fund-raising environment for startups, the closing of this round of financing represents a clear shift of investor interest for unique and credible climate tech solutions,” Oneka said in a statement.
The startup called the financing a testimony to its commercial readiness and a proven alternative to the relatively more polluting and energy-intensive conventional desalination industry offering.
The growth of the desalination industry has contributed to climate change by increasing fossil-based energy use, which in turn increases water scarcity, the very problem the industry set out to solve, according to Oneka.
At its current growth rate, the desalination industry will contribute to over one billion tons of CO2e emissions per year by 2050, more than twice the emissions of the aviation sector in 2019. With its wave-powered desalination technology, Oneka will allow the desalination industry to grow its output sustainably, without marginal CO2e emissions.
Local communities are more and more impacted by climate change, which affects their access to freshwater and capacity to sustain their own living and economic development. These communities are seeking affordable, reliable, and easy-to-operate solutions working in synergy to protect their environment and local biodiversity.
According to the UN Environment Programme, a 2018 United Nations study says there are now almost 16,000 desalination plants operating in 177 countries, producing a volume of freshwater equivalent to almost half the average flow over Niagara Falls.
The same programme notes that in most desalination processes, for every litre of potable water produced, about 1.5 litres of liquid polluted with chlorine and copper are created. This wastewater is twice as saline as ocean water.
If not properly diluted and dispersed, it may form a dense plume of toxic brine which can degrade coastal and marine ecosystems unless treated. Increased salinity and temperature can cause a decrease in the dissolved oxygen content and contribute to the formation of “dead zones,” where very few marine animals can live.
Oneka claims it is able to harness wave power to produce fresh water with zero greenhouse gas emissions, zero land use and discharging only responsible brine, using modular proprietary desalination solutions. Suitable for local communities, resorts, and industrial and mining operations, Oneka says its wave-powered sustainable desalination solutions can produce affordable clean water with no pollution, eliminating a costly and unpredictable fuel supply chain.
Oneka is headquartered in Sherbrooke, with operations in Halifax, Fort Pierce, Florida, and Algarrobo, Chile. Oneka has two demonstration sites and is now commercializing its IceCube and Iceberg units.
Oneka last raised $5.5 million CAD in 2021, which is said it would put toward delivering its first two commercial projects in the US and Chile, and growing its engineering, sales, and project management teams as it scaled to serve utility and industrial markets.
“AQC Capital has been a great believer and supporter of Oneka’s solution to freshwater access issues,” said Stéphane Caron, partner at AQC Capital. “We have witnessed Dragan and his team’s milestone achievements and market recognition growing over the years confirming our investment thesis. This significant reinvestment by our fund in this round of financing confirms that a long-term patient capital approach can be rewarded in the climate tech sector even for an early-stage VC type fund.”