Ice Energy Raises Cash for Energy Storage

Ice is nice, but so is cash. The startup that builds an ice-based energy storage and air conditioning system for buildings — Ice Energy — announced this morning that it has raised a $24 million Series C round of funding.

Ice Energy’s so-called “Ice Bear” air conditioner units create ice during off-peak hours (like during the middle of the night), then during peak hours (like the middle of the day) the systems cool buildings by circulating chilled refrigerant to the coil of a standard air conditioning system. The devices are cost-effective and energy-efficient because they move the cost of cooling to off-peak hours when it’s less expensive. Ice Energy CEO Frank Ramirez once told me if was the only really efficient means of storing energy out there.

Investors in this round include Ice Energy’s existing backers Energy Capital Partners, Good Energies, Sail Ventures and Second Avenue Partners, as well as new investor, financial planning firm TIAA-CREF, which has a new green building investment partnership with Good Energies. Ice Energy raised a Series B round of $33 million in mid-2008.

Ice Energy says it will use the funds, quite simply, to deploy Ice Bears to its current customer list, including its largest, a 53-MW project for Southern California Public Power Authority, as well as a solar and ice combo project with SunPower (s SPRWA) for PG&E. Ice Energy commonly installs the systems on big box retailers like Staples (s spls), or an auto dealership, then works with the local utility for the demand response system and incentives for the building owner.

At a time when batteries for energy storage remain too expensive for wide-scale deployment, when compressed air energy storage has too many siting and regulatory problems, and when pumped hydro can only be built in certain regions, ice-based energy storage looks very promising. Because of its relatively low cost and quick deployment, it’s like the low hanging fruit of building-based energy storage. (See my energy storage FAQ).

Even beyond the startup world, the so-called ice battery might be finally getting its day in the sun. Earlier this year, Veolia Energy North America (s ve), a subsidiary of massive French energy and water company Veoli Environnement, announced it had bought a district cooling system that uses ice to lower the cost of cooling buildings from Comfort Link.

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Image courtesy of Stevendepolo.