Exergy3, a CleanTech startup, has raised €11.4 million (£10 million) in Seed funding to scale its ultra-high temperature thermal energy storage technology.
The round was led by Axeleo Capital, with participation from Bayern Kapital and Kibo Invest, alongside existing investors including Scottish Enterprise, Zero Carbon Capital, and Old College Capital. The company focuses on converting surplus renewable electricity into industrial heat, addressing inefficiencies in energy systems while supporting decarbonisation efforts.
What The Company Does
Founded in 2023 as a spinout from the University of Edinburgh, Exergy3 develops thermal energy storage systems designed to deliver high-temperature heat for industrial applications. Its technology converts excess renewable electricity, such as curtailed wind power, into usable thermal energy.
The company’s modular storage units are built for integration into existing industrial environments, offering process temperatures ranging from 50°C to 1,200°C. These systems remain compact and require limited additional infrastructure, making them suitable for deployment across a range of energy-intensive sectors.
By enabling both direct heat use and steam generation, Exergy3 provides an alternative to fossil fuel-based industrial heating, which remains one of the more difficult areas to decarbonise.
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Market Context / Industry Background
European energy systems are facing increasing pressure as renewable energy generation expands. While wind and solar capacity continue to grow, mismatches between supply and demand have led to rising grid balancing costs and the curtailment of excess electricity.
In the UK, significant public and private resources are allocated each year to manage these imbalances. At the same time, industrial sectors continue to rely on stable and high-temperature heat sources, often derived from carbon-intensive fuels.
Thermal energy storage is emerging as a potential solution to bridge this gap, enabling surplus renewable energy to be stored and repurposed for industrial use. This approach supports both emissions reduction and improved energy efficiency, while contributing to greater resilience in energy systems.
In addition, integrating thermal storage into existing industrial processes allows companies to optimize energy consumption without requiring major infrastructure overhauls. This is particularly relevant for sectors with continuous heat demand, where flexibility in energy sourcing remains limited. As energy markets evolve, interest in technologies that can balance intermittency while maintaining operational stability continues to increase, positioning thermal storage as a practical component within broader decarbonisation strategies and long-term planning.
Founder / Investor Commentary
Markus Rondé, CEO of Exergy3, described the challenge as a structural imbalance between energy supply and industrial demand. He noted that large volumes of renewable electricity are currently underutilized, while industries continue to require reliable heat at scale.
He explained that Exergy3’s approach connects these two issues by converting surplus renewable power into consistent, lower-cost heat for industrial processes. According to Rondé, the new funding will enable the company to transition more quickly from pilot projects to commercial deployment.
Growth Plans / Use Of Funds
The capital will be used to scale manufacturing capabilities, expand the company’s team, and accelerate deployment across industrial sites. Exergy3 plans to increase its workforce significantly, with the goal of doubling headcount by the end of the year.
The company also intends to expand geographically, including the opening of a Munich office to support its entry into the German market. This move reflects a broader strategy to position itself in key industrial regions where demand for decarbonised heat solutions is growing.
About Exergy3
Exergy3 is a CleanTech company focused on thermal energy storage for industrial applications. Founded in 2023 as a spinout from the University of Edinburgh, the company develops systems that convert renewable electricity into high-temperature heat. Headquartered in Edinburgh, Exergy3 aims to support industrial decarbonisation by improving energy efficiency and reducing reliance on fossil fuels.
