DeepCorner: Energy

Not to disturb your regular programming, but DeepCorner is back to look into the trends shaping tomorrow's startups.

Just a few weeks ago, we ran a deep dive on the future of computation. The reality is that much of the future of computation is intertwined with the future of electricity. As such, Kanay Shah is back this week to dive deep into the present (and future) landscape of energy.

Separately, thank you to everyone who joined us in Salt Lake City for our first Unicorn Club mixer. It was awesome meeting the founders and investors building from zero to one in Utah!

Arek and Ethan 🦄

What powers innovation? Bright minds and education? Inspiration and creativity? Funding? Bravado? 

While the answer to this question is very theoretical, we’re just as interested in this answer from a physical sense. What about the actual energy that powers our schools and workplaces, financial transactions, and manufacturing?

Energy has become a highly contested commodity worldwide. With oil and natural gas often spilling over, literally and geopolitically, the race to replace aging fossil fuels with alternative energy sources has become very competitive. 

AI and data center usage make headlines. Ambitious companies not only invest in their data center infrastructure, but also in the actual enablement for those centers. Unlike SaaS, where server energy sources are abstracted away, DeepTech industries are built directly on their energy sources. 

As covered in an earlier edition of DeepCorner, manufacturing drives physical progress, while computation layers on top to enhance our ability to solve complex problems. Energy is the last piece of the puzzle, making all of this (and more) run. Without energy, the silicon chips needed for physical progress could not be manufactured or used for computation. Powering the next scientific breakthrough wouldn’t be possible. Energy enables us to reach new frontiers, making it the ultimate bottleneck.

In this last foundational article of DeepTech, we’ll dive deep into the importance of energy and its role in the future of innovation.

From the beginning of time, humans have tried to optimize their energy usage. Ancient rice farmers in Asia designed irrigation systems that carried water across fields with minimal labor. Mesopotamians and Egyptians used aqueducts and water wheels to harness rivers. Early humans turned to local energy sources for fuel: wood and animal fats such as oil. Similar practices continued for millennia. 

The Industrial Revolution marked the first true energy transformation, completely shifting the paradigm. Coal and steam made possible factories, locomotives, and global trade. Sailboats went extinct in favor of steamliners. Hydropower energized mills, creating textiles and boosting efficiency, and, in turn, the economy. New methods of harvesting resources made energy into a driver of industrial and political power.

This brings us to the current paradigm, run by oil and natural gas. Gasoline engines reshaped economies, while natural gas supplied heat and electricity. Though practical, these sources continued the increasing trend in human-caused pollution, leading to renewable energy sources like solar and wind, and atomic energy. However, each has its limitations, with renewable sources impacting local environments and atomic energy igniting images of disasters such as Chernobyl and Fukushima. 

Now, we are at the precipice of yet another paradigm shift.

Energy has always been a lever of influence, and today it remains one of the most strategic arenas in global competition. Startups operating in this space cannot ignore that energy is not only a technical challenge but also a political one. Shifts in supply ripple across economies, and disruptions to pipelines or grids can slow entire industries. Infrastructure is central to this dynamic. Pipelines, transmission lines, and even water flows across borders shape who controls energy access. An example of this is hydropower, which demonstrates how natural resources are political assets, since rivers do not respect borders. For startups, this means energy innovation cannot be isolated from questions of location, resource rights, and policy.

At the same time, the supply chains for new energy technologies are becoming just as geopolitical as fossil fuels once were. This concentration shapes which nations set standards and, as a result, which startups are best positioned to scale globally. Founders working in energy must navigate these market forces.

Energy security is evolving into a race for resilience: grids that can handle intermittent renewables, supply chains that can withstand political shocks, and advanced technologies like nuclear and storage that reduce reliance on any one region. For startups, this is both the risk and the opportunity; the world needs new solutions not only to generate energy, but to secure it. The companies that succeed will not just be building power plants or batteries; they will be building resilience into the global system.

Oil is the most consumed energy source, making up the backbone of the current energy system. Derived from fossilized organisms, crude oil is then processed into the different petrochemicals we use today.

Given its broad use, there is tremendous innovation occurring in oil. As electric transportation becomes the rave, and gasoline-powered engines are phased out, many are trying to find alternatives. Synthetic alternatives, such as Porsche’s E-Fuel, show some promise. Besides alternatives to oil, there is still plenty being done to maximize the current usage right now. 

With new technology to better predict and streamline future needs, there are also developing methods to extract oil more efficiently, reducing the energy and environmental footprint. The most prominent innovation in oil is carbon capture and storage. Oil’s biggest byproduct from usage is carbon dioxide, which is a major pollutant. Many companies are finding ways to not only capture this surplus carbon dioxide from the environment, but also store and reutilize it for energy.

Coal, one of the oldest modern fuels, powered the Industrial Revolution and remains the second most used energy source worldwide. Extracted from carbon-rich plant matter compressed over millions of years, coal has long been the cornerstone of industrial power generation and heavy industry. Developing countries especially use coal with oil, given its cheapness.

Today, innovation around coal is not about expanding its use but minimizing its impact. Coal and oil face many of the same problems, with overlapping solutions. The most prominent example of this is carbon capture, given that coal is also a massive pollutant with a byproduct of carbon dioxide. Carbon capture and storage systems are being retrofitted to existing plants to trap emissions before they reach the atmosphere. Some projects even look to repurpose this carbon dioxide, turning waste into value.

Beyond emissions, there are efforts to improve combustion efficiency and to hybridize older coal plants with biomass or gas, extending their utility while lowering their carbon footprint. Although coal’s role is steadily declining in developed economies, innovation is centered on reducing the damage from its continued use in regions where it remains indispensable.

Natural gas, often considered the bridge fuel to renewable energy, is cleaner-burning than coal and oil and plays a central role in electricity generation, heating, and industrial processes. Though, just like coal and oil, natural gas is found underground, primarily composed of methane, and is widely used.

Innovation in natural gas is focused on reducing leaks. Methane leak detection is a major priority, with satellites and sensors being deployed to track and minimize emissions, which is critical since methane is a far more potent greenhouse gas than carbon dioxide. On the grid side, utilities are experimenting with blending hydrogen into existing gas pipelines to reduce carbon intensity.

There is also progress in liquefied natural gas technology, with modular and small-scale LNG plants allowing for more flexible transport and storage. LNG can potentially offer an alternative to oil, and it is something already being tried in small-scale transportation systems. At the power generation level, advanced gas turbines are being paired with carbon capture systems to make natural gas plants more sustainable. While natural gas is still a fossil fuel, it is being reshaped to fit into a world that increasingly demands cleaner, more efficient energy solutions.

Hydropower works by converting the kinetic force of flowing water into energy through turbines. It is the world’s largest renewable energy source, becoming a reliable foundation for many national grids, particularly in countries with abundant rivers and elevation. Today, it is harnessed at massive scales.

Innovations in hydropower are shifting away from building massive dams toward smaller, more flexible systems. Run-of-the-river projects allow electricity generation without large reservoirs, reducing environmental disruption. Micro-hydro systems are also being deployed in rural or remote regions, providing localized clean energy at low cost. Like all other energy systems, advanced monitoring and AI-driven optimization are making existing dams more efficient and better integrated with modern grids.

Tidal and wave energy are natural extensions here. Still in their early stages, they aim to capture the enormous and predictable power of the oceans. Startups are testing durable underwater turbines and floating buoys that can withstand harsh marine conditions while converting wave motion and tidal flows into electricity.

Wind energy harnesses air currents to generate electricity using turbines. From early windmills that pumped water and milled grain to today’s massive turbine farms, wind has become one of the fastest-growing renewable sources worldwide. Onshore farms dot open landscapes, while offshore projects are increasingly being built at large scales in the water where winds are stronger and more consistent.

Innovation in wind is all about making turbines bigger, stronger, and smarter. Floating offshore wind farms are now being built in deep waters, opening up areas that were impossible to use before and massively increasing potential output. On land and sea, taller towers and longer blades are helping capture stronger, steadier winds higher up, pushing efficiency even further. At the same time, materials are improving, with startups working on recyclable designs to cut down on waste.

On the operations side, digital tools are making a difference. AI and sensors are being used to predict when turbines need maintenance, reducing downtime and keeping wind farms running longer. Better grid integration is also making wind more reliable, especially when paired with storage. 

Solar power captures energy directly from the sun using photovoltaic panels. The rapid drop in panel costs over the past two decades has made solar one of the most accessible renewables, both in developed and developing regions.

Innovation in solar is happening on multiple fronts. New types of solar cells are one of the most promising developments, offering higher efficiency and lower production costs compared to traditional silicon panels. Building-integrated photovoltaics, like solar windows and roof tiles, are also bringing electricity generation closer to the consumer and turning infrastructure into energy producers.

Other advances aim to squeeze more power from every panel and adapt panels to be more versatile. Solar-tracking systems follow the sun’s path during the day, boosting output. Storage pairings are becoming the norm, helping smooth the intermittency problem caused by sunlight and making solar more viable as a baseload source. 

Nuclear power uses the energy locked inside atoms to generate electricity, either by splitting them apart (fission) or fusing them together (fusion). Since the 1950s, nuclear fission has provided steady, large-scale power with virtually no carbon emissions, making it one of the most efficient baseload sources on the grid. However, accidents and waste concerns have made it politically divisive and slow to expand.

On the fission side, companies are developing small modular reactors that can be built faster, operated safely, and fit into grids without the massive infrastructure of traditional plants. Advanced reactor designs also aim to use fuel more efficiently and generate less nuclear waste.

Fusion, long considered the “holy grail” of energy, is finally showing momentum. Startups and government labs are experimenting with magnetic confinement via tokamaks and laser-based approaches, each racing to achieve net energy gain. 

Biomass is humanity’s oldest source of energy, fueling communities for thousands of years. Even now, it remains vital in developing regions, while in industrial settings, it has evolved into power plants and biofuels.

Innovation in biomass today is about turning it into a true alternative to fossil fuels. It is already being used as a grid power plant alternative to fossil fuels, and advanced biofuels made from crops, algae, and waste are being developed to replace gasoline, diesel, and even jet fuel without requiring new engines or distribution systems. Airlines in particular are testing sustainable aviation fuel blends, seeing biomass as one of the only viable decarbonization paths for aviation.

Renewable natural gas from agricultural and municipal waste can be injected directly into existing pipelines, functioning as a drop-in substitute for traditional natural gas. Similar approaches are being used to produce liquid biofuels that work in standard combustion engines, easing the transition for industries that can’t quickly electrify. Paired with carbon capture, biomass could even deliver negative emissions, actively removing carbon dioxide while supplying energy. 

Geothermal uses steam or hot water from underground reservoirs in areas such as volcanic zones or hot springs to generate electricity or provide heat. It’s one of the few energy sources that can run around the clock, independent of weather or daylight. However, for decades, geothermal energy was limited to regions with geothermal activity, such as Iceland.

Enhanced Geothermal Systems are the most promising geothermal development. It uses advanced drilling to create artificial reservoirs in places without natural ones, thereby unlocking geothermal potential around the world.

At the same time, companies are adapting oil and gas fracking and horizontal drilling techniques to reach deeper heat sources more efficiently. Some startups are even experimenting with closed-loop systems that circulate fluids through deep underground pipes without extracting water or steam.

Hydrogen is often called an energy carrier rather than a source, since it does not occur in nature in its pure form. However, it has an innate ability to be stored in fuel cells to generate electricity or be burned directly for heat and industrial processes. While still a small part of the global energy mix, it has the potential to fill gaps that renewables and batteries struggle to cover.

Innovation today is focused on making hydrogen cleaner and cheaper to produce. Most hydrogen today is considered gray, or made from natural gas with high emissions. Efforts are underway to scale blue hydrogen, which adds carbon capture to the process, and green hydrogen, which uses renewable electricity and electrolysis to split water into hydrogen and oxygen. Electrolyzer costs are falling as technology improves, and governments are investing heavily in scaling production hubs worldwide.

Beyond production, hydrogen is being tested as a replacement fuel in industries that are difficult to electrify. Heavy-duty transport is piloting hydrogen fuel cells that can refuel quickly and travel long distances. In steelmaking and other high-heat industries, hydrogen is emerging as an alternative to coal. On the infrastructure side, utilities are blending hydrogen into existing gas pipelines, and startups are experimenting with safer storage and distribution methods. 

Startups in DeepTech are well-equipped and developing for the future of energy. When reactivating nuclear plants was theorized, technology companies were the ones to get it done. Unicorner companies like Intramotev and NetworkOcean are taking energy-heavy industries and finding ways to optimize energy usage to be more sustainable. Qnetic is developing flywheel technology to more efficiently store energy, and Twelve directly attacks the carbon footprint issue by converting carbon dioxide to essential products. 

The type of energy that emerges as the most dominant will not just be the most sustainable, but the most economic. The largest energy source, fossil fuels, is not a renewable source, and as more is consumed, the quicker the Earth’s reserves are depleted. As classic supply and demand shows, as supply goes down, demand, and therefore cost, will go up.

Industry plays an important role here, too. SpaceTech specifically is currently totally reliant on fossil fuels for propulsion. Advanced material development relies on petrochemicals, which require an energy-intensive process. Other sectors in DeepTech rely on the electrical grid.  

The biggest winners will be the countries and companies that properly develop a robust energy stack that can fuel their ventures. Whether by making their processes more energy efficient, developing alternative energy sources, or focusing on cooperative goodwill, energy will lay the foundation for any future development in any respective space.

Manufacturing, computation, and energy form the trifecta that grounds DeepTech. They are the hard realities that determine what’s possible, what scales, and what remains stuck as theory. Together, they form the foundation on which every breakthrough is built.

With these foundations laid, DeepCorner is ready to move beyond the infrastructure layer and into the frontier itself. The next chapters will explore the sectors that stand to reshape entire industries: space, climate, biology, advanced materials, and robotics. Each is a story of science turning into engineering, and engineering turning into companies.

As these founders bend the fundamentals into world-changing applications, DeepCorner will be following closely. We’ll pick apart the science, meeting the builders and investors, and, of course, spotting the next unicorns before they emerge. This is the next frontier, and DeepCorner will be there to chart it.

• Energy and AI [International Energy Agency]

• Geopolitical tensions are laying bare fragilities in the global energy system, reinforcing need for faster expansion of clean energy [International Energy Agency]

• AI Energy Usage to its Climate Footprint [MIT Technology Review]

• What is Deep Tech and How it Can Accelerate the Energy Transition [Institute of Entrepreneurship Development]

• Energy Production and Consumption in the United States [PennState]