3E Nano Inc. plans to use a recent influx of funding to further commercialization of its heat-reflecting nano-coating for polymers that significantly reduces a building's energy consumption.

The Toronto-based company received a $5-million grant from Sustainable Development Technology Canada (SDTC) earlier this year, and recently announced approximately $5.4 million in a funding round led by Chicago-based cleantech venture capital firm Energy Foundry.

“The new funding is to try to commercialize this new coating, and the markets that we're interested in are the window market, because that's the primary area of need for buildings. (In) the building envelope, the windows are the weak link in the chain. That's where the energy is escaping,” Steve Ferrero, 3E Nano’s CEO, told SustainableBiz.

He explained most windows have an R value – a measure of their ability to prevent heat escaping – of R3, compared to walls that are between R30 and R40 and ceilings that are around R60.

“We love to put these big transparent openings at R3 and wonder why we have such high energy consumption. Buildings are responsible for 40 per cent of greenhouse gas emissions, and a majority of that is for heating and cooling for human comfort.”

3E Nano was founded in 2015 working out of a University of Toronto lab. The company kicked into gear in July 2018 with its first SDTC funding of $2.72 million that upgraded the product to a technology readiness level (TRL) of six. Ferrero joined as CEO in August 2021 after 34 years in the acrylics industry.

3E Nano’s commercialization

The company’s nano-coating is made up of three layers of aluminium and silver, creating a single stack. Normal low-emissivity glasses are typically comprised of nickel, chromium and indium.

The company states that in a window application, the nano-coating can let in solar heat and light while keeping the radiated heat inside. According to Ferrero, going from R1 to R8 would save over 70 per cent of energy lost through the windows.

The second phase of the project, bolstered by the recent funding, is aimed at scaling up the technology to TRL nine, increasing the potential size of the nano-coating to two metres and eventually achieving its first revenue. TRL is used to determine the maturity of a technology — TRL nine is the highest level.

“(It means) getting this made, getting it scaled up, getting commercialized, getting it tested and validated and building the first market product,” Ferrero said. “So SDTC two as we call it, (the) second project is really to go beyond just the invention of the technology, which was the first project and now to ‘Okay, guys, now what are you going to do with it?’ “

Currently, the company states a window with a 3E Nano-coated polymer will have an R-value of eight at $40 per square foot.

Internal estimates show a $2-billion polymer market in Canada and the U.S., with the company capable of reaching $350 million in revenue at scale annually. 3E Nano is currently outsourcing the coating production to a third party, which will make the nano-coating available on films. These films can then be integrated onto polymer manufacturing lines and then sold via existing channels to market.

Each machine is capable of producing one to two million square metres annually. “If we want to sell 10 million metres, then we need five of these machines,” Ferrero said.

A company presentation pegs the size of the window market alone — once its at scale — at $520 million in revenue annually.

Other investors in the funding round include MUUS Climate Partners, ACT Venture Partners, Creative Ventures and New Climate Ventures.

3E Nano’s future

The current funding does not include plans for a production facility, but Ferrero envisions the next phase including a Series A round to build a factory in the Toronto-Montreal corridor to serve the local market “and maybe even into the U.S.” The Series A is targeted for May 2025 with a goal of between $25 and $50 million.

“We want to create this highly efficient, condensed value chain, automated, high-performance, low-cost window line,” he explained. “So our Series A will be a portion of this idea, our Series B will go larger and then our Series C would be maybe duplicating them around the world . . . put one in New York, put one in Toronto.”

While the company is starting its commercialization with an application for windows, the nanocoating can be applied to a variety of products and surfaces. Its website lists automobile, greenhouse, aerospace and even bird-friendly glazing as possibilities.

With its technology, 3E Nano aims to reduce global greenhouse gas emissions by one gigatonne by 2050.