ReMo Energy: Sizing Up Investors

In 2023, executives with ReMo Energy (founded 2020) were deciding which size ammonia plant to build as their first project. Their innovative model produced ammonia—useful for making fertilizer and for energy storage—from renewable energy, and they had received funding from a prominent environmentally-conscious venture capital fund. However, they needed more funding to build their first plant. Smaller plants were less efficient, but bigger plants were riskier, and different potential funders had different priorities. The case presents three size options for ReMo’s first plant, with a detailed model of how various present and future factors—the price of ammonia, power supply, taxes, and more—affect risk and return.