European energy companies have spent around $1.1bn on start-ups in a bid to adapt to the changed circumstances facing their industries in recent years.

Reuters have calculated the figure, with several deals announced in the past month as they accelerate a quest for new technologies to outpace rivals.

Germany’s Innogy, France’s EDF and Dutch Eneco, as well as oil majors like Total, have set up their own venture capital funds to scour the globe for potentially disruptive technologies.
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Included in the list of technologies being examined are batteries to store solar power in massive amounts to those creating systems to better manage the use of household appliances like washing machines and thermostats.

In the past month, Statkraft’s fund, Statkraft Ventures, has invested in smart meter software company Greenbird, while Engie’s fund has bet on US home services startup Serviz and Canadian smart grid management platform Opus One Solutions.

Reuters says the motivation to adapt has been fed by the sheer amount of damage done to businesses struggling to deal with the transition to renewable energy.

Capgemini reports that energy firms have taken $27bn (EUR26bn) worth of impairments on unprofitable power plants. The consultancy also reported that Europe’s 25 biggest energy companies lost as much as 23 per cent of their market capitalisation between June 2015 and May 2016 mainly due to huge write-downs and weak energy prices.

Venture Capital funds are no longer seen as luxuries in the new order, but vital to finding innovations capable of helping firms to survive.

Analysts at investment bank Macquarie said inflexible utilities would be the losers of the radical transformation happening in the sector.

“Investors will increasingly favour European utilities which have an exposure to the technologies that will reshape the utilities sector,” they said.