First it was California, which experienced year after year of deadly wildfires. Then came Hawaii’s deadly firestorm this year. Camp, Dixie and Lahaina aren’t just three of the deadliest, most destructive wildfires in U.S. history; they are also all caused by downed power lines or faulty equipment owned by electric companies.
Utilities have long known about the hazards posed by trees growing close to power lines, but the successive disasters threw the issue into sharp relief.
Wildfire risk isn’t just a problem for utilities in California or Hawaii. It’s a concern anywhere there has historically been a strong fire regime, where climate patterns and evolution have created the right conditions. It’s also a growing issue in a range of ecosystems that are now threatened with the possibility of catastrophic fire thanks to climate change.
Three years ago, when it was becoming clear that wildfire risk was here to stay for utilities, Indra den Bakker and his colleagues at Overstory heard from a utility in Europe. At the time, Overstory specialized in identifying forest cover in satellite images and tracking how it changed over time. The idea for the company was borne out of a competition sponsored by Planet to see who could most accurately monitor deforestation in the Amazon.
“Our initial customer base was a little bit more horizontal with more data-as-a-service. We were serving the forest industry, an NGO, a bank as a customer,” said den Bakker, who is co-founder and CEO of the startup. After a few years, the company knew it was time to focus.
At the time, “one utility came to us and said, ‘You know a lot about trees. We have a big issue with trees.’ That was new to us,” he told TechCrunch+. “The moment we learned about the market, about their problems, I think the more strongly we felt like this is a problem we can help solve.”
Today, Overstory is entirely focused on the utility market, with 90% of its customers in North America. “It’s more about focus and where do we spend our time,” den Bakker said. That’s not surprising given that utilities on the continent have likely been spooked by PG&E’s bankruptcy, its billions in debt related to the fire, and the 84 counts of manslaughter it pleaded guilty to as a result of the Camp Fire that leveled the town of Paradise, California.
Overstory recently closed a $14 million Series A led by B Capital with participation from The Nature Conservancy, TechCrunch+ has exclusively learned.
Overstory’s software ingests high-resolution commercial satellite imagery and runs it through its models trained via machine learning to determine which trees pose the biggest threat to power lines and other equipment. It usually captures a broad buffer around the lines, about 1 to 2 km wide, to get a picture of overall forest health. “It’s not only about declining trees that can hit their lines, but also general declining trees in the areas so that they can spot where the problems are,” den Bakker said.
Utilities pay an annual fee for every mile that Overstory scans for them. The potential market is pretty large. California alone has nearly 26,000 miles of transmission lines and 147,000 miles of overhead distribution lines, much of them over rugged and fire-prone territory.
Customer interest appears strong. Den Bakker said that the company has more than 40 utility customers, and it’s working with four of the 10 largest utilities in the U.S. along with a number of small and midsize electric cooperatives. He wouldn’t disclose revenues but said subscription revenues have been tripling year-over-year.
Overstory’s focus on utilities appears to be well timed. California’s string of devastating wildfire seasons certainly suggested that the market was poised to grow rapidly, but the company just as easily could have decided to hitch its wagon to the ESG train that was also gaining steam at the time, zeroing in on carbon credits, for example. As a business, the decision is paying off.
Still, it is a little sad that the company’s technology, which started out tracking deforestation, has had to set aside a key plank in its original mission, at least for now. For that, Overstory shoulders none of the blame.
With wildfire risk, “you don’t have to explain the business model to our customers; they know the business model,” den Bakker said. “While for deforestation, to make it actionable and explain the business model, it’s still a little bit of a gray area.”
Sounds like a failure of the market if there ever was one.