CarbonFlow gets $1M to close Series A

San Francisco's CarbonFlow has raised an additional $1 million to close its Series A round about a month before it expects to begin selling its software for carbon-trading markets, CEO Neal Dikeman told the Cleantech Group.

CarbonFlow next plans to raise capital in the middle of 2008, Dikeman said.

CarbonFlow has developed a system to meet Kyoto standards for registration, verification,
certification and monitoring of carbon emissions.

The new funding round came from @Ventures. @Ventures is the venture capital business of ModusLink Global Solutions (NASDAQ: MLNK), which sells supply-chain management systems. The company changed its name from CMGI in late September.

CarbonFlow previously raised $2.9 million in the round from Clean Pacific Ventures, OVP Venture Partners and Meridian Energy in July (see Growing market for carbon software).

CarbonFlow's software aims to help lower the cost and time it takes to create a carbon offset credits. The software was developed for buyers, sellers and traders of credits. 

The $60 billion carbon trading market in 2006 has the potential to triple by 2015 (see Taking carbon markets to the mainstream). However, the tough standards have created high transaction costs that can range from 10 percent to 20 percent of the cost of the project, CarbonFlow says.

CarbonFlow has partnered in developing the software with Norway's Det Norske Veritas, the largest verifier of carbon credit projects in the world. DNV was the first company to be accredited by the U.N. to verify greenhouse gas emission reductions from projects in the developing world under the United Nations Clean Development Mechanism 2004.

CarbonFlow was founded in 2006.

Dikeman is also a founding partner at Jane Capital Partners, where CarbonFlow was incubated and a founding contributor of the Cleantech Blog.

Rob Day, principal of @Ventures, is also a prominent cleantech blogger (see Using superpowers for the greater cleantech good).

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