As Europe accelerates its transition to renewable energy, the ability to balance fluctuating supply and demand has become one of the grid’s most urgent challenges. Finnish sustainable technology company Capalo AI is positioning itself at the centre of this shift. The Helsinki based startup has completed an €11 million Series A funding round to expand its AI powered virtual power plant and scale the optimisation and trading of battery energy storage systems across European electricity markets.
The funding round was led by Heartcore Capital, with participation from Finnish Industry Investment Tesi. Existing investors VentureFriends, PROfounders, Inventure, and Innovestor also increased their commitments, alongside several family offices. The capital injection marks a significant step forward for Capalo AI as it moves from early market traction to broader international expansion.
Turning batteries into intelligent grid assets
Founded in 2022 by Henri Taskinen, Riku Kukkonen, Teemu Lappalainen, and Eerik Jauhiainen, Capalo AI develops software designed to maximise the commercial and system value of battery energy storage systems. Rather than treating batteries as static infrastructure, the company positions them as intelligent, flexible assets that can actively respond to market conditions.
Capalo AI combines high resolution forecasting data with proprietary AI models to optimise how batteries are charged, discharged, and traded across electricity markets. This allows asset owners to increase revenues while supporting grid stability during periods of volatility.
The company aggregates battery storage systems and renewable energy assets from multiple locations into a single virtual power plant. This structure enables real time orchestration across markets, improving efficiency while reducing the burden on transmission networks.
Managing volatility in a renewables driven grid
Europe’s power system is undergoing rapid change. The growing share of weather dependent energy sources such as wind and solar has increased variability in supply, while demand continues to rise due to data centres, electric vehicles, and electrification of industry. This combination is placing pressure on grids and driving higher system costs.
Capalo AI’s platform addresses these dynamics by enabling batteries to absorb excess energy when supply is high and release it during periods of scarcity. By optimising this process through AI driven decision making, the company helps stabilise electricity markets while improving the economics of storage investments.
According to co founder and CEO Henri Taskinen, intelligent coordination is now essential. He notes that infrastructure alone cannot solve the challenges created by rapid renewable deployment and rising electricity demand. Instead, software driven optimisation is required to ensure reliability, affordability, and sustainability.
Expanding a pan European virtual power plant
Capalo AI is currently active in Finland, Sweden, Latvia, and Lithuania. Its platform supports both stand alone battery systems and batteries co located with wind or solar generation. Following the Series A round, the company plans to deepen its presence in existing markets while entering additional European countries in 2026.
The new funding will be used to scale operations, strengthen the company’s trading capabilities, and expand its optimisation technology to support a larger and more diverse portfolio of energy assets. Capalo AI also plans to grow its team as it prepares for the next phase of expansion.
Software as critical energy infrastructure
As Europe moves toward a cleaner energy system, batteries are becoming a foundational component of modern power grids. Capalo AI’s approach highlights the growing role of software in transforming physical energy infrastructure into adaptive, revenue generating systems.
By combining AI driven forecasting, real time market access, and virtual power plant aggregation, Capalo AI aims to play a central role in enabling the renewable energy transition while maintaining grid reliability. With fresh capital and a growing international footprint, the company is now focused on scaling that vision across Europe.