What if the biggest untapped power plant of the AI era was hiding inside the data centres themselves?
U of T Engineering startup Cardinal Volta aims to turn waste heat — the same heat data centres spend billions trying to get rid of — into electrical power.
The company, co-founded by Professor Aimy Bazylak of U of T’s Department of Mechanical & Industrial Engineering (MIE) and U of T Engineering alumnus Nan Ge(MechE 1T3, MIE MASc 1T6, PhD 1T9), has been named the Stage 2 recipient of the Eva and Allen Lau Commercialization Catalyst Prize.
Hosted by U of T’s Centre for Entrepreneurship (CfE), the prize was established in 2025 through a $2-million gift from Eva Lau (IndE 9T2) and Allen Lau (ElecE 9T1, ECE MASc 9T2), both U of T alumni and entrepreneurs.
The Catalyst Prize is designed to bridge the funding gap between the initial phase of an invention and the stage when it becomes an investment-ready venture by providing educational workshops, mentorship, workspace and access to prototyping labs. The prize also offers non-dilutive funding that is matched by the Faculty of Arts & Science and the Faculty of Applied Science & Engineering.
Over the next few months, the Stage 2 support will help Cardinal Volta’s work in two areas: identifying the most valuable way to use recovered heat inside a data centre, and understanding how these facilities buy new technology.
Turning waste into value
Cardinal Volta captures heat that data centres and industrial facilities already produce and converts it into electricity, without burning any more fuel.
The scale of the opportunity is significant. The team’s early modelling suggests that a large AI data centre campus could generate up to 15 per cent more usable power by recovering its own waste heat. For a two-gigawatt site, that’s up to 300 megawatts of extra capacity, roughly $260 million in annual electricity value, and 1.1 million tonnes of avoided carbon emissions each year compared to generating the same power from natural gas.
“AI and advanced computing are becoming power-constrained,” the team explains.
“The challenge is no longer only how to cool servers. It is also how to provide enough reliable electricity to support the next generation of computing.”
When research becomes a company
Bazylak brings deep expertise in thermal sciences and energy systems from her research at U of T, while Ge brings experience in product development, manufacturing and project finance from the energy and cleantech sectors.
“A deep-tech energy company cannot succeed on science alone,” they say.
“It needs rigorous technical thinking, credible execution and the ability to work across engineering, finance and operations.”
For both of them, the shift from research to venture came from seeing the same problem from different angles.
“The realization came when we saw how rapidly electricity demand was growing, well outpacing our grid capacity,” says Bazylak.
“It became clear that recovering waste heat was vital for the energy transition.”
Ge saw it from the commercial side. “The opportunity was not simply to improve an energy device,” he says.
“It was to build a company that helps power-constrained sectors, including computing, unlock new capacity from energy that is already being wasted.”
Stage 1 takeaways
For Bazylak, Stage 1 of the Catalyst program has been an accelerated introduction to a new way of thinking.
“The Catalyst team has been there to mentor us in a way that moves us forward at an accelerated pace, while still nurturing the entrepreneurial mindset of a beginner,” she says.
An early workshop with Professor Hong Luo, CfE’s academic director, has stayed with her. Luo asked the team a single question: what value do you bring to the customer?
“I find myself continually coming back to this question,” Bazylak says. “The value and worth of the product has to be clear to everyone at every step of the way.”
For Ge, the biggest takeaway was focus and comfort with uncertainty.
“Stage 2 is not about proving that our first hypothesis must be right,” he says. “It is about generating the evidence needed to make the right deployment decision.”
Beyond a single product, the founders see Cardinal Volta as part of a bigger shift.
“We want to help create a future where computing growth, industrial growth, Canadian manufacturing and climate responsibility can advance together.”
Cardinal Volta’s journey, alongside fellow Stage 1 venture Continuum Robotics Laboratory, highlights the power of supporting early-stage innovators at a critical moment in their growth. As the next round of the Catalyst Prize launches in Fall 2026, the Centre for Entrepreneurship remains committed to helping U of T founders transform breakthrough ideas into solutions that create lasting impact.
