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NOVATO – A hand-picked team of scientists at PAX Streamline has come up with an air-cooling system that could remove up to 80 percent of electricity from the grid and revolutionize the way large spaces are cooled.

Led by telecom veteran John Webley and backed by an investment from multi-billionaire and green-tech proponent Vinod Khosla, the spinoff from PAX Scientific announced its first product today, a technology with far-reaching implications.

“In a sense we’ve produced the first solar-powered air conditioner, but without the use of solar panels,” said Mr. Webley, a former colleague of telecom pioneer Don Green and founder of Turin Networks.

Simply put, the air is cooled without the use of refrigerants by passing it over saltwater, which absorbs heat-bearing moisture and can lower the temperature up to 20 degrees.

Think of visiting the coast on a 90 degree day. The breeze coming off the ocean is likely to be a refreshing 70 degrees.

The dry air, propelled by a fan designed around nature’s efficiencies, is pumped into and around a large interior space such as a big box store.

Meanwhile the saltwater, swollen in volume by moisture it has drawn from the air and now less saline, is pumped by the same efficient technology through a rooftop thermal unit that releases the moisture to the outside air and restores the water to its original salinity.

“An air conditioner literally freezes the air to rid it of moisture. You can’t stand in front of one for long, but you don’t need to cool the air that much,” said Mr. Webley.

And air conditioners consume an enormous amount of electricity. In California, 30 percent of all energy use goes to air conditioning.

“It’s a terrible strain on the grid because everyone turns it on during the hottest part of the day. Power stations have to be built to withstand that surge of demand. Then it goes away, but the stations still have to be maintained,” he said.

This “peak-demand problem,” has bedeviled utilities for years, preventing them from amortizing the cost of power stations.

“It you could take just 50 percent of that demand off the grid, you’d do more toward solving the energy crisis than all the solar installations in the state,” said Mr. Webley. “It’s much easier to save energy than produce it.”

He and his team at PAX Streamline share the goal of PAX Scientific founder Jay Harman of designing industrial products that mimic the efficiencies of nature. Mr. Harmon spun off PAX Mixer, PAX Water and PAX Fans in addition to PAX Streamline to develop the products.

“But it’s easier to market a system than a product. Out of several possibilities, we chose to develop an air-cooling system just because of the energy savings it would represent. Also, our system utilizes the PAX Water pump and PAX Fan,” said Mr. Webley.

The initial target market is big box retail, and several large chains have jumped at the opportunity to beta the technology, he said.

PAX Streamline will begin the beta tests during June and July. At the end of the year, the team hopes to have enough data on energy and cost savings to begin manufacturing in earnest.

By then its staff will have grown from 23 employees to more than 30.

“After that, a serious ramp could take us to 100 to 200 by the end of 2010,” he said.

PAX Streamline is currently funded by an infusion of $6 million by Silicon Valley venture capitalist Vinod Khosla. Mr. Webley said his company will seek another round at the end of 2009.

Given the low cost of operating the system, the PAX Streamline team calculates it will pay for itself in less than two years.

“And the benefit to air quality is incalculable. No Co2 needs to be recaptured,” he said.

Steve Slayzak at the National Renewable Energy Laboratory has labeled the technology disruptive, meaning it has the potential to replace existing technologies. Mr. Webley agrees.

“This is a brand new technology utilizing principals that have been known to man for years. They’ve been known to nature forever.”