13D Article: Zinc is emerging as a key challenger to lithium-ion-based batteries for utility-scale energy storage. How to invest.
WHAT I LEARNED THIS WEEK®
Excerpt (with permission) from August 13, 2020
We have made the case since 2002 that batteries play a crucial role in electric-grid stabilization. In WILTW July 17, 2008, we underscored that energy storage will increase grid reliability, driving mass deployment of utility-scale renewable energy generation.
Several companies are accelerating efforts to bring zinc-based batteries to market. Eos Energy Storage is at the forefront of challenging lithium-ion systems and has been developing its stationary zinc battery for 12 years. The stationary battery market is expected to reach 155 GW over the next decade from just 23 GW currently, creating a $30 billion market, notes James Frith, an energy-storage analyst at Bloomberg New Energy Finance. Eos Energy, which has raised over $160 million, is on track to go public in 4Q20 through a Special Purpose Acquisition Company (SPAC) named B. Riley Principal Merger Corp. II (BMRG).
Eos Energy Storage is already putting projects in the ground and building out its deal pipeline with marquee customers. A key competitive advantage of its flagship “EOS Aurora” battery system is the ability to operate in a wide range of temperatures (-4 to 131 degrees Fahrenheit) without additional heating or cooling. Aurora batteries are estimated to last 5,000 charge cycles over a 15-year calendar life. The Eos battery is 100% recyclable and has a proprietary non-flammable electrolytic conductor that is non-hazardous and non-corrosive. The Eos Aurora is able to discharge in a range of 3-10 hours, far wider than any Lithium-ion system.
Eos batteries are modular, which allows for increased capacity by stacking multiple units, each integrated into a standard 20-foot ISO shipping container. The system does not require expensive pumps or catalysts like flow batteries, while also avoiding costly HVAC required for lithium-based systems.
Eos’s manufacturing facility is located in Pittsburgh, PA. Eos sources over 70% of its battery components in the U.S., with most components sourced within a few hours’ drive of the Pittsburgh factory, which reduces supply chain risks. The batteries produced at its Pittsburgh factory are cost-competitive with incumbent stationary storage technology. EOS continues to invest in R&D. A key objective is cost reduction by ramping up industrial-scale manufacturing. This will ensure scalability in utility, commercial, and industrial applications. The company targets 10% to 20% energy density improvements annually over the next several years.