The world’s electric grids are creaking under the pressure of volatile
fossil-fuel prices and the imperative of weaning the world off
polluting energy sources. A solution may be at hand, thanks to an
innovative battery that’s a cheaper alternative to lithium-ion
technology.
SB Energy Corp., a U.S. renewable-energy firm that’s an arm of Japan’s
SoftBank Group Corp., is making a record purchase of the batteries
manufactured by ESS Inc. The Oregon company says it has new technology
that can store renewable energy for longer and help overcome some of
the reliability problems that have caused blackouts in California and
record-high energy prices in Europe.
The units, which
rely on something called “iron-flow chemistry,” will be used in
utility-scale solar projects dotted across the U.S., allowing those
power plants to provide electricity for hours after the sun sets. SB
Energy will buy enough batteries over the next five years to power
50,000 American homes for a day.
“Long-duration energy storage, like this iron-flow battery, are key to
adding more renewables to the grid,” said Venkat Viswanathan, a
battery expert and associate professor of mechanical engineering at
Carnegie Mellon University.
ESS was founded
in 2011 by Craig
Evans, now president, and Julia Song, the chief technology
officer. They recognized that while lithium-ion batteries will play a
key role in electrification of transport, longer duration grid-scale
energy storage needed a different battery. That’s because while the
price of lithium-ion batteries has declined 90% over the last decade,
their ingredients, which sometimes include expensive metals such as
cobalt and nickel, limit how low the price can fall.
The deal for 2 gigawatt-hours
of batteries is worth at least $300 million, according to ESS. Rich
Hossfeld, chief executive officer of SB Energy, said the genius of the
unitslies
in their simplicity.
Julia Song
Photographer: Tojo Andrianarivo/Bloomberg
“The battery is
made of iron salt and water,” said Hossfeld. “Unlike lithium-ion
batteries, iron flow batteries are really cheap to manufacture.”
Every battery
has four components: two electrodes between which charged particles
shuffle as the battery is charged and discharged, electrolyte that
allows the particles to flow smoothly and a separator that prevents
the two electrodes from forming a short circuit.
Flow batteries,
however, look nothing like the battery inside smartphones or electric
cars. That’s because the electrolyte needs to be physically moved
using pumps as the battery charges or discharges. That makes these
batteries large, with ESS’s main product sold inside a shipping
container.
What they take
up in space, they can make up in cost. Lithium-ion batteries for
grid-scale storage can cost as much as $350 per kilowatt-hour. But ESS
says its battery could cost $200 per kWh or less by 2025.
Crucially,
adding storage capacity to cover longer interruptions at a solar or
wind plant may not require purchasing an entirely new battery. Flow
batteries require only extra electrolyte, which in ESS’s case can cost
as little as $20 per kilowatt hour.
“This is a big,
big deal,” said Eric Toone, science lead at Breakthrough Energy
Ventures, which has invested in ESS. “We’ve been talking about flow
batteries forever and ever and now it’s actually happening.”
A worker at
the ESS facility in Wilsonville, Ore.
Photographer: Tojo Andrianarivo/Bloomberg
The U.S.
National Aeronautics and Space Administration built a flow battery as
early as 1980.
Because these batteries used water, they presented a much safer option
for space applications than lithium-ion batteries developed around
that time, which were infamous for catching on fire. Hossfeld says
he’s been able to get permits for ESS batteries, even in
wildfire-prone California, that wouldn’t have been given to
lithium-ion versions.
Still, there was
a problem with iron flow batteries. During charging, the battery can
produce a small amount of hydrogen, which is a symptom of reactions
that, left unchecked, shorten the battery’s life. ESS’s main
innovation, said Song, was a way of keeping any hydrogen produced
within the system and thus hugely extending its life.
“As soon as you
close the loop on hydrogen, you suddenly turn a lab prototype into a
commercially viable battery option,” said Viswanathan. ESS’s iron-flow
battery can endure more than 20 years of daily use without losing much
performance, said Hossfeld.
Plastic sheets
are treated with plasma at the ESS manufacturing facility in
Wilsonville, Ore.
Photographer: Tojo Andrianarivo/Bloomberg
At the company’s
factory near Portland, yellow robots cover plastic sheets with
chemicals and glue them together to form the battery cores. Inside the
shipping containers, vats full of electrolyte feed into each electrode
through pumps — allowing the battery to do its job of absorbing
renewable power when the sun shines and releasing it when it gets
dark.
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It’s a promising
first step. ESS’s battery is a cheap solution that can currently
provide about 12 hours of storage, but utilities will eventually need
batteries that can last much longer as more renewables are added to
the grid. Earlier this month, for example, the lack of storage
contributed to a record spike in power prices across the U.K. when
wind speeds remained low for weeks. Startups such as Form Energy Inc.
are also using iron, an abundant and cheap material, to build newer
forms of batteries that could beat ESS on price.
So far, ESS has
commercially deployed 8 megawatt-hours of iron flow batteries. Last
week, after a six-month evaluation, Spanish utility Enel Green Power
SpA signed a single deal for ESS to build an equivalent amount. SB
Energy’s Hossfeld, who also sits on ESS’s board, said the company
would likely buy still more battery capacity from ESS in the next five
years.
Even as its
order books fill up, ESS faces a challenging road ahead. Bringing new
batteries to market is notoriously difficult and the sector is
littered with failed startups. Crucially, lithium-ion technology got a
head start and customers are more familiar with its pros and cons. ESS
will have to prove that its batteries can meet the rigorous demands of
power plant operators.
The new order
should help ESS as it looks to go public within weeks through a
special-purpose acquisition company at a valuation of $1.07 billion.
The listing will net the company $465 million, which it plans to use
to scale up its operations.
