EnerVenue: The Batteries We Need for Grid-Scale Storage
By: Erik Kobayashi-Solomon
Tags: Investing, Renewable Energy, Battery, Climate Change

As I mentioned in my Grid Modernization article, our electrical system was originally designed to supply instantaneous power with essentially zero storage capacity.*

A structural inability to store power represents a critical bottleneck in the process of building a low-carbon electrical system. Renewable resources like wind and solar are naturally intermittent, and no one wants their fridge to stop working when the wind dies down.

Entrepreneurs read the word “bottleneck” as “opportunity,” so a lot of smart materials scientists have been working hard to leverage the leading battery technology — lithium-ion — to rehab our Industrial Revolution-paradigm grid with 21st century storage capacity.

Lithium-ion batteries have represented an inexorable force in the technology world — especially in the field of mobile computing — over the last 30 years for several reasons:

Lithium is the lightest solid element and the lightest metal, so lithium-ion batteries are lightweight. This makes them great for mobile computing and transportation.

Lithium-ion batteries have a high energy density — which means you can pack a large charge in a relatively small package. Again, that makes them great for mobile computing and transportation.

Lithium-ion batteries tend to be quick charging. This again makes them good for mobile devices as the mobile devices need not be connected to a plug for that many minutes in a day.

However, as wonderful as lithium-ion batteries are, they have their weaknesses as well:

They are sensitive to temperature extremes and must be cooled or they run the risk of “thermal runaway”.

They tend to be persnickety — their discharge and recharge cycles must be carefully managed, they lose charging capacity over time, and their functional lives tend to be short (3,000 recharge cycles at most), even when you baby them.

The price has come down considerably over the last 10 years, but they are still expensive — running between $300-$1,000 per kilowatt hour (for grid storage and home storage devices, respectively).

In short, lithium-ion is a Thoroughbred technology — fast, sleek, and powerful, but temperamental, sensitive, and pricy. For the backbone of our fixed electrical infrastructure, surely we need a technology more like a Clydesdale — sturdy, dependable, and modestly priced.

One start-up — a California firm named EnerVenue — has hit upon a sturdy, dependable, and modestly-priced solution to the grid’s storage issues.

Team EnerVenue — solving the issues of grid storage in the age of COVID-19. Source: Enervenue.com

EnerVenue’s batteries are based on a technology that has powered earth-orbiting satellites since the 1980s — Nickel-Hydrogen chemistry — but have not been able to be used for terrestrial grid storage due to their high cost.

Professor Yi Cui, Stanford University. Source: EnerVenue.com

The company’s founder, Chairman, and Chief Technical Officer, Professor Yi Cui of Stanford University, has discovered a way to substitute a cheap and plentiful metal alloy for the pricy Platinum that had been used in the space satellite batteries.

The result of Professor Cui’s research is a battery whose basic chemistry is well-understood and thoroughly tested in the most challenging of environments and which is cheap and dependable enough to form the backbone of a modern grid-scale storage system.

One look at the technical characteristics of EnerVenue’s Metal-Hydrogen batteries should excite your curiosity as much as they have mine. They…

Can operate in a temperature range from -40°F (-40°C) to 140°F (60°C).

Have a 30+ year lifespan, and are capable of 30,000+ full recharge cycles without performance degradation or usage restrictions.

Use Low-cost, non-toxic, and easy-to-recycle components.

Require no operational and maintenance expenditures.

The downside? Well, let’s just say you wouldn’t want to lug around a mobile phone powered by one of EnerVenue’s beauties.

EnerVenue’s Metal-Hydrogen batteries. These batteries solve a lot of the problems that have slowed down implementation of grid-scale storage until now. Source: EnerVenue.com

This is not to say that one battery technology is better or worse than another — simply that we should focus on using the right technology in the most fitting application. No one straps a cart to a $10 million Thoroughbred, just like no one runs a Clydesdale in the Kentucky Derby.

EnerVenue batteries’ wide temperature envelope means that they can be stacked en masse to store energy generated by a solar farm in the Mojave Desert just as easily as they will be able to store power from a frigid wind farm on the Baltic Sea.

Unlike lithium-ion installations which require operators to carefully monitory and manage recharge cycles, watching for signs of overcharging or dendrite formation, and designers to worry about how to insulate or cool the battery modules, EnerVenue’s batteries are essentially fire-and-forget.

Build the storage facility, lock the gates, and set a calendar appointment to come back in 30 years to swap out battery packs — energy storage doesn’t get much more straightforward than that.

In terms of the economics, EnerVenue’s management thinks that, at scale, their solution will store energy at a 40% lower cost than what lithium-ion can offer on a “levelized,” total-cost-of-ownership basis.

EnerVenue’s batteries sounds like just what we need for a long-term solution to grid-scale battery storage. Still, battery investments are notoriously prone to technology risk, and one question I tried to drill into when I spoke with management was — frankly — whether EnerVenue was some smart guy’s pet science fair project rather than being an actual, viable business.

Judging by the long operating history of batteries using the same chemistry in unforgiving environments, there is reason to believe that EnerVenue’s technology risks are small. Another good indicator that EnerVenue is the kind of company that may become a true force in the industry is the people involved.

Doug Kimmelman, famed utility and power systems investor, is one of EnerVenue’s early supporters. Source: Doug Kimmelman

The project is funded, in part, by Doug Kimmelman — the senior partner and founder of Energy Capital Partners, a $20 billion private investment fund that specializes in energy infrastructure. Kimmelman cut his teeth at Goldman Sachs as an investment banker in the utility and energy sector just as the deregulation of energy markets was beginning.

In short, Kimmelman is the smart money. He knows this world inside and out, understands what the industry needs, and has decided to invest his own money in EnerVenue. He has seen a lot of science fair experiments and understands how to separate the wheat from the chaff. The fact that he is backing EnerVenue is a big mark of confidence.

Jorg Heinemann, CEO of EnerVenue, has spent the last 10 years as an executive in the renewable energy and battery storage world. Source: EnerVenue.com

EnerVenue also hired a very capable CEO, Jorg Heinemann, who was an executive director at technology consultancy, Accenture , before moving into an executive role at SunPower , then to a role as Chief Commercial Officer of Primus Power, a manufacturer of another type of storage device known as a flow battery.

EnerVenue will build 2 megawatts worth of customer pilot facilities in 2021, with a plan to increase their footprint by 20x over that level in 2022.

For a country talking about electrifying the transportation sector, we should all be hoping that EnerVenue’s plans to scale come to fruition. There is simply no way to maintain our accustomed standard of living and simultaneously cut our transportation-related CO2 footprint without a continued rapid growth of zero-carbon and renewable generation facilities and an even more rapid growth of storage capacity.

Looking for the next big wave? Energy storage is it. EnerVenue sees a total available market globally totaling $660 billion by 2040. This observer would not be surprised if that turns out to be a conservative estimate.

The leaders at EnerVenue know, as I know, that we must change the paradigm with which we are operating if our civilization is to thrive into the next century. Intelligent investors take note.