A secretive Swiss battery maker threw the cloak off technology Tuesday that it promises will transform the energy industry and employ up to 500 workers within a year.
The privately held Alevo Group will make its manufacturing base in the cavernous space that cigarette maker Philip Morris USA vacated in 2009. Alevo paid $68.5 million for the 2,000-acre campus in April and renamed it Victory Industrial Park.
Alevo joins a swarm of competitors chasing a holy grail of the industry: how to store energy, which now has to be consumed as it is generated. The question has taken on greater urgency as solar and wind power, with their on-and-off nature, generate increasing amounts of energy.
In Concord, the company will make storage modules, called GridBanks, that fit in 40-foot shipping containers. Inside will be lithium-ion battery technology it has developed, under cover in Germany, over a decade.
Alevo says it will sell a service, not just a product. By combining the modules with analysis of how best to deploy them, Alevo says it can help utilities recapture the 30 percent of energy it says is wasted.
“The GridBank is really an active shock absorber,” able to soak up excess energy and release it when needed, said President Jean-Claude Beney. “The analytics help schedule and anticipate what we can deliver.”
Gov. Pat McCrory and Commerce Secretary Sharon Decker appeared at a four-hour unveiling of the company Tuesday. Tours by golf cart quietly zoomed through empty manufacturing halls, inside a 2.3million-square-foot building, big enough to house 1,000-foot assembly lines.
“It may be the biggest economic development announcement since Philip Morris was announced,” said Concord Mayor Scott Padgett, who first met with potential investors in the plant five years ago. Philip Morris once employed 2,500 workers at the site.
No state incentives
Alevo, based in Martigny, Switzerland, was founded by Norwegian-born entrepreneur Jostein Eikeland and is owned by private equity firms.
Alevo says it is so sure of success that it didn’t seek state or local incentives – confirmed by state and local officials – to move its manufacturing base to Concord.
The company predicts it will employ 2,500 within three years and could ultimately reach 6,000, and expects to spend $350 million to upfit the manufacturing space. It did not estimate median wages but said first-year hires will range from engineers to warehouse workers.
Production is expected to start in April, with the first products shipped in July. They will be marketed first in China and Turkey under agreements Alevo announced Tuesday.
The cost of storing energy will be key as utilities juggle power generated by many sources, including renewables, said Johan Enslin, director of UNC Charlotte’s Energy Production & Infrastructure Center.
Strategically used, he said, storage capability also could reduce the hours that aging, expensive-to-run power plants are operated.
“The issue would be, can they make it at a price point that is affordable to utilities?” Enslin said. “Without reliable storage, we can’t do a lot more on renewables.”
The Electric Power Research Institute is an industry group that typically evaluates new technologies – but not Alevo’s.
“Most companies are pretty eager to share their technology with us, and certainly a lot of technologies we work with are not ready for prime time,” said Haresh Kamath, who manages EPRI’s energy storage program. “With Alevo, we have not had that chance.”
The company has not refused to share its work, Kamath said, but EPRI hasn’t been able to reach it since it learned of the technology a couple of weeks ago. Based on what he’s heard, Kamath called it “certainly very promising in terms of cycle life, and we’d love to see it and verify that.”
Energy executives report a growing dread within the industry that utilities face a “death spiral” as renewable energy and growing demands from choice-conscious customers erode their business model.
Storage technology, coupled with other strategies to smooth out the peaks and valleys of energy demand, could come to the rescue, some experts say.
In talks with Duke
Duke Energy, which is evaluating a half-dozen types of battery technology as it expands its wind and solar fleets, said it plans to meet soon with Alevo to learn more.
“It’s a matter of, does it work, and will it work in a real-life Duke Energy situation?” said spokesman Randy Wheeless. “A lot of it gets down to money – how much will these things cost? If they can store energy at a (fossil-fueled) peaking plant, what is that worth?”
While the battery field is crowded with competitors, Alevo says its innovation is a sulfur-based electrolyte that is not combustible and doesn’t release harmful gases.
Accenture, a global management consulting and technology services firm, analyzed the technology and concluded its thermal stability and combustion “may represent a breakthrough” in grid-scale storage.
The battery modules can also be charged and discharged tens of thousands of times, Alevo says, giving them unusually long life. The technology can be suited to a wide variety of power generators, from fossil-fired plants to solar or wind, the company says.
It projects annual production of 480 storage modules by the end of 2015 and expects to make 16,000 units a year within five years.
“There is no question mark,” said Beney, the company president. The challenge, he predicted, will not be in sustaining rapid growth but in keeping up with it.