Transcript Eos Energy Storage

Eos Energy Storage
CREA Energy Innovations Summit | Denver, CO
Philippe Bouchard, VP of Business Development
Today’s Electricity Grid is Massively Overbuilt &
Under Utilized…
G
eneration
T
ransmission
D
istribution
# in U.S.
17,350 plants
Utilization
47%
43%
34%
Projected spend
2010-2030
$505B
$298B
$582B
Projected
underutilization
164,000 miles 3 million miles
~$822B of future US infrastructure will be
underutilized without storage
Ratepayers fund hundreds of $Bs of infrastructure to serve peak demand
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Sources: “Electric Power System Asset Optimization.” NETL, March 2011; “The Power of Five Percent.” The Brattle Group, May 2007
2
Regional Spending on T&D Projects Completed by
2020 Heavily Weighted Towards the Rockies
~66% of projected infrastructure spend
through 2030 is distribution system upgrades
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Sources: “Electric Power System Asset Optimization.” NETL, March 2011; “The Power of Five Percent.” The Brattle Group, May 2007
3
Significant growth in energy storage industry
has already begun
Energy storage market to reach ~$25B by 2022
Battery Energy storage market projection
(GW)
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14
Behind the meter
In the Grid
Co-located (renewables)
Co-located (conventional)
($B)
25
2013 RFPs outstrip previously installed capacity
2013 energy storage announced RFPs exceed total current
global installed non-hydro storage capacity (MW)
2500
2013 represents
a~$4B market
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12
Japan
Europe
2000
California
10
15
1500
10
1000
8
6
4
5
500
Long Island
US
PR
2
0
0
0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
SoCal Edison
Italy
2013 RFPs
Currently installed
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Source: IHS “The Grid connected energy storage market” 2014 DOE Storage Database; Press searches
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Eos Aurora Designed Specifically to Meet Market
Requirements for Grid-Scale Storage
Eos Aurora 1000|4000
v
Grid-Scale Energy Storage
Eos ZnythTM
Sub-Module
DC battery performance attributes
Low cost / kWh
$160/kWh
Long life (high # of cycles)
10,000 cycles
(30 years)
Energy density
6MWh in a 40ft
container
High energy efficiency
75% round trip
efficiency
Safety
Non-hazardous,
non-combustible
Eos Aurora optimized to meet customer requirements and to provide lowest LCOE
confidential
5
Levelized cost of energy is critical metric for adoption;
Eos LCOE lower than incumbents and competitors
EOS
Eos outcompetes gas peaking turbines on an LCOE basis
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Eos Partnering with Major Utilities on Business Case
Driven Product Development & Demonstration
Optimize
Demonstrate
Deploy
Eos Genesis collaboration includes:
1. Detailed business case analysis to identify
profitable opportunities for deployment
2. Testing and evaluation of Eos’ novel
ZnythTM battery technology leveraging
partner facilities and testing platforms
3. Pilot demonstration of Eos Aurora
systems to understand real-world costs
and to optimize value streams
Together Eos’ Genesis Partners represent:
Customers
GW Generation
Miles of T&D
Countries
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Powerful Business Cases for Storage
MW-Scale
Grid-Connected
1
Behind-themeter Storage
2
• Generation capacity
• Time of Use (TOU) energy
management
• Transmission or distribution deferral
• Demand charge reduction
• Ancillary services
• $2.1/W locational capacity program
• Renewables integration premiums
• Permanent Demand Reduction
• Electricity peak shifting (arbitrage)
• Demand response program
participation
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Example: Grid-Connected ‘Triple Play’
Example Financials: 5 MW Eos Installation
Cost
• Installed capital cost of ~$1,970 per kW
• Annual operating cost = $200,000 per yr
~$10.1 M
Gross
Revenues
(Avg Annual)
TOTAL per MW (10 yr period, ~70% RTE)
1. Average Energy Arb
$ / MWh
2. Gen Capacity
$ / kW – year
3. T&D Value
$ / kW – year
~$2.7 M / yr
Financing assumptions: 75% debt @ 8.0%, 10 yr
IRR
Equity
Payback
All Equity
Leverage
23%
56%
• Total of outlay + any negative cash
flows
$10 M
$2.5 M
• After tax, 10% discount rate
4 years
2 years
• After tax, residual value
Eos installation creates 56% IRR and 2-year payback
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Example: 50MVA Substation Deferral
Energy storage can be used on a targeted basis
to provide locational capacity and to defer
costly T&D upgrades, improving reliability and
lowering costs for the utility / ratepayer
A•
T&D upgrade
performed as usual;
upfront Y1 spend
B•
Storage installed Y1
utility-owned,
5-year T&D deferral
•C
Storage installed Y1,
10-year contract (developer
monetizes market revenues)
NPV: ($10.5M)
NPV: ($10.5M)
NPV: ($6.9M)
+ $10.3M addition to rate base
+ $16.1M addition to rate base
+$10.3M addition to rate base in Y5
confidential
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Example Peak Load Shaving Battery / Load Profile
Example: Behind-the-Meter ‘Triple Play’
Example Financials: 100 kW Eos Install
Cost
Gross
Revenues
(Avg Annual)
• Installed capital cost
• Operating cost = ~$5,000/yr
$310,000
Assumes 10 yr period, ~70% RTE
1. Average Energy Arb ($/kWh)
2. ↓Demand charge ($/kW-month)
3. Targeted DSM ($/kW installed)
$75,000
Financing assumptions: 50% debt @ 10%, 10 yr
IRR
100 kW Project Concept Design
• After tax, residual value
All Equity Leverage
23%
44%
Equity
• Total of initial outlay + any
negative cash flows
$310 K
$166 K
Payback
• After tax, 10% discount rate
4 yrs
2 yrs
Eos low-cost, energy dense, and safe battery
flattens customer load while increasing resilience
Images and financial projections provided courtesy of Convergent Energy + Power
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Behind-the-Meter Business Case
July 2010
Without Battery
With Battery
1
2
3
Hours
4
5
6
7
8
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
10,000
Max kW
9,000
Demand Charge
Reduction
8,000
7,000
2 Hour “Demand Response” Call
6,000
Balance charge / discharge profile
to reduce the monthly peak
without creating a new one
5,000
4,000
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What We’re Hearing from the Solar Industry
First Solar CEO, Jim Hughes:
* Market cannot respond to falling
solar prices because of structural limits:
✴ Transmission capacity constraints
✴ Grid stability issues
✴ Load shape and growth
✴ Utility resource planning cycles
* The key to long term growth is to
solve for these constraints.
* Price alone won’t do it…
Critical question: What is the sustainable
business model and where does storage fit in?
cleantechsummit.com
1) Jim Hughes, First Solar. Tomorrow’s Utility: The View from the Sun. CleanTech Investor Summit. Feb 2013.
http://cleantechsummit.com/resources-2/
Eos continues to make strong progress and will
deliver first systems to Genesis partners in Q4 2014
Q2 2013
Q3 2013
2kW Modules
Internal Testing
Feb 2013
Manufacturable
Sub-Module Design
Q3 2013
Q4 2013
Q1 2014
Q2 2014
AC-Integrated
System Q4 2013
3rd Party
Testing &
Validation
Q2 2014
Q3 2014
Q4 2014
2015…
Planned Pilot Projects
GDF Suez
Con Ed
Q4 2014
Q4 2014
Commence
MW Genesis
Production
2014 Focus: Demonstrate kW-scale, test and optimize AC-integrated systems with
Genesis partners, ramp up manufacturing
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Eos to Announce 2016 Commercial Product
Offering and Aegis Program
In December, Eos plans to announce availability of its 2016 & 2017 commercial product
(DC battery), also offered with full AC integration via Eos’ new Aegis Program
COMMERCIAL PRODUCT
AEGIS PROGRAM
• Firm delivery of 1MW/4MWh systems
available at $300/kWh for 2016 install and
$160/kWh for 2017 install
•
• 1 year standard warranty;
up to 5 yr warranty at
additional cost
Aurora 1000 | 4000
(DC battery system)
Establishes formal
relationships with system
integrators to provide ACintegrated, turn-key
systems via multiple
distribution channels
•
Aegis partners can provide warranty wrap and
option for extended performance guarantee
•
Aegis partners to be announced in near future
2015 demonstration partners will have priority access to 2016 volume
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