CLARE — A mid-Michigan energy storage manufacturer is raising $50 million in capital to scale up production of its lead-acid battery technology, which executives say will be crucial to accompany growing amounts of renewable energy generation on the grid.
Founder and CEO Edward Shaffer formed Clare-based Advanced Battery Concepts LLC in his garage in 2009. After scaling up from incubator space in Midland to a production facility in Clare, Shaffer is preparing for the company’s next phase of commercialization and larger scale production.
Shaffer envisions ABC’s EverGreenSeal lead-acid battery technology, which is housed inside its BOX-BE bay, as a competitor for the likes of Tesla’s Megapack, which offers long-duration, stationary energy storage options in commercial, industrial and utility-scale settings.
Shaffer says lead-acid batteries, a mature technology with lower materials costs compared to lithium-ion, are a cost-effective alternative with a more stable supply chain compared to other technologies. He said ABC’s lead batteries offer 30 to 40 percent cost savings compared to lithium-ion batteries. Tax credits under the federal Inflation Reduction Act promise additional cost savings, Shaffer added.
“We’ve reinvented the lead battery to improve performance and reduce cost,” Shaffer told MiBiz. “It’s a responsible energy storage solution for the grid that we need. By responsible, we mean first and foremost that it’s economically responsible.”
As of last month, ABC was selling its product to potential investors and customers. It is contracted for a large-scale storage project for an industrial customer in California that will use it to balance its load needs during periods of high electricity demand. Shaffer said the company has 1 gigawatt-hour of storage under letter of intent from multiple customers.
Meanwhile, the company has launched a $50 million Series C funding round for new equipment and working capital in support of a new production facility in Clare. The company is targeting traditional investment bankers, though Shaffer admitted the financing is “unfortunately taking longer than I’d like.”
ABC is seeking investors in an otherwise active venture capital environment for energy storage. Corporate funding into energy storage companies reached $22 billion across 92 deals in the first nine months of 2022, according to an October report from Austin, Texas-based Mercom Capital Group. That’s an increase from $13 billion across 74 deals during the same period in 2021.
Shaffer hopes the funding comes through to support a new operational facility sometime next year.
“We have orders and product, now we need to get product in the field,” Shaffer said, noting some demonstration projects planned for this year. “Then we’ll build a plant so in 2024 we can start building product and sell it all over the world.
“My goal is: I want Elon Musk to wake up one day and say, ‘Where the heck is Clare, Mich.?’”
While lithium-ion batteries are necessary for electric vehicles, Shaffer wants to target the electricity sector and present utilities with a cheaper option as they deploy more wind and solar to reduce the carbon footprint of their generation mix. Michigan’s two large investor-owned utilities, DTE Energy and Consumers Energy, have announced plans to deploy thousands of megawatts of solar and hundreds of megawatts of battery storage in the coming decades.
“From our perspective, energy storage is just as vital as electric vehicles for transitioning our country to a low-carbon producer,” Shaffer said.
The Michigan Energy Storage Roadmap produced for the state last year describes lead-acid battery storage as “mature technology that has the advantage of lower costs, but suffers from lower energy density and cycle life compared to lithium-ion batteries. These lead-acid batteries are typically bulkier and heavier than lithium-ion batteries….”
Shaffer added that lead-acid battery storage is “bad for cars — you wouldn’t want to use us in a Tesla electric vehicle. But for energy storage on the grid, no one cares how much you weigh.”
Shaffer also notes that the company’s BOX-BE product can be recycled at the end of its useful life by converting spent materials into starting materials.
According to the state’s Energy Storage Roadmap, 100 kilowatts of lead-acid battery storage capacity has been deployed in Michigan, just a fraction of the capacity deployed in states like Arizona and Hawaii.
Comparatively, 2,850 kilowatts of lithium-ion and 1,200 kilowatts of flywheel battery storage has been deployed in Michigan, according to the roadmap, which recommends a variety of short- and long-term policy solutions to help achieve escalating storage capacity targets.