Climateer Investing: Gates, Pritzkers vs. Musk: "The $5 Billion Race to Build a Better Battery" (TSLA)

Wednesday, April 15, 2015

Gates, Pritzkers vs. Musk: "The $5 Billion Race to Build a Better Battery" (TSLA)

We've been tracking the progress of the science for a couple decades now and can report, from hard won experience, there ain't no Moore's Law for batteries.
From Bloomberg:

Young companies staked by big backers are challenging fossil fuels with new ways to hold sun and wind power in the $50 billion energy storage market.

Professor Donald Sadoway remembers chuckling at an e-mail in August 2009 from a woman claiming to represent Bill Gates. The world’s richest man had taken Sadoway’s Introduction to Solid State Chemistry online, the message explained. Gates wondered if he could meet the guy teaching the popular MIT course the next time the billionaire was in the Boston area, Bloomberg Markets magazine will report in its May issue. “I thought it was a student prank,” says Sadoway, who’s spent more than a decade melting metals in search of a cheap, long-life battery that might wean the world off dirty energy. He’d almost forgotten the note when Gates’s assistant wrote again to plead for a response.

A month later, Gates and Sadoway were swapping ideas on curbing climate change in the chemist’s second-story office on the Massachusetts Institute of Technology campus. They discussed progress on batteries to help solar and wind compete with fossil fuels. Gates said to call when Sadoway was ready to start a company. “He agreed to be an angel investor,” Sadoway says. “It would have been tough without that support.”

Sadoway is ready. He and a handful of scientists with young companies and big backers say they have a shot at solving a vexing problem: how to store and deliver power around the clock so sustainable energies can become viable alternatives to fossil fuels. How these storage projects are allowing utility power customers to defect from the grid is one of the topics for debate this week at the Bloomberg New Energy Finance conference in New York. Today’s nickel-cadmium and lithium-ion offerings aren’t up to the task. They can’t run a home for more than a few hours or most cars for more than 100 miles (160 kilometers). At about $400 per kilowatt-hour, they’re double the price analysts say will unleash widespread green power. “Developing a storage system beyond lithium-ion is critical to unlocking the value of electric vehicles and renewable energy,” says Andrew Chung, a partner at Menlo Park, California–based venture capital firm Khosla Ventures.

The timing for inventors—and investors—may finally be right. Wind turbines accounted for 45 percent of new U.S. power production last year, while solar made up 34 percent of fresh capacity worldwide. Storing this energy when the sun isn’t shining or a breeze isn’t blowing has remained an expensive hurdle. Battery believers say that’s changing. They’ve invested more than $5 billion in the past decade, racing to get technologies to market. They’re betting new batteries can hold enough clean energy to run a car, home, or campus; store power from wind or solar farms; and make dirty electricity grids greener by replacing generators and reducing the need for more fossil fuel plants. This market for storage capacity will increase almost 10-fold in three years to 2,400 megawatts, equal to six natural gas turbines, Navigant Consulting says.

Gates made good on his pledge to Sadoway with an undisclosed investment in 2011. The money helped form Ambri, a nod to the company’s roots in Cambridge, Massachusetts. (Gates declined to comment for this story.) Billionaire Nick Pritzker and his son Joby are backing Pittsburgh-based Aquion Energy through their Prelude Ventures and Tao Invest funds. At Aquion, a Carnegie Mellon University professor is repurposing a factory that made Volkswagens and Sony TVs to fashion batteries for residences and hotels. Technology from California’s Lawrence Berkeley National Laboratory has support from VC Vinod Khosla. The top three U.S. automakers are testing the lab’s lithium polymer product, which powers cars and homes. Sales are expected next year....MORE

http://krisdedecker.typepad.com/.a/6a00e0099229e88833013480522e53970c-pi

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