Forget Batteries, Store Energy in Concrete Blocks

Much progress has been made in recent years with solar and wind technology.  Costs have dropped dramatically for both these two renewable energy sources, bringing them within striking distance of economically competitive electric power sources.  The levelized cost of photovoltaic solar power is now near $0.07 per kilowatt hour and on-shore wind power about $0.05.  This compares to conventional gas-powered plants near $0.05 per kwh and coal near $0.12. 

Yet there remains one niggling problem  -  intermittent power production.  Gas, coal and nuclear proponents like to snicker and jeer, calling solar and wind by the energy industry pejorative, “non-dispatchable.”  Nighttime rolls around and winds die down, solar and wind power generation come to a halt.  These sources cannot be counted on to supply the consistent power supply required to keep the electric grid working properly.

To solve this problem, wind and solar power developers have leveraged battery technology and various smart grid solutions that smooth the flow of electricity into the grid.  Unfortunately, grid-scale batteries are expensive and the more affordable pumped hydroelectric storage is not available in many regions. 

Engineers at Energy Vault, SA, a privately held developer in Switzerland, think the solution is to be found in low-tech blocks.  The company has configured a set of blocks about the size of an oil barrel that can be elevated with a crane and pulley system into a tall column when power is generated.  From its lofty perch each barrel represents stored energy.  When needed the barrel can be returned to the base, driving energy into the grid with its move back down.  The physics behind the Energy Vault is very much like pumped hydroelectric energy storage.

When fully constructed the Energy Vault is colossal in size even if a low tech, low cost solution.  It extends about 33 stories into the sky and is topped by six crane arms assembled like a giant daisy with a span nearly the length of a football field.  Down below 5,000 blocks await deployment up the column. 

Another vital component in the Energy Vault is the software program that automates the process of raising and lowering the blocks.  An algorithm in the software system directs a crane to locate a block and lift it into place in the column.  When there is excess energy, it is used to move a pulley to lift a block.  Elevated against gravity, energy is stored in the block.  When energy is needed the same system directs the crane to direct the block back to the stack the base.  This time gravitation pull brings the block down and generates electricity.  Each round trip of a barrel is about 90% efficient.

The Energy Vault system has a capacity to store up to 20 megawatts hours.  It can be located near remote solar or wind power generation systems.  Cost of construction is estimated to be in a range of $7 million to $8 million.  Made from waste material and concrete, the blocks are low-tech.  However, the sheer number of them means the blocks will end up being that most significant cost for each system. 

The cost of the Energy Vault compares to the typical grid-scale wind tower and turbine costs in a range of $1.3 million to $2.2 million per megawatt.  Thus an Energy Vault could be justified against the cost of an on-shore wind farm, especially if the storage feature could entice a lucrative off-take agreement from an electricity buyer.

The Energy Vault is a novel approach to a serious problem.  The company has been funded by an equally novel source, technology incubator IdeaLab.  Energy Vault is one of twenty-nine companies in IdeaLab’s current portfolio.

Energy Vault is not dependent upon IdeaLab alone.  The company has partnered with CEMEX Research Group AG, a subsidiary of one of the largest cement producers in the world.  The due will be working on materials applications with the idea of optimizing of concrete and other composite materials. They will also focus on carbon reduction.

Energy Vault’s current circle of friends suggests the company probably can secure sufficient capital to test and perfect a demonstration system.  The test for the company’s scientists will be to gain market acceptance of a solution so very different from conventional systems.  While not an investment opportunity today, it is certainly worthwhile for investors to know that massive batteries are not the only storage option for renewable energy systems.

Neither the author of the Small Cap Strategist web log, Crystal Equity Research nor its affiliates have a beneficial interest in the companies mentioned herein.