Xtreme Power raises cash for renewable-energy storage
Start-up pulls in nearly $30 million to go after the utility market with large-scale systems that make wind and solar power more reliable suppliers of electricity to the grid.
Xtreme Power, which is commercializing battery technology originally developed for electric vehicles, is expected to announce on Tuesday that it has raised nearly $30 million to expand into utility energy storage.
The Austin, Texas-based company brought in venture-capital firm Bessemer Venture Partners as an investor, as well as potential partners and customers including Dow Chemical, BP, utility Dominion Power, and an energy project developer. The money will be used for further product development and working capital to develop storage projects, said CEO Carlos Coe.
The technology behind Xtreme Power was originally developed in the 1990s for use in hybrid and electric . It's a dry cell battery that uses a "non exotic metals" such as lithium or nickel, said Coe, who declined to be more specific about what's inside the batteries.
The battery chemistry is well-suited for utility-size storage because it can store large amounts of energy and deliver large amounts of power, he said.
One of its battery systems is beingto maintain a steady flow of electricity from a wind farm. In that case, the batteries will be capable of delivering 30 megawatts of power and have 10 megawatt-hours of storage.
"The advantage of the system with renewable energy is that it addresses one of the key issues, which is variability," said Coe.
In addition to building storage to make solar and wind power more steady, the company is also going after the market for "grid services." Right now, grid operators have natural gas plants standing by to ensure that there's a balance between supply and demand and that there's also steady frequency and voltage.
Coe said that a storage system costs about the same as a natural gas plant but that the operation is much cheaper. But current utility regulations are not designed for storage, making it difficult to sell large-scale storage.
Cost of storage is another barrier. There are a host of technologies competing, including batteries and compressed air stored underground, but the cheapest is pumped hydro, in which water is pumped uphill at night and released during times of high demand during the day.