The Rising Influence of Rising Affluence

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Bill Gates-backed ESS — which makes giant batteries out of iron, salt and water — starts trading

https://www.cnbc.com/2021/10/11/ess-battery-company-backed-by-bill-gates-softbank-opens-on-nyse.html

The company is backed by Breakthrough Energy Ventures, Gates’ clean energy investment firm; SB Energy, a wholly owned subsidiary of SoftBank; and multinational chemical company BASF, among other investors. The SPAC comes through a reverse merger with ACON S2 Acquisition Corp., run out of private equity firm Acon Investments.

ESS has not recorded any revenue yet, according to financial filings dated Sept. 8. However, Dresselhuys said it has shipped product to customers, including TerraSol Energies in Pennsylvania and Siemens-Gamesa in Denmark; investor documents also claim several other unnamed utilities as customers. ESS has orders in the pipeline from SB Energy and Enel Green Power Espana.

The company lost $245.3 million in the first six months of 2021, but operating losses were only $18.4 million; the remainder was due to losses on reevaluations of warrant and derivative liabilities. Operating losses were $17.4 million for 2021, and the company expects to record its first profit in 2023.

Iron, salt and water: Safe, readily available materials
The big breakthrough for ESS is a long-duration iron flow battery built from readily available materials, said Carmichael Roberts, a co-chair of the investment committee at Breakthrough Energy Ventures.

In a battery, the electrolyte is the chemical medium that connects the two ends of a battery, the anode and the cathode. In ESS’ batteries, the electrolyte is made of iron, salt and water.

“The flow battery is cheaper, safer and has better operational life than conventional lithium-ion storage,” Roberts said.

Making a battery out of iron, salt and water means “there’s no toxicity, the technology we build doesn’t start fires or doesn’t blow up in fire,” said Dresselhuys.