The Power of Pineapple
“…Pineapple Power offers investors an opportunity to get ahead of the curve through exposure to an emerging technology that will be fundamental to the energy transition…”
With his promise to make Britain the ‘Saudi Arabia of wind energy’ earlier this month Boris Johnson briefly diverted attention from the ongoing pandemic with characteristic rhetorical flourish. ‘Your kettle,’ he told the Conservative Party conference, ‘your washing machine, your cooker, your heating, your plug-in electric vehicle: the whole lot of them will get their juice cleanly and without guilt from the breezes that blow around these islands.’
The Prime Minister’s enthusiasm for wind inspired some unfortunate media commentary, but the speech was significant, anticipating a white paper expected before the end of the year that will detail the Government’s multi-billion energy transition programme, intended as a major step towards meeting Britain’s commitment to Net Zero carbon emissions by 2050, and to provide a long-term post-pandemic economic stimulus.
Wind, solar, hydrogen, electric vehicles – and batteries
The programme is likely to invest in the full spectrum of renewables technologies, including wind, solar, hydrogen and electric vehicles. One British start-up, Pineapple Power Corporation, profiled in TMS last month, is hoping there will also be support for a critical but as yet unheralded component of a future green infrastructure: battery storage.
Pineapple is a proposed new Special Purpose Acquisition Company (SPAC) raising money to list on the Main Market of the London Stock Exchange – a SPAC is an enterprise that joins the markets with nothing but cash and the aspiration to acquire one or more private companies – with the aim of acquiring at least one suitable venture in the emergent battery flow space. Flow batteries play the crucial role of storing the energy produced by intermittent renewable power sources like power and wind, allowing it to be released as needed into the grid.
Johnson’s speech signposted the possible scope of the white paper, promising to increase the government’s existing 2030 target for offshore power generation from 30 gigawatts to 40 gigawatts. To put that in perspective, with 10 gigawatts currently installed Britain is already the world’s largest user of offshore wind power. Increasing capacity to 40 gigawatts would require about £50 billion in capital investment according to the Aurora Energy Research think tank.
The Prime Minister also referred to ambitions to invest in the next generation of floating wind turbine installations (moored to the seafloor with cables suitable for deep ocean waters), hydrogen-fuelled trucks, trains and aircraft, road networks optimised for electric vehicles, the retrofitting of homes, carbon capture and storage technology, and small modular reactors – small nuclear generators that can be rolled out more easily and cheaply than large nuclear reactors.
Downing Street officials have indicated that plans to borrow £100 billion over the next five years for capital spending are likely to be rebadged as a ‘clean energy and infrastructure growth package’. If so Britain would be following in the footsteps of France and Germany, which earlier this year announced green investment programmes together worth some €70 billion.
More renewables means more batteries
A credible commitment to renewables implies commitment to flow batteries. Solar and wind are finally beginning to make significant contributions to the grid as their price falls. But they depend on the weather: during this year’s summer heatwave, for example, the UK went from sourcing 20 per cent of its energy from wind to just 4 per cent. Gas turbines have been necessary to provide reliable backup power.
Flow batteries offer the revolutionary promise of electricity grids powered wholly through non-carbon energy sources, allowing surplus power generated by solar and wind to be stored when the sun is shining and the wind blowing, and released when the clouds roll over and the air is still. They work by storing energy in tanks of liquid electrolyte – usually derived from the metal vanadium – which is then pumped through a stack of cells, causing an electrochemical reaction that generates electricity.
The batteries have a very long life, able to perform reliably for at least 30 years – vanadium electrolyte can reliably charge and discharge for thousands of cycles without degrading – meaning they can be relied on to store sufficient reserves of energy to keep power grids running through shifting patterns of demand. They can also provide the backbone for standalone energy systems in regions or countries with poorly developed energy infrastructures. In Africa for example flow batteries hooked up to solar panels are already helping provide green power for communities and factories without access to a grid.
It all makes for a huge potential market, here in the UK and globally. As the technology improves the price of flow batteries is falling – according to Wood Mackenzie costs fall some 5 to 8 per cent every time battery production doubles. A report from Markets and Markets predicts that the value of the flow battery market, less than $200m in 2017, could touch $1 billion by 2023, a compound annual growth rate of more than 30 per cent.
A growing market
Flow battery technology is here, but their mainstream adoption will depend on continued investment in renewables and securing reliable supply chains for vanadium. Here in the UK their potential is gradually being recognised. This June the Government passed secondary legislation making it easier for companies to create new energy storage projects off the ground, allowing them to apply for planning permission through local planning authorities rather than the labyrinthine national planning system.
And Britain’s first major battery storage programme is well underway. The Energy Superhub Oxford project draws on a range of renewables technologies to integrate green infrastructures into urban environments: electric vehicle charging, low carbon heating, and smart energy management systems. The network depends on a 50 megawatt ‘hybrid’ Lithium-ion/vanadium flow battery system, located in the National Grid’s Cowley Substation, regulating the supply of power according to demand, and ensuring, for example, its availability for the overnight charging of electric vehicles. The installation is one of several major global battery flow projects, the largest of which is the 800 megawatt storage facility under construction in Dalian, China.
In additional investment the mass rollout of vanadium technology depends on the establishment of secure supply chains. Some two-thirds of vanadium is derived from steel slag mainly sourced in China. But primary production now accounts for around a fifth of total supply, with Bushveld Minerals, Glencore and Largo Resources all owning significant mines.
Continued investment in renewables means continued investment in battery storage. Pineapple Power is well positioned to benefit. Pineapple says it expects to raise some £500,000 to £1m prior to listing, and £2m through the issue of shares priced at £0.03.
Solar and wind get the headlines, but a comprehensive green infrastructure needs battery power. Pineapple Power offers investors an opportunity to get ahead of the curve through exposure to an emerging technology that will be fundamental to the energy transition. Shares in Pineapple are available from a number of City of London brokers, including Axis Capital Markets and Peterhouse Capital.
Over the past decade, prices for solar panels and wind farms have reached all-time lows. However, the price for lithium ion batteries, the leading energy storage technology, has remained too high. So researchers are exploring other alternatives, including flow batteries, thermal batteries, and gravity-based systems. The short CNBC video below explains a little more about the different solutions and opportunities moving forward into the future…
The author was paid for this article but does not hold any shares in the above company.