NEC has big plans for energy storage

After buying A123 Energy Solutions, Takashi Ohara of NEC talks to Energy Storage Report about his company's plans for grid-scale, grid-edge and domestic battery energy storage in the USA, Europe, Asia and in developing economies, such as Africa and India.

After buying A123 Energy Solutions, Takashi Ohara of NEC talks to us about NEC’s plans for battery energy storage in the USA, Europe, Asia and developing economies like Africa and India.

When NEC announced it was going to pay USD$100m for A123 Energy Solutions, it was clear that the lithium-nanophosphate battery manufacturer was well and truly back after bankruptcy and a spell of developing its business under the ownership of Wanxiang. As well as cementing the future of A123 after a few tumultuous years, NEC’s purchase represents a huge investment in the future of energy storage. The giant Japanese multinational already uses batteries from AESC, its joint venture with Nissan. Similar to the units used in the Nissan Leaf, these battery storage systems have been used by NEC for both utility-scale storage – a 2MW system has recently been commissioned in Italy by Enel Distribuzione – and in the residential storage market in Japan. The company has also been using batteries from third-party suppliers in a trial with Acea in Rome.

The company’s interest in energy storage was made clear by Hideki Niwaya, vice president of NEC’s smart energy business unit, who told the Wall Street Journal that NEC expects global sales of energy storage systems to utilities to grow from less than $2bn in 2015 to about $6bn by 2020.

Takashi Ohara, executive specialist in the smart energy business unit at NEC, took some time out to talk to us in more depth about NEC’s plans in North America, Europe, Asia and developing economies for grid-scale, grid-edge and domestic energy storage.

Energy Storage Report: What are NEC’s plans for A123 batteries? Are prices likely to go down?
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Energy storage news: 26.03.14

In the wake of new lithium-ion battery storage subsidies in Japan, NEC has bought A123's grid energy storage unit. Photo credit: A123 Systems

In the wake of new the lithium-ion battery storage subsidies in Japan, NEC has bought A123’s grid energy storage unit. Photo credit: A123 Systems

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A123 unit goes Hawaii Live-O

A123 Long Duration grid storage system. Pic courtesy of A123 Systems

A123 Long Duration grid storage system. Pic courtesy of A123 Systems

A123 Energy Solutions yesterday announced the first commissioning of its Long Duration grid storage system in Hawaii for the Maui Electric Company (MECO). The energy storage installation can provide 1MW for up to one hour and will perform services to increase electric grid operational efficiency, stability and power quality.

Installed at an existing MECO substation, the 1MWh energy storage system was packaged in a 20-foot container and shipped to the site fully assembled and tested. A123 Energy Solutions provided the engineering, procurement, construction, installation and testing.

A key component of the Maui Smart Grid Project, the battery will provide peak-load shifting, voltage regulation, reactive power support and wind curtailment relief. “This installation is the second site we’ve commissioned on the island of Maui in the past five months,” said Bud Collins, President of A123 Energy Solutions.

“But while the 11MW commissioned in December of last year was comprised of our widely deployed High Rate systems, this is the first time we’ve commissioned the Long Duration product. We’re very happy with how smoothly the installation went. The entire process took about five weeks from start of construction up to the completion of commissioning.”

Wanxiang scoops up A123

Chinese auto giant Wanxiang has beaten US Johnson Controls, Japan’s NEC and German concern Siemens AG to scoop practically all of A123 Systems’ assets in what has become a controversial and politically charged contest.

According to A123’s press release, Wanxiang would acquire A123’s automotive, grid and commercial business assets, including all technology, products, customer contracts and US facilities in Michigan, Massachusetts and Missouri; its cathode powder manufacturing operations in China; and its equity interest in its joint venture with Shanghai Automotive.

Excluded from the asset purchase agreement with Wanxiang, which is worth USD$ 260 million, is A123’s government business, including all US military contracts, which would be acquired for $2.25 million by Navitas Systems.

Wanxiang had always said that it would forego these and it is hard to imagine that the sale to a large corporation in a competitor nation would have been politically feasible had they been included. Another bone of contention has been the many millions of US tax dollars that had been pumped into the ailing company over the years.

Politicians and commentators have been making plenty of hay over US-funded technology “heading east”. This could be a deciding factor when the sale is be approved (or blocked) by Delaware Bankruptcy Court at a hearing scheduled for today. Another is the fact that Wanxiang already generates about $1 billion of  revenue in the US.

Wanxiang in wrangles over A123 purchase

Now officially the longest running soap-opera in energy storage, the A123 saga is now attracting controversy from senior US politicians and even the military, says The Chicago Tribune. As regular readers will know, after a lot of near-disasters and false dawns, the advanced lithium-ion battery manufacturer finally went bankrupt a few weeks ago.

Since then, US-based Johnson Controls and the Chinese auto giant Wanxiang have been in the running to take over what is left of A123, including its intellectual property. And here is where the controversy starts. As A123 had been dealing with the US military, there is some fear that strategic information might be shared with a company from what might be called a competitor nation.

What is more, the technology that A123 was developing was done so with the aid of US taxpayers’ dollars; up to 250 million of them. Wanxiang has been making its case for purchase, saying that it would not buy anything that was militarily sensitive, but some senior figures are still concerned. The auction for the company is today. It will be interesting to see the outcome.

US battery companies heading East

In the wake of the A123 Systems saga and the controversy surrounding the company’s possible sale to the US arm of Chinese giant Wanxiang Group comes the news that fellow advanced battery manufacturer Altair Nanotechnologies has sold the majority of its shares to China-based Canon Investment Holdings.

According to a report in AlterEnergyStocks, the company made the sale to avoid bankruptcy, and that all its operation will eventually move to China.

A123 wanted dead or alive

With the Wall Street Journal, among others, warning A123 Systems’ recent and widely reported filing for bankruptcy protection will be a stick to beat Obama’s energy policy investments, others have used the controversy as an opportunity to boost the US battery industry.

Energy.aol remarks on the popularity that A123 enjoys as a potential purchase amongst a range of corporate suitors, and the robust current and projected market for lithium-ion batteries. Indeed, the USD$125m acquisition of A123’s automotive operations by Johnson Controls has re-invigorated the former’s share price, with Chinese company Wanxiang Group interested in becoming A123’s eventual buyer, reports The Markets Are Open.

Johnson Controls buys A123 Systems assets

Troubled A123 Systems has announced that Johnson Controls plans to acquire its automotive business assets, including an equity interest in Shanghai Advanced Traction Battery Systems Co. The asset purchase agreement also includes provisions through which Johnson Controls intends to license back to A123 technology for its grid, commercial and government businesses.

A123 continues to engage in active discussions regarding strategic alternatives for its grid, commercial, government and other operations, and has received several indications of interest for these businesses, it said in a statement.