Energy Storage
confidential | January 2012
Executive Summary
• Eos has developed a safe, reliable, non-toxic, non-combustible, low cost zinc
energy storage system for the electric grid that can be sold for $1000/kw and
$160/kWh, rechargeable over 10,000 cycles (30 years)
• Eos is scaling up battery prototypes to 100 kWh units in 2012 in preparation
for manufacturing and delivery of MW scale systems to customers in 2013
• Eos has developed major partnership for the initial development of 100s of
MW of energy storage projects
• While Eos will emphasize grid-storage with its Aurora product, negotiations
are ongoing with partners to develop automotive and light industrial batteries
using Eos technology
• One full cycle includes full charge, discharge and additional
frequency regulation over the course of one full day.
2
Eos: Energy Storage Solutions Provider
Mission:
Providing the utility and transportation industries with
safe, reliable, low-cost energy and power storage
Eos Aurora
Grid Product:
• 1MW/6MWH energy storage system for the electric grid (1 MW optimal power for 6 hours,
with surge capability)
• Safe, non-toxic, stable, reliable, low capital and operating cost
• Battery price for major orders: $1000/kW, $160/kWh
• 30 year life, 10,000 full cycles*
• First ever long-life rechargeable zinc-air battery
• Scaling up battery prototypes (17kW/100 kWh units) for initial manufacturing in 2012 and
delivery of MW scale systems to first customers in 2013
Vehicle
Product:
• 70kWh battery capable of >340 mile range for $12,000
Value
Proposition:
• Cost competitive with incumbent technology: gas-fired turbines for additional generation
capacity and gasoline powered vehicles
Customers:
• Customer LOIs: >400 MW of product over 5 years
• Eos Genesis Program for utility early adopters and strategic industry partners
* One full cycle includes full charge, discharge and additional
frequency regulation over the course of one full day.
3
The Challenge: Adapting to the Future Grid
• Energy demand growing — projected to grow globally by 36% from 2010 to 2035, including
energy efficiency increases 1
• Aging generating capacity needs to be replaced — by 2025, most coal-fired plants and by
2030, most nuclear plants, will need to be rebuilt or retired 2
• Need for new transmission and distribution — $180B of planned US transmission projects 3
• Infrastructure driven by peak demand — 25% of distribution and 10% of generation and
transmission assets (worth multi hundreds B$) used less than 400 hours per year 4
• Growing renewable generation that is intermittent leads to grid instability and—in some
cases—curtailment or negative pricing 5
1) IEA, 2010. 2) NERC, 2010. 3) Quanta, 2010. 4) EPRI, 2010. 5) CAISO, 2007.
4
The Solution: Energy Storage
Energy Storage Usage Can:
•
•
•
•
Improve efficiency and profit of existing generating assets
Defer costly upgrades to transmission and distribution infrastructure
Avoid additional peak generating capacity investments
Increase adoption and profitability of renewable energy
5
The Largest Supply Chain in the World Has No Storage
Total Annual Crude Oil Production =
4,748,067,825 m3
Total Annual Electricity
Consumption = 20,000,000 GWh
Oil Storage =
600,000,000 m3
(12.6%)
Energy
Storage =
1,270 GWh
(.0064%)
Oil storage = 46 days
Electricity Storage =33 minutes
A 2000X differential
http://www.eia.gov/forecasts/ieo/electricity.cfm,
http://www.investorideas.com/Research/PDFs/Top_10_Global_Oil_and_Chemicals.pdf
6
Global Market: $500B
BCG:
$400B1
Piper Jaffray:
$600B2
Worldwide, the energy storage market is
forecasted to grow over the next five
years at a CAGR of:
40-55%3
Lux Research:
$64B/year 4
1) BCG, 2010, estimate 280 Euros. 2) PiperJaffray, “Energy Storage”, February 2009. 3)
http://www.marketwire.com/press-release/Smart-Grid-Energy-Storage-Market-to-Grow-397Annually-Through-2013-1329898.htm 4) http://www.evworld.com/news.cfm?newsid=18336
7
Present Value of Energy
Storage Application
Current Batteries:
High Capital Cost Limitation
US Market Sizes of Different Energy Storage
Applications based on the Estimated Present
Value of their Benefits
EPRI, Electricity Energy Storage Technology Options, 2010.
At a Li-ion capital cost in
the >$1000/kWh range
there are only a few GW
of demand
8
Present Value of Energy
Storage Application
Eos Low Capital Cost
Opens Markets
US Market Sizes of Different Energy Storage
Applications based on the Estimated Present
Value of their Benefits
EPRI, Electricity Energy Storage Technology Options, 2010.
Market opens up for
solutions with Eos’ capital
cost of $160/kWh
9
Eos Aurora Meets Key Requirements
Eos Aurora 1000|6000
Low Capital Cost
$1000/kW initial price; $160/kWh
Large volume of energy
and power
1 MW/6 MWh standard system size (made of 17KW/100KWh building blocks)
Long life-cycle
Designed for > 10,000 true cycles* and 30 calendar years of operation
Quick response time
Response time: Immediate
Safe to locate in urban
load centers
Non toxic, environmentally benign and stable
Instantly deployable
Delivered in a standard ISO 40’ shipping container
Low operating and
maintenance costs
No periodic replacement of components (e.g., membranes, cells, battery packs) required
* One full cycle includes full charge, discharge and additional
frequency regulation over the course of one full day.
10
Competition
• Peak load reduction via energy efficiency
and demand response
• Capacity additions from gas peaking plants
• New transmission and distribution spending
• Other energy storage providers
11
Current World Electric Energy Storage Capacity
Compressed Air Energy Storage
440 MW
Sodium-Sulfur Battery
316 MW
Pumped
Hydro
127,000 MWel
Over 99% of
total storage
capacity
Lead-Acid Battery
~35 MW
Nickel-Cadmium Battery
27 MW
Flywheels
<25 MW
Lithium-Ion Battery
~20 MW
Today’s electricity
energy storage is
almost exclusively
pumped hydro
Redox-Flow Battery
<3 MW
Fraunhofer Institute. EPRI, Electricity Energy Storage Technology Options, 2010.
12
Eos Levelized Cost of Peak Energy vs Leaders
Eos’ levelized
energy cost is
comparable to
pumped hydro
and gas turbines
* Non-Eos data source: EPRI, Electricity Energy Storage Technology Options, 2010.
Natural gas fuel cost range: $6.5 -8/MMBtu. Levelized cost of energy includes cap.
fix, and var. costs. Gas peaking cost estimate from Lazard, 2009, midpoint of est.
range; assumes: 150MW facility, Capital cost $1,125/MW, Heat rate 10.5
MMBtu/MWh, Cap. factor 10%, Facility Life 35 years, Construction time 25 months.
Eos: 2MW plant, 25% cap. factor (6hrs of energy production), Roundtrip efficiency of
75%, Cap. cost for entire system with Eos battery $1.7/watt, O&M costs:
$20,000/year for a 2MW/12MWh operating costs, Facility Life 30 years.
13
Eos Superior to Gas Peaking Plants
Eos utility scale energy
storage systems can be
cheaper than gas peaking
plants when compared
at realistic operating
conditions
* Chart Notes: Levelized Cost of Energy included cap. fix, and var. costs. Gas peaking cost estimate
from Lazard, 2009, midpoint of est. range. Assump: 150MW facility, Capital cost $1,125/MW, Heat
rate 10.5 MMBtu/MWh, Cap. factor 10%, Facility Life 35 years, Construction time 25 months. Eos:
2MW plant, 25% cap. factor (6hrs of energy production), Round-trip efficiency of 75%, Cap. cost for
entire system with Eos battery $1.7/watt, O&M costs: $20,000/year for a 2MW/12MWh operating
costs, Facility Life 30 years.
14
Eos Energy Storage vs. Competitors
 = Good
 = Medium
 = Poor
Eos
Low capital cost/kWh










Large volume of energy storage
capacity










Long life (high # of life-cycles)










Quick response time (milliseconds)










Safe (non-toxic, non combustible)










Flexible to locate (in cities)










Low O&M costs










In commercial production










15
Eos Competitive Advantages
Fraction of capital and operating cost
System-level energy density
Eos
vs.
Li-ion
Safety
Long and deep cycle life
Cell Cyclying Performance Improvement Over Time
2,400
2,200
2,000
Number of Cycles Demonstrated
1,800
1,600
1,400
1,200
1,000
800
600
400
200
Q4 2009
Q2 2010
Q4 2010
Q2 2011
Q3 2011
Q4 2011
confidential
16
Value Proposition: Grid and Load Centers
Grid/Utility Benefits
End User Benefits
• Electricity peak shifting (arbitrage)
• Supply of flexible, distributable capacity
• Ancillary services
•
•
•
•
✴
✴
✴
Load following
Frequency regulation
Voltage support
• Transmission congestion relief / upgrade deferral
• Renewable energy integration support via supply
firming and time shift
Time of Use (TOU) Energy management (arbitrage)
Demand charge reduction
Electricity supply reliability improvement (backup)
Electricity supply quality improvement
a variety of overlapping
revenue streams
17
Convergent Energy & Power:
Eos Preferred Supply Partnership
• Convergent Energy & Power is an energy
storage development company backed by
Fisher Brothers/Plaza Construction that
plans to develop 400 MW of energy
storage by 2020
• Eos will supply batteries for development
as merchant power plants both in load
centers (behind the meter) and directly
on the grid
18
EV Demand: The Context
• Demand drivers for hybrid, plug-in hybrid and electric vehicles:



Oil price volatility
Energy security
Climate change
19
EV Demand: The Context
•
Transportation accounts for 2/3 of US oil consumption
The Math (Mbd)
US oil consumption: 18.7
(of which vehicles: 10.7)
Domestic production: 9
Widespread adoption
of EVs could reduce or
eliminate US oil
import dependence
US Transportation Databook, 2011
20
Global EV Battery Opportunity: > $33B/yr.
Global vehicle focused energy storage market estimate:
• 2016: $16B
• 2020: $33B
Market elasticity high
for low cost (Eos) EVs:
Would you buy an EV if
it had the same range
and price as an ICE
vehicle?
Lazard Capital Markets, Shrestha, Sanjay, Martin, Sarah and Zhang,
Jenny (Lazard Capital Markets), “Alternative Energy & Infrastructure”,
March 5, 2010
21
EV Challenges
• High battery cost


$700 to $1,000/kWh sale price to OEM’s today
$250/kWh goal from US Advanced Battery Consortium
• Driving range too short

40-190 miles today vs goal of 350 miles
• Charge time too long

7 hours to charge 24kWh Nissan Leaf
• Safety
BCG, Batteries for Electric Cars, 2010.
http://www.nissanusa.com/leaf-electric-car/faq/list/charging#/leaf-electric-car/faq/list/charging
22
Eos’ Electric Vehicle Strategic Partnerships
Potential EV Configurations:
Eos Aurora zinc-air battery
Eos Vista zinc-air flow battery
•
•
•
>300 Mile driving range
Same cost as ICE vehicle
$0.02/mile fuel cost
•
•
Refuelable in addition
to rechargeable
Lower cost per kWh
"These are magical distances. To buy a car that will cost $20,000 to
$25,000 without a subsidy where you can go 350 miles is our goal."
- US Energy Secretary, Steven Chu
* http://www.bcg.com/documents/file36615.pdf, pg. 5.
23
EVs: Battery Cost vs ICEs
Eos Goal:
100-200 $/kWh
Morgan Stanley, 2011
24
Gasoline Car vs Li-ion EV vs Eos EV
Toyota Camry
EV with Li-ion
(Nissan Leaf)*
EV with Eos
Aurora Zinc-Air
Battery
EV with Eos
Vista Flow Battery
Capital Cost of Car
$25,000
$33,000
$25,000
$25,000
Propulsion System
Internal Combustion
Engine
24 kwh Li-ion battery
80 kw motor
Eos Zinc-Air battery,
Eos lead acid battery
Eos Zinc-Air Flow
battery, Eos lead
acid battery
Range (miles)
400
75-100
340
400
Refueling Time
3 mins
5-7 hrs with
220-240V charger
6 hours
3 mins
.20
.03
.02
.02
179 hp
107 hp
175 hp
175 hp
Cost of fuel/mile at
$4/gal gas
HP (peak)
*http://www.nissanusa.com/ev/media/pdf/specs/FeaturesAndSpecs.pdf
25
Eos EV Strategy
Partner with EV industry players
Goal:
• Work with existing EV players to jointly develop technology
Eos Offering:
• IP for two battery configurations that can enable >340 mile driving range
at $12,000/100kwh
Potential
Partners:
• Battery companies, Tier 1 suppliers, OEMs
Time-frame
• With right partner, EV battery could be available for prototyping
within 24 months
26
What is a Zinc-Air Battery?
•
Widely used today for high-energy density, low-cost, single use applications
• e.g. hearing aids
•
•
Based on similar chemistry used in standard alkaline AA and AAA batteries (Zn/MnO2)
Replaces manganese dioxide (MnO2 ) with thin air electrode, saving space and cost
• Air electrode contains carbon and catalysts, which absorb and catalyze oxygen to allow it to react with zinc,
eliminating need to contain cathode reactant in battery so most of battery can be filled by zinc anode,
saving space
Zinc or Metal Air provides highest potential energy density for batteries
Energizer, Zinc Air Prismatic Handbook
confidential
27
Zinc-Air Advantages
• High energy density
• Materials are safe, low cost, locally sourced,
readily available

Zinc:
• Cheap: One of the world’s most plentiful
and inexpensive metals
• Non toxic
• Locally available - three of top five zinc
producers: US, Canada and Australia

Air
• Inexpensive to manufacture
• Environmentally friendly
Vs
.
Other batteries need to hold a large
amount of cathode reactant, equivalent to
pulling a trailer full of gasoline oxidizer
(air) behind your car. Zinc-air batteries
have higher energy density since they—
like gasoline engines—use ambient air as a
reactant, and therefore don’t need to carry
it in the cell, increasing energy density
28
Eos’ Proprietary Problem/Solution Portfolio
The Problem
Eos Solution
• Air electrode clogging due to carbonate, as a result of CO2
absorption with traditional KOH electrolyte
• Novel aqueous electrolyte with near neutral pH
• Rupture of ion-selective membrane due to dendrite formation
of Zn metal, caused by electrolyte and wear and tear over time
• No membrane required and electrolyte is non-dendritic
• Electrolyte drying out over time as oxygen enters
• Electrolyte management system and self-filling/healing
system design
• Zinc electrode changes shape due to expansion from the
change in density from zinc metal to zinc oxide
• Electrode maintains integrity and shape during charge and
discharge cycles
• Zinc corrodes due to inefficient plating
• Proprietary additives optimize zinc plating
• Materials degradation/corrosion over time
• Selection and proprietary treatment of materials
• Cell ionic and electrical connection failure
• Integral and redundant electrical and ionic connections
29
Eos Progress to Date:
>2000 Cycles with No Degradation
Cell Cyclying Performance Improvement Over Time
2,400
2,200
Number of cycles
increased 20x
since start of
testing Q409
2,000
1,800
Number of Cycles Demonstrated
First focus has
been to prove
rechargeability of
zinc-air
1,600
1,400
1,200
1,000
800
600
400
200
Q4 2009
Q2 2010
Q4 2010
Q2 2011
Q3 2011
Q4 2011
30
Innovation: Design for Ease
of Manufacture
• System designed for low cost manufacturing and
quick scale-up



Materials inexpensive and widely available
Injection molding
Metal stamping, requires minimal and low cost tooling
31
Expert Opinions of Eos
“Metal air batteries…
have the potential
to be lower-power,
long-duration energy
storage devices…”
- SCE, 2011*
“Eos has developed a number
of improvements for the
conventional zinc-air battery
to become a viable secondary
battery.”
- KEMA Energy Consultants
• SCE, Rittershausen J and McKonah,
Moving Energy Storage from Concept to Reality, 2011.
“Metal-air batteries contain
high energy metals and
literally breathe oxygen
from the air, giving them
the ability to store extreme
amounts of energy.”
- US Energy Secretary,
Steven Chu
“(Eos’) novel nonflow design offers
elegant approach to
management of
prior zinc-air
issues.”
- Electric Power
Research Institute
32
IP Protection
• Obtained and applied for multi-layer patent protection on key intellectual
property




Cell configuration and architecture
Cathode design, materials and catalysts
Electrolyte and additives
System configuration and electrolyte system
• Three major patents registered and pending in the US and abroad, and
will be applying for at least one more
33
Other Eos Technologies Under Development
Eos Vista Zinc-Air Flow Battery
Eos Innovation:
• Based on Eos zinc-air technology
• Allows decoupling of the power and energy of the battery for more flexible
configuration and lower cost per kWh
• As battery discharges, the used electrolyte is stored and replaced, and more
zinc is added, allowing for battery operation to continue
Addressable
Markets:
• Electric vehicles
• Stationary power
Status:
• Further design development required
34
Business Timeline
MARKET/TECH
2011
R&D
Eos Aurora
Grid Storage
2012
2013
2014
2015
Q1 Manufacture Prototype
Pilot tests
Scale Manuf.
Marketing and Sales
Convergent
Energy & Power
Convergent:
Pre-Dev.
Site Prep
Asset Deployment
• Prototype manufacturing plant to be located in Eaton, Penn
• Online in Q1 2013
• Scale manufacturing in 2013 / 2014
• Convergent Energy & Power launching project development in Q4 2011
35
Summary
• The Eos Aurora will be a safe, reliable, non-toxic, non-combustible, low cost
zinc-air energy storage system for the electric grid that can be sold for
$1000/kw and $160/kWh, rechargeable over 10,000 cycles (30 years)
• Superior value proposition to incumbent technology: gas-fired turbines for
additional generation capacity and gasoline engines for transportation
• Scaling up battery prototypes (100 kWh units) in 2012 in preparation for
manufacturing and delivery of MW scale systems to first customers in 2013
• Strategic partnerships and pilot customers
• One full cycle includes full charge, discharge and additional
frequency regulation over the course of one full day.
36
www.eosenergystorage.com