US-based lithium-ion battery producer EnerDel is partnering with the real estate arm of Japan’s industrial trading giant, ITOCHU Corporation, to develop and produce the advanced battery systems for a residential smart grid energy storage project to be installed in a major apartment building near Tokyo. The system will provide a critical link between renewable energy, high-speed charging for electric cars and the local utility grid.
It is the second such venture between the two companies, following the announcement last month that they are teaming up with Mazda Motor Corporation on a similar system using vehicles converted to electric drive using a platform designed and built by EnerDel and its partner THINK, which will be stationed at a Family Mart convenience store. (Earlier post.)
We are pushing hard to drive pioneering initiatives like this to develop a secondary market for automotive grade lithium-ion batteries. I believe this secondary market will be a key enabler to reducing battery costs for automotive buyers and accelerating the growth of the market for electric powered vehicles.
—Charles Gassenheimer, Chairman and CEO of EnerDel parent company, Ener1
Sales in the five-story building begin this month, with the first move-ins scheduled for early 2011. Going forward, ITOCHU Property Development, Ltd. aims to introduce the secondary use system to twenty percent of its new apartment buildings. Secondary use implies a battery that has been redeployed from its primary application, normally an electric vehicle, with significant storage capacity remaining. The residual life in that battery can then be sold into a secondary market application, such as community or residential grid storage.
A viable battery aftermarket could lower upfront costs for automotive buyers given that the cost of the battery can be spread over its useful life. Analysts predict that over time this secondary market opportunity for lithium-ion batteries could be two to three times the size of the automotive market opportunity.
The two projects will also gather a continuous stream of long-term performance data on new, stationary battery systems in real time, showcasing system longevity and demonstrating the valuable second life on the grid once battery packs have cycled through their automotive lifecycle, where operating parameters are much more taxing.
In November, EnerDel was selected to supply the batteries that will power a DOE-funded smart grid energy storage project by Oregon's Portland General Electric (PGE) that will help manage peak demand and smooth the variations in power from renewable sources like wind and solar.
The announced ITOCHU and EnerDel partnered projects signify important steps forward in the growing commercial and strategic relationship between the two companies. ITOCHU is EnerDel’s official sales and marketing partner in Japan, and has been a significant investor in parent company Ener1, Inc. since 2003. In July, EnerDel and ITOCHU joined with longtime EnerDel customer THINK to convert electric drive delivery trucks for Japan’s postal service.
ITOCHU is a $100 billion conglomerate with deep ties to the automotive, utility and renewable energy industries. It is the largest global reseller of manufacturing equipment for lithium-ion battery production, providing EnerDel with unique access to specialized equipment and materials.
In addition to THINK and Mazda, EnerDel now has active relationships underway with automakers Volvo and Nissan. Its battery packs are also being tested by the US Department of Defense in a prototype hybrid Humvee.