Electriq Power, a US provider of battery storage solutions for residential and small business customers, has secured a deal that could be worth more than US$300 million.
The company designs and manufactures a lithium iron phosphate (LFP) lithium-ion battery storage system, Power Pod 2, which in addition to storing onsite generated solar energy and providing backup power, can participate in automated demand response (ADR) programmes in Electriq Power’s home state of California.
Last September, Electriq Power said that its fleet of battery systems played a role in helping keep lights on during heatwaves as California’s CAISO grid strained to deal with high peak demand.
The fresh funding has come from an unnamed “major US clean energy company” which has a platform for solar PV and energy storage design, proposal, and financing across the country, backed by what Electriq Power said is a major player in clean energy financing.
The value given for the 30-month deal is estimated at more than US$300 million, based on the terms of the agreement that cover a large number of customer installations as well as a 25-year joint operations partnership. The deal could encompass a grid services offering.
The announcement comes as Electriq Power prepares to go publicly listed, through a business combination with special purpose acquisition company (SPAC) TLG Acquisition One Corp.
That merger was agreed in November last year and is expected to close in the first half of this year. The battery storage company said then that it expects it to get a valuation close to US$500 million and provide up to US$125 million in cash proceeds.
As well as producing Power Pod 2, Electriq Power offers full turnkey solar PV and storage solutions at no upfront cost. The packages include solar PV and battery equipment, software, project development, financing, installation and enrolment in grid services where applicable.
Along with the expected uplift to the US clean energy market as a result of the Inflation Reduction Act’s incentives, Electriq Power said its business case will be boosted by the introduction of California’s Net Energy Metering (NEM) 3.0 regulations.
NEM 3.0, which has been controversial for many in the solar industry, is California’s latest iteration of the net metering programme, which has seen customers paid an above-market rate for selling electricity to the grid. NEM 3.0 instead cuts that rate down severely and aims to incentivise homeowners to store their energy in batteries and use it themselves or sell to the grid at peak times when it’s most needed.
Various residential battery storage companies have said they expect NEM 3.0 to stimulate demand for batteries, with one provider, Sunnova, saying this week it will offer some eligible customers a free system worth US$8,000 when they purchase and install a solar PV system at the same time.
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