I was quite shocked by the response to the Energy Storage Company Directory: I received many tens of emails about it, with additions and edits requests, expressions of appreciation, discussions and suggestions. It is exciting – it must have filled a need. Thanks to this great feedback, the directory has improved a lot!

This week-end I added a new category for utility-scale inverters to the Directory.

Most members in the category are well established companies. Technologies are quite mature, with efficiency at 97% to 98% for most of the fielded products. While you find many products listed for use with wind or solar, very few of them are actually listed for energy storage (although they can all be designed into energy storage systems). This is something that I see changing over the next few years – definitely an opportunity for differentiation.

Thanks again to everyone who took the time to email or comment on the directory. As with the other sections of the directory, this first try at the utility-scale inverter category will need plenty of improvement. Let me know what is missing, incorrect, or incomplete!

Energy Storage Company Directory

Sometimes you feel really pleased with yourself for the smallest thing… What happened to ZettaCore, and what does full-stealth energy storage company eSionic do?  I think I know.

There are two mysteries here. One of them is the sudden and quiet disappearance around 2011 of ZettaCore ( engineered molecules technology focused on memory chips) after over 10 years of existence and over $40M in funding. The other one is the sudden and quiet appearance of a super-stealth energy storage company named eSionic (“proprietary molecular systems” technology, focused on energy storage) in 2012 in the Kleiner Perkins portfolio. Here is the story.

ZettaCore was a well-funded startup, founded in 1999, which received three funding rounds through 2009, gathering a total of $44M. ZettaCore picked up $5.5M in its first round, from Access Ventures, Garrett Capital, Stanford University, Draper Fisher Jurvetson, Radius Ventures, and Oxford Biosciences. It then obtained $17.5M from its second round, led by Kleiner Perkins. A $21M third round in 2009 added Panasonic Ventures, Globis Capital Partners, Itochu Technology Ventures, Yasuda Enterprise Development, and Epic Ventures to the investors’ list (GigaOm listed a total of $75M over three rounds, but I think it is an error unless the second round somehow got longer after it closed, as I could only track the amounts listed above).

ZettaCore’s core technology was engineered molecules, multi-porphyrin nanostructures functioning as capacitors. ZettaCore focused its original application  on molecular memory (here is an excellent explanation of its process in 2005, by its VP Manufacturing at the time, Ritu Shrivastava). But, by 2009 (their third round), it looked like their original bet on memory was getting long in the tooth, and, at the time, Zettacore started to mention heat storage liquids for CSP (Concentrating Solar Power) as a possible future application.

ZettaCore’s website mysteriously disappeared some time in 2011, as did its name on some of its investors’ portfolio lists (as of today it still is on Panasonic Ventures’ portfolio and on Vinod Khosla’s board list). At some time in 2013 I tried to track them down, but could not find a sign of either life or death for them. I gave up, promising myself to look into it further at a later time (I never did, of course).

Around the same time frame (2011-2012),  eSionic appeared on the web and on Kleiner Perkins’ portfolio. eSionic’s site is one of the most skeletonized sites I have ever read: even today it still has no information on what the company actually does, although the actual web site name tag lists “Energy Storage, eSionic Corp Technology,” which is more than you can get on the content pages.

In fact, the story for me started right there, on eSionic’s site: what was the company doing? The only information I could glean on the site for the company mission was “solving problems at energy electronics nexus”. Not really helpful… Yet there was a hint: “we are doing this through the use of proprietary molecular systems.” At first, this did not ring any bells for me: ZettaCore was not in my mind as I was perusing through the eSionic site – the very little there was.

Some research uncovered this release on eSionic’s new CEO: Srinivas Nimmagadda Appointed CEO of eSionic — MENLO PARK, Calif., June 13, 2012 /PRNewswire/ —. There I found that Nimmagadda had been VP of Business Development at ZettaCore, ” where he was instrumental in the founding and development of the molecular interface business, which led to a successful acquisition.” The release also mentioned that he was succeeding Subodh Toprani in the position. But I remembered that Subodh Toprani had been appointed CEO of ZetaCore in 2004!? And ZettaCore also used proprietary molecular systems!?

This was the first link I had found between the two companies, and it raised some questions in my mind. Who had acquired ZettaCore? Where was the funding announcement for eSionic? Where did the eSionic founders come from? Could there actually be a connection between the two? I decided to have a look at the board of directors for eSionic.

The directors were Mark Allen (partner at Kleiner Perkins, which had invested previously in ZettaCore), Matthew Gibbs (partner of Oxford Bioscience, which had invested previously in ZettaCore), Steve Jurvetson (partner at Draper Fisher Jurveston, which had invested previously in ZettaCore), Srinivas Nimmagadda (who was VP Bus Dev at ZettaCore), and Subodh Toprani, the last CEO of ZettaCore! Coincidence? I think not.

The next step was to check the management team. Outside of the CEO, the only person listed was the VP of Technology, Dr. Steven Shi. When I checked his bio, his last company was … ZettaCore, where he was Director of Electrochemistry. Coincidence? I think not.

I still was not 100% sure of what exactly had happened, so I kept on looking. I finally found the smoking gun in the Biography of Kaz Terada at A2O Ventures: “eSionic (formerly called Zettacore)” (it might not be there tomorrow, but it is there today!).

Case solved. eSionic is the rebirth of ZettaCore through some corporate restructuring, possibly involving a repurchase/recapitalization (“purchase”), with a core technology of porphyrin engineered molecules, refocusing on energy storage. This major strategy change must have started happening in 2010 (or, at least, the writing must have been on the wall), since the well-regarded ZettaCore VP of Manufacturing, Ritu Shrivastava (see above), left for SanDisk in 2010 (check his linked-in profile).

But what about the new company focus, the issue that had attracted me in the first place? I still did not have an answer. There were three primary choices in my mind. eSionic might still have been focusing on heat storage liquids for CSP – but it seemed like too small a market. The two other possibilities, based on the core technology (capacitive nanoparticles), could be battery electrolytes or supercapacitors. Given the amount of VC funding getting into batteries vs. ultracapacitors, my money was on electrolytes. I decided to look further by tracking the original founders of ZettaCore.

I went back to the first round announcements for ZettaCore, and found that one of the original academic founders, Werner Kuhr, had become full-time VP Technology for the company. What had happened to him? A quick look at his linked-in profile gave me the final answer: “Oct. 2011-August 2012, as Strategic Technical [Counsel] at eSionic Corp., Dr. Kuhr worked as part of a management team that implemented the development of ionic liquid electrolytes for the energy storage industry based on ZettaCore technologies.” Bingo.

The fact that such a valued founder as Dr. Kuhr left the company at this time made be wonder if there was a significance to that move (moving away from chip manufacturing explained the departure of the Manufacturing VP). His departure, combined with the background of the new CEO (Business Development) probably means that the company has shuttered its broad ambitions around engineered molecules, and is now looking at a more limited definition of success.

Now, with all the pieces in hand, here is how I read the story: it became clear in 2010 that ZettaCore would not succeed in its original direction. In October 2011, a part of ZettaCore transitioned to becoming eSionic (the rest of the company went away), within the new industry of energy storage, focusing on ionic liquid electrolytes (and possibly more in store), using the same core porphyrin engineered molecules technology. By mid-2012, the direction was stable, the transition was over, and the company restarted itself under its new CEO, its previous CEO becoming executive chairman.

A bit of a detective story! I should have figured it out earlier: after all, both companies like to use capitals in the middle of their names…  I am contacting eSionic to find out if they will confirm the story – I’ll let you know what I find out.

[Edit] Improved the flow of the story.

It is hard to keep track of the movers in the world of energy storage.

I took a shot at assembling, as a list, an Energy Storage Directory, focused on technology development rather than integration, and sorted by technology. I included players that had enough capitalization and/or technology to have an impact on the market. I am not planning to list local or regional integrators.

I am sure that I missed a good number of players – it is clearly a work in progress. Let me know what you think, how it could be made better, and who I should add. I included a request form allowing listing requests at the bottom of the list.

Energy Storage Directory

The announcement of a new strategic partnership between French groups Areva and Schneider in the sector of energy storage raises many questions. To me, the primary ones are:

• Who is contributing what to the partnership?
• What is the venture aiming for?
• Is it likely to be successful?

My summary guesses:

• Areva is contributing the technology (fuel cell, control harness, and management front end), while Schneider is providing distribution and marketing.
• If the venture has a clearly defined market (which I am not sure is true), it is probably off-grid Africa #1, islands of the South Pacific #2, less developed parts of Asia #3.
• This is a top-driven venture with a low likelihood of success.

My analysis follows.

Background

Areva is mostly state-owned, and largely focused on the construction and operation of nuclear power plants. Schneider Electric is a multi-entity industrial group, covering a large number of fields related to electric power equipment, competing with Siemens and Rockwell in many areas.

Both companies have been on a downward trend in the past few years. Areva has been hard hit by the Fukushima disaster (resulting in a shutdown of nuclear power construction, at a time when a rebirth seemed likely). Its latest construction efforts, focusing on a new generation of nuclear reactors (3rd generation EPR), have been plagued with enormous delays (7 years+) and huge overcosts (90%+). Schneider group has shown little intrinsic growth, and grown mostly through acquisitions that have significantly diluted its core strengths. It appears to have lost significant competitively on the marketplace in all international markets.

Both companies are looking for newer, greener fields where they can recover some momentum. They both have a renewable energy unit (or group of units).

Partnership

The partnership announcement indicates that Areva is providing its “Greenenergy Box” technology, while Schneider is providing nothing. The technology in question is a electrolysis-based hydrogen fuel cell that can be coupled to a photovoltaic power plant, and has had a pilot installation in Corsica for 3 years (coupled with a 560kW solar plant).

Since Areva does not have commercial distribution capability, Schneider is expected to provide this part of the venture. For Schneider, it will be a significant effort for their sales teams, but the original cash outlay is low. This means the decision to go into the venture was an easy enough one for Schneider that they may not have properly assessed how much work will have to be contributed downstream for the venture to be successful.

Technology

The Electrolysis + Fuel Cell combination has been a very popular one in the past 20 years when looking at initiatives. But its commercial success so far is limited. As a storage technology, it has poor AC to AC efficiency. Of course, its efficiency is not the primary argument of sale, it’s the energy capacity that is important to the application. Mostly, its usability and reliability have been questioned, because of the difficulty in separating hydrogen, and the dangers of its manipulation. While there are several examples of electrolysis in grid-scale applications, I don’t know of any successful commercial-scale applications combining electrolysis and H2 fuel cells.

Is it possible that Areva, a company focused on building GW nuclear units, can understand the constraints of designing a MW-sized fuel cell that must be sold, installed and operated to/by customers it has never dealt with? It seems more likely to me that, within Areva, the initiative starting the business was top-down driven by a large administrative company, attracted, like many others in the past 20 years, by a seductive technology idea. They might have been more successful than companies such as Toyota, which have been working on a similar technology for many years – but this seems unlikely to me.

So, in my eyes, the likelihood that we have a runaway success technology here is quite low.

Market goals

The partnership announcement specifically mentions its focus on isolated locations. There is not much market in Europe for isolated locations with no access to the grid which would need to rely on solar PV and stored energy from solar PV for their power. On the other hand, Schneider has good penetration in much of Africa (where Areva also has mining and refining operations), along with some parts of South East Asia (Vietnam and Laos), and, of course, the large number of islands controlled by the French in the South Pacific – the latter being an ideal but small market for the technology. These markets likely represent the primary goal for the venture, in the order of #1 Africa (size), #2 Pacific islands (easy reach), #3 SE Asia.

As the specified market is for isolated locations, this means that the price point is too high to make sense for other uses in grid-connected areas, and we can rule these out.

Likely success

Given Areva’s lack of access to customers potentially served by the technology, it is probable that the technology development resulted from top-down design, with little input from eventual customers.

The technology itself (electrolysis and hydrogen fuel cells) has been extensively studied but has not shown successful commercial deployment so far.

Because of its hydrogen handling, there is operational danger in the technology. The past ten years have shown that the handling of explosive or flammable gases is difficult to manage in developing countries: there are many biomass plants built for $10M to $50M in the 2000s now mothballed in China, because their operation ended up being too dangerous (due to the presence of CH4) without tight operations management skills on location. I expect similar problems with H2 management.

These factors, together, point at a low likelihood of success for this partnership- low, but not zero.

It’s too bad, really. There is great power density in hydrogen fuel cells, and great attraction in the concept of using shed power from solar or wind to store energy into hydrogen fuel cells. So I really hope that I am wrong in my conclusions. I would love to see the scheme successful.