Can Relectrify sell the storage market on its inverterless battery?

Relectrify, an Australia-based maker of battery control electronics and software, announced this morning that it has raised an additional growth round of just over $11 million. The round, led by At One Ventures, will help the company deploy demonstration-scale projects as it looks to break into the commercial and industrial and utility-scale storage markets in the U.S. and Australia.

• The top line: Relectrify’s “CellSwitch” technology allows each cell in a battery to be turned on and off individually, which the company says can extend the operational life of a battery system by up to 30%, and which slashes manufacturing costs (and potentially supply chain delays) by eliminating the need for inverters. 
• The nuts and bolts: CellSwitch converts a battery from direct current to alternating current using printed circuit boards that are attached directly to each individual cell. The system uses off-the-shelf printed circuit boards, and is designed to be embedded into a battery during the manufacturing process. Essentially, it’s both an integrated battery management system and inverter, creating an AC signal without the standalone inverter — and saving both on final system size and manufacturing costs.
• The current take: Cell-level control for battery systems is a “no-brainer,” said At One Ventures founder Laurie Menoud, who will join the Relectrify board. While the cost has held back the technology until now, the current market is primed for solutions that will enhance battery performance and ease manufacturing, she added. “It just makes sense. Any battery system made up of a series of cells should have cell-level control.”

In addition to the 30% longer battery life, Menoud said that replacing inverters, battery management systems, and converters brings the system’s electronics costs down by around 30% too. 

“We’re talking about some seriously exciting unit economics here,” she added.

That said, Relectrify faces many of the same headwinds as the rest of the storage industry, including navigating notoriously lengthy sales cycles with utilities and, given its business model, finding manufacturers to help it break into the market at a competitive price point.

Today CEO Jeff Renaud said the company is focused on “how to get this technology embedded into energy storage systems in a way that truly meets the market on cost, and has a supply chain behind it and a go-to-market structure behind it.”

“I think we’re close to cracking the code on that,” he added.

That “code” is the focus of this latest round of funding, said Renaud: getting the tech deployed at the 100 megawatt scale for new applications, and finding the right partners in both OEMs and utilities.

The startup, which has deployed its technology in several 150 kilowatt-scale containerized battery systems in Australia, has encountered skepticism, Renaud told Latitude Media, in part because “this architecture is very different.” Potential customers and partners want to see it in action, which is why deployments within its targeted commercial and industrial and utility-scale customer segments top the priority list for this week’s influx of cash. 

But ultimately it’s a tech that meets the moment, he added. As multiple industries struggle with grid interconnection issues, improving the economics of assets allows developers to make more efficient use of capacity they’ve already invested in, and makes it easier to maintain system capacity over time.

Getting to market

As the cost of battery cells comes down, Renaud said Relectrify’s platform is designed to adapt accordingly. 

In other words, he’s not worried that dirt-cheap batteries would prevent CellSwitch from penciling out. That’s in part because the platform is cell-agnostic, and in part because it specifically reduces costs inherent to traditional cells, like inverters, battery management systems, and DC balancing.

“If cell costs continue to decline, then these items as a percentage of the total system cost increase, which means that our positive cost impact as a percentage of total system cost will increase,” Renaud said, adding that the equipment definitely decreases costs at the component level.

But estimating its impact on the total system cost is trickier. 

“How it translates into the final product cost is really a function of the OEMs,” Renaud said. “But we start with an advantage at the component level, and that’s what gives me confidence that ultimately it will be competitive.”

That said, Relectrify is “absolutely not” expecting that energy storage systems built on its platform will be on the low-cost end of the market; these will be “premium systems," Renaud said.

“Those systems will last longer, will perform better, than systems built on traditional architecture,” he added. “Yes, we can contribute to lower upfront costs system capex costs, but at the same time, we’re delivering a number of key benefits that see the battery perform better as well.”