Two companies plan to purchase 50GWh of energy storage batteries from Norway company FREYR

Tom Jensen, CEO of Norwegian lithium-ion battery start-up FREYR Battery, said in an interview with industry media that the company's gigafactory could use half of its 100GWh capacity target for energy storage systems by 2030, and will also introduce system integration business.

Founded in 2018, FREYR is based on the three core principles of speed, scale and sustainability. The company has a huge plan to build a gigafactory. The four gigafactories planned to be built in MoI Rana, Norway, with a total annual capacity of 36GWh, will be online from 2023 to 2025. But unlike other players in the battery industry, FREYR's battery products are mainly supplied to the energy storage industry.

April 22, 2022

Jensen said, “Our goal is to have 83GWh of annual capacity by 2028 and over 100GWh by 2030, and based on where we are now, we think that half of the batteries produced can be put into the energy storage market by 2030.”

He explained that the technology FREYR has licensed from US battery producer 24M to manufacture batteries is very suitable for energy storage applications, so it is mainly aimed at all market segments of battery energy storage systems, which can theoretically use more than half of the battery capacity. in the battery energy storage industry.

Jensen said: “We believe that the battery storage market is growing much faster and will be much larger than most people think. So, if we want to, we can actually put all the capacity into the storage market. .

But we're also very interested in the mobile device and electric vehicle markets, so the final percentage of our capacity will depend on how the market develops. But the battery technology we have and our positioning in the battery energy storage space makes us a leading provider of battery energy storage solutions, and we will obviously gain more market share. "

The importance of the energy storage market as the company's main market is clear from the fact that FREYR has announced two major off-take agreements in this area. Honeywell will buy 19GWh batteries from FREYR between 2023 and 2030, while another unnamed partner will buy 31GWh batteries over the same period, which will allow FREYR to contribute to its systems integration business .

Jensen said, “Once finalized, we believe these two preliminary off-take agreements are likely to take up most of the capacity of our first gigafactory, which will be operational in 2023, within the first four to five years.

We hope to form a joint venture with an unnamed partner to develop containerized energy storage solutions, which include other products such as battery management systems (BMS). This will effectively be the system integration method for working with this partner. "

Jensen also touched on three large discussion topics in the battery energy storage space and in the wider battery ecosystem: Lithium Iron Phosphate (LFP) vs Nickel Manganese Cobalt Ternary Lithium (NMC) Pros and Cons Debate, Lithium Battery Materials Supply Chain issues and battery sustainability, these are the main principles followed by FREYR.

Lithium Iron Phosphate Battery (LFP) vs Nickel Manganese Cobalt Ternary Lithium Battery (NMC)

Lithium Iron Phosphate (LFP) batteries will become increasingly It is increasingly adopted by the battery energy storage industry.

“Our technology platform is flexible,” Jensen said. “Our first gigafactory will be producing lithium iron phosphate (LFP) batteries, which we are seeing increasing interest from many automotive stakeholders, to meet customer demand. more interested.

Customers are also very interested in our production of nickel-manganese-cobalt ternary lithium batteries (NMC). But where we use cobalt, it will be sourced responsibly and sustainably through our partnership with Glencore. "

He pointed out that compared with lithium iron phosphate (LFP) batteries, lithium iron phosphate (LFP) batteries with lower energy density are not as important in the energy storage environment of the number of charge and discharge, and because of the ability to choose to produce batteries with larger specifications, 24M's technology also has advantages.

Another topic of discussion was the issue of the global supply chain, which, according to other sources, has caused the price of lithium iron phosphate batteries to temporarily match or even lower the price of nickel-manganese-cobalt ternary lithium batteries (NMC) for the first time.

"What we're seeing right now is a temporary bottleneck, and of course it's challenging in terms of near-term pricing, but we're having conversations with our customers and working out business arrangements to deal with material price increases," Jensen said.

I think all battery manufacturers face the same challenge. So relatively speaking, the price of battery products will become more expensive, but the relative cost advantage of this technology is still the same.

He said FREYR's capital requirements may have increased since a year ago, but any necessary additional financing will be drawn from governments and capital markets regarding the role of energy storage in the energy transition. The company has a market value of more than $1 billion since its SPAC merger last July.

Sustainability, as mentioned earlier, is one of the three principles that Jensen calls FREYR, along with speed and scale.

He said, “We are confident that we will produce the cleanest or greenest batteries in the world. Compared with traditional lithium-ion batteries, our initial goal is to reduce the carbon emissions of battery products by 80% in the life cycle of battery products by 2025. Over time, we aspire to achieve net zero emissions."

Norway is one of the few countries to achieve its goal of 100% renewable energy, thanks to its abundance of hydroelectric power. Jensen said FREYR's battery production will come almost entirely from renewable hydroelectric facilities, but also some from wind.

Jensen said, “In addition, we plan to selectively cooperate with and invest in upstream manufacturers, which means investing in materials for battery manufacturing. A large part of the carbon footprint of batteries comes from the way the raw materials are produced, so if we do realize the removal of the battery itself. carbon, we need to make these materials produced using renewable electricity.”

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