No power. No water. Below freezing temperatures.
These are the apocalyptic conditions that millions of people across Texas have had to endure over the past week, as unusually cold weather has laid waste to the state’s electric grid.
It’s an awful situation. And it’s not isolated.
We only have to go back a few months to late summer 2020 to see the last time this happened. That’s when millions of folks in California lost power because of a heat wave across that state.
Too hot. Too cold. Today’s energy grid is like Goldilocks — the situation has to be just right, or it won’t work.
Unfortunately, climate change means that “just right” is becoming abnormal. Too hot and too cold will become more and more frequent going forward. This change in prevailing temperature conditions requires a change in our energy grid… else, blackouts will become commonplace.
What’s the fix?
Energy storage solutions.
Specifically, develop and deploy robust energy storage solutions across the grid — from big storage plants at energy generation hubs, all the way to small storage boxes at homes and offices — so that even if the grid goes down and/or power generation goes offline, there is abundant “backup” power stored to keep the lights on.
That’s the future.
It starts now— and it’s a multi-trillion-dollar revolution which you don’t want to miss…
The global energy storage market is expected to increase 25X by 2030, and will represent a $1.2 TRILLION opportunity by 2050.
Make no mistake. Energy storage represents one of the most compelling long-term investment opportunities in the market today.
Today, we will give you one way to play this burgeoning megatrend. It’s by buying a small energy storage player with a potentially breakthrough technology that virtually no one is talking about… but which could represent the future of energy storage solutions everywhere.
Creating a New Class of Scientifically Superior Energy Storage Batteries
There are two companies at the forefront of the energy storage market today:
- Tesla (TSLA), who needs no introduction and has a Powerwall solution that pairs seamlessly with its solar panels.
- Stem (STPK), a smaller company we told you about a few weeks ago that is leveraging its AI system Athena to smartly manage onsite energy storage and usage.
Both are great companies. But both are also building their storage solutions on lithium-ion batteries.
That’s because lithium — as the third lightest element in the Universe — is essentially unrivaled in terms of energy density, so you can make really effective batteries that are also really small. In markets where energy density matters (like EVs), lithium-ion batteries make the most sense.
But they make less sense in markets where energy density is less important, like in energy storage, where making a small-as-can-be battery isn’t critical. Here, lithium-ion batteries are being used today simply because they are the incumbent solution. But this incumbent technology has some major shortcomings…
For starters, lithium is a rare earth metal. There’s not a lot of it just laying around. And most of it comes from South America and Africa. So, lithium-ion batteries are simultaneously supply-constrained and prone to supply chain disruptions.
In an energy storage market that’s expected to grow 25X over the next decade, these supply problems are a major issue.
Meanwhile, for various scientific reasons, lithium-ion batteries have a poor depth of discharge — or the capacity of the battery that normally gets depleted before it has to recharge. Li-ion batteries average a depth of discharge of about 80% — not 100% — so every time the battery is about ⅘ depleted, it needs to be recharged.
This leads to a shorter life for the battery, because the more a battery needs to be recharged, the quicker it wears out. Again, this is problematic in energy storage where the solutions are big and quite expensive — and therefore, expected to last a long time.
Even further, lithium-ion batteries aren’t all that safe. Lithium reacts intensely with water, forming lithium hydroxide and highly flammable hydrogen as a byproduct. Needless to say, something that can explode or catch fire will have a tough time gaining traction in homes and offices…
Clearly, lithium-ion batteries are not the future of energy storage. So… what types of batteries are?
And one small, $1.2 billion company by the name of Eos Energy Enterprises (NASDAQ:EOSE) is on the cutting edge of creating a new generation of potentially game-changing energy storage solutions built on zinc batteries.
Here’s the story.
Eos Energy recognized early-on the shortcomings of lithium batteries in energy storage. So, management searched high and low for a scalable solution that addressed lithium’s shortcomings.
That led them to zinc.
Zinc — unlike lithium — is a common earth metal. It’s not rare. It is everywhere, and there’s a lot of it in the US. Zinc markets are therefore not supply-constrained or prone to supply chain disruptions.
Zinc also has certain scientific qualities which give it a better depth of discharge than lithium. The zinc batteries made by Eos have a 100% DoD — meaning they last far longer.
Meanwhile, zinc does not react intensely with water. So, zinc batteries can use water as the electrolyte, and therefore, are not flammable. They’re much safer than lithium batteries.
100% supply secured. 100% DoD. 100% safe.
It’s no wonder many industry insiders believe that zinc batteries represent the future of the energy storage market.
Eos is one of the very few companies actively commercializing this breakthrough technology today, with a novel aqueous zinc energy storage solution that — through longer cycle lifes and lower material costs — has 30% lower ownership costs than lithium-based storage solutions.
The company has already deployed highly-effective energy storage solutions for PSEG, Duke Energy, SDG&E, and SoftBank. More importantly, it’s pipeline includes over 130 potential customers with potential order volumes in the billions-of-dollars range.
Things are just getting started here…
Over the next decade, I fully expect lithium supply shortages to create a shift in demand towards zinc-based energy storage solutions, at the same time that these solutions start to become globally ubiquitous.
Against that backdrop, Eos — one of the pioneers in this field — should sell a lot of storage solutions.
And as that happens, shares will soar… meaning that if you’re bullish on the energy storage megatrend, you should consider buying Eos stock today.
On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.
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