Aug 15, 2019

SoftBank bets $110 million on energy storage startup Energy Vault

Softbank Group Chairman Masayoshi Son Press Conference

SoftBank Group Corp. Chairman and CEO Masayoshi Son. Photo: Tomohiro Ohsumi/Getty Images

Late Wednesday brought word that investment giant SoftBank Vision Fund was pouring $110 million into Energy Vault, a startup with new technology for long-duration energy storage.

Why it matters: It's the first investment by the Vision Fund in the energy storage space. (It has staked Uber, Slack and other well-known companies.)

  • And it's notable for what it's not — money for a battery technology company.
  • Instead, it's for a firm with a new tech (using old concepts) that will need lots of capital to scale and compete with other emerging techniques.

The big picture: Per Quartz's Akshat Rathi, "[I]t’s an unusually large sum for a company that hasn’t even existed for two years or built a full-scale prototype."

  • He also notes that SoftBank's interest in energy storage is "signaling to the wider market that this area of technology is ripe for large investments."
  • Andreas Hansson, a partner with SoftBank Investment Advisers, is joining Energy Vault's board.

How it works: The Swiss startup has developed a new method for long-duration storage — something that's important for enabling very high levels of intermittent renewables on power grids.

  • It's conceptually similar to pumped-hydro storage, but instead involves 35-ton composite bricks stacked into a large tower controlled via software by a crane system.
  • "Bricks are then returned to the ground and the kinetic energy generated from the falling brick is turned back into electricity," their website notes. Check out a company-produced simulation here.
  • The company says it can provide storage at lower cost than hydro-based systems and without the need for specific topographies.

What they're saying: “If you look at a lot of the estimates in the world for what energy storage investment is going to look like over the next 10-20-30 years, the numbers are anywhere from $300 billion to $600 billion,” Energy Vault CEO Robert Piconi tells CNBC.

  • “Everyone understands the need to get storage to make renewables much more efficient and to reduce our [reliance] on fossil fuels,” he said.

What's next: Tests of whether and how fast the company can move beyond the small prototype phase. Quartz reports the investment will help build full-scale prototypes in Italy and India and then 35 MWh-capacity multiple towers for customers "soon after."

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