RE: RE: Full Page Ad. Nat'l Post Today.....Pt 2Meanwhile, in Europe, the recent acquisition of Cellstrom GmbH, another VRFB manufacturer based in Austria, by German conglomerate Gildemeister GmbH, underlines the recognition by global corporations of the growing importance of energy storage. Since 2008, Cellstrom has successfully marketed VRFBs throughout Europe and most recently in India, where they are installed as back-up systems for factories in regions frequently hit by power outages.
The U.S. Department of Energy (DoE) has identified VRFBs as a leading solution for storing renewable energy. They are currently conducting a smart grid regional demonstration program with field research for the VRFB in the city of Painesville, Ohio, in conjunction with state and local power authorities. “This project will help ensure that residents and businesses in Painesville have access to a safe, secure and stable power supply,” Ohio Gov. Ted Strickland said.
Vanadium is also proving to be a highly effective additive to existing batteries in small-scale applications. In the case of electric cars, vanadium is being combined with lithium to act as a “supercharger” that increases the battery’s energy density and, hence, the distance a car can travel.
Clean technologies and materials analyst, Jon Hykawy of Byron Capital Markets, sees a new fork in the road: “Vanadium is the best cathode material that can be used in these automobiles. And we’re starting to see that conjecture being borne out by the battery industry, which is looking at lithium-vanadium-phosphate cathodes as one of the more important drivers for a higher-power, and, potentially, a much less expensive battery for the automotive industry.”
Germany’s DBM Energy recently made headlines with its testing of a lithium-vanadium polymer battery. Refitted into an Audi A2 electric car, the result was the setting of a new distance world record, with the car driving over 600 km on a single charge. Even more impressive, DBM Energy says the battery shows 97% efficiency and can be recharged in as fast as six minutes using any standard electrical socket.
By comparison, the 2011 Chevy Volt can only travel 56 km on its lithium-ion battery alone until its range extender kicks in, with a 10-hour recharge cycle. Along with DBM, a host of other companies including China’s BYD Auto Co., Japan’s GS Yuasa Corp., Japan’s Subaru and U.S.A.’s Valence Technologies, have vanadium-based batteries either in development or in plans for production.
The question is with growing acceptance for vanadium usage in cars and energy storage solutions, what is holding the technology back from mass adoption?
Martha Schreiber, chief operating officer of Cellstrom GmbH, pins it down to a combination of price and legal issues: “The highly volatile price of vanadium makes it very difficult to calculate stable price conditions, not only for manufacturers but for the end consumer as well. Moreover, this leads to a very conservative pricing policy by manufacturers to the detriment of massmarket penetration. The technology for VRFBs has also been blocked by original patents dating back to 1987. It has only been since their expiry in 2007 that has allowed companies to openly develop the technology.”
These emerging energy storage technologies require a high-purity form of vanadium called V2O5 (vanadium pentoxide). And the amount a single VRFB requires is massive: anywhere from one to five tonnes each. Today, the current value of steel-grade V2O5 is around $7 per pound and expected to increase, while battery manufacturers are paying anywhere between $10 to $30 per pound for battery-grade V2O5.
On the strength of the steel industry alone, vanadium demand is growing at 7% annually and predicted to outpace global supplies by 2012. Analysts firmly believe that vanadium demand will significantly increase over the coming years but they are less able to confidently predict that supply can keep up with demand. China is currently the world’s largest exporter and consumer of vanadium, followed by South Africa and Russia.
With very few primary mines coming on line in the next decade, this leads to a delicate balancing act where supply can keep pace only if all junior projects reach market and none are delayed.
The crux is that the VRFB can only be developed to its full potential once the global supply and pricing of V2O5 is stabilized.
One project is set to accomplish just that: The aptly named Green Giant vanadium project in Madagascar is an initiative of Toronto-based mining company Energizer Resources (TSX. V: EGZ) and is singularly positioned to supply battery-grade V2O5 in sufficient quantity to meet the surge in demand.
The Green Giant vanadium deposit is a sedimentary-hosted deposit, allowing for relatively easy extraction, which makes it unique among the world’s known deposits. The company just released an updated and expanded National Instrument 43-101 compliant resource estimate of 59 million tonnes, making it the third largest known vanadium deposit in the world. And the resource has excellent potential to expand even further: 75% of its 21-km (18-mile) vanadium trend remains open for drilling.
Energizer Resources has assembled a management team with the necessary experience and networks to develop the Green Giant project. Led by president and chief operating officer, Julie Lee Harrs, a seasoned mining executive formerly with Vale Inco and Sherritt International, Energizer is at the cusp of playing an integral part in renewable energy’s storage solution. Ms. Lee Harrs recognizes the scale of the opportunity: “Energizer is positioning itself to be the largest supplier of battery-grade V2O5 in the world — while at the same time being able to accommodate the growing demand from the steel market. The Green Giant has incredible scalability to be able to meet the demands of both industries and ramp up as necessary.”
Energizer Resources is further supported by an impressive group of directors and consultants including Richard Quesnel, Brian Tobin, Peter Harder and Howard Balloch, who offer extensive mining, political and governmental experience. Not to mention DRA Mineral Projects, a leading mine engineering and construction company based in South Africa, who will lead the development of the Green Giant project.
Energizer’s Green Giant is positioned to be the only mining operation capable of economically supplying battery-grade V2O5, while at the same time bringing the necessary stability of supply and price to the vanadium market.
When Piper Jaffray projects a $600-billion market for energy storage solutions, there’s little doubt the future will be battery powered. Energy industry analyst Nick Hodge agrees: “With that kind of anticipated spending, you should seriously start thinking about allocating a portion of your portfolio to energy storage companies.”
In the race to build a better battery, it makes equal sense to consider investing in the resource companies that will provide the raw materials for these energy storage manufacturers.
In that respect, it’s hard not to go with a company like Energizer Resources — because when it comes to vanadium and the power to release its massive energy potential, Energizer holds the key.