Largest Project to Date Wins CEC Funding

RNS Number : 7229C

Invinity Energy Systems PLC

13 October 2022

 

The information contained within this Announcement is deemed by Invinity Energy Systems plc to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of UK law by virtue of the European Union (Withdrawal) Act 2018 ("MAR").

13 October 2022

Invinity Energy Systems plc

("Invinity" or the "Company")

Largest Project to Date Wins CEC Funding

Funding approved for 10 MWh California project and update on current trading

Invinity Energy Systems plc (AIM: IES) (AQSE: IES) (OTCQX: IESVF), a leading global manufacturer of utility-grade energy storage , today announced that it is part of a consortium led by Indian Energy LLC ("Indian Energy") developing a solar-plus-storage microgrid project, that will include a large vanadium flow battery system, under the California Energy Commission's ("CEC" or "the Commission") Long-Duration Energy Storage Program.

In the CEC's business meeting on 12 October 2022, the Commission approved funding for the hybrid, non-lithium battery project for the Viejas Band of Kumeyaay Indians which is scheduled to include the Company's largest system to date, a 10 MWh Invinity vanadium flow battery. Subject to execution of a sales contract between Invinity and Indian Energy, to be announced in due course by the Company, the project is expected to be delivered to the site in Southern California in 2023 and to generate Investment Tax Credits (ITCs) for the project owner under the Inflation Reduction Act.

In connection with this event, the Company is pleased to provide the following trading update.

Pipeline Sales Progress

The Company is pleased to note two sales reflecting a total of 2.1 MWh of the Company's products have closed since pipeline figures were reported on 29 September. The 0.8 MWh sale to Equans Belux in Belgium progressed directly from the Advanced category to Closed. The 1.3 MWh sale to Kinetic Solutions in Arizona was previously reported within the Base category. Upon signing of the 10 MWh CEC-funded Indian Energy contract, this would move that deal from Base to Closed.

The Company is continuing its focus on closing late-stage sales and hopes to announce further deals before year end.

Sales Backlog Conversion

Invinity continues to make significant progress on the delivery of batteries against its order backlog from previously announced sales contracts. Final assembly of batteries for the Yadlamalka project is in progress with first shipments to the project site in Australia underway. Batteries for the Elemental project are awaiting a component whose delivery was delayed by supply chain disruptions but that is now expected to be delivered within weeks. Given the above progress, Management currently believes the Company is on track to deliver these projects as per guidance within its Interim Results (announced on 29 September) subject to suitable logistics arrangements and customer sites being ready to receive and accept battery shipments.

Siemens Gamesa Progress

Invinity continues to advance the joint development of our next-generation flow battery, known as 'Project Mistral', with Gamesa Electric and Siemens Gamesa Renewable Energy. The joint development programme is being executed in several stages, and progress through the milestones that mark those stages has recently been reviewed and confirmed by the parties involved. Once at commercial launch, Mistral is expected to demonstrate the size, scale and economics needed for a compelling alternative to lithium batteries which are subject to increasing concern about safety and supply.

Financial

By closing near-term sales, shipping backlog from inventory and carefully managing cash flows, the Board believes the Company's cash position remains appropriately managed and therefore is not currently looking to existing shareholders for additional funding. The Company continues to be mindful of current market conditions and continues to discuss opportunities to partner with other companies that have strategic, and in some cases, potential direct economic value.

Corporate & Strategic

The Company is pleased to note that recently announced U.S. projects will generate Investment Tax Credits (ITCs) under the U.S. Inflation Reduction Act improving project economics for Invinity's customers. This reinforces the Company's U.S. strategy and the strategic value of the Company's memorandum of understanding with Arkansas-based U.S. Vanadium, which, once converted into a formal agreement and supply arrangement, is expected to see Invinity's products additionally qualify for Production Tax Credits (PTCs), further enhancing the competitiveness of the Company's products in the burgeoning U.S. energy storage market.

Finally, the Company is pleased to report that with many recent projects incorporating the Company's VS3 products now installed and operational, it has engaged with a widely recognized global renewable energy technical consultancy, to review the operation of those projects and report on their performance. The Company plans to publish this report, which is expected to materially accelerate the due diligence process for Invinity's future customers, before the end of the year.

Larry Zulch, Chief Executive Officer at Invinity said:

"The last few weeks have made visible just some of the progress Invinity has been making internally in the year to date. I'm delighted that our efforts in the European markets are being rewarded by a sale to Equans, now part of Bouygues and a global leader in multi-technical services. We have been working for some time with the California Energy Commission and are looking forward to concluding the contract for what we expect at delivery will be North America's - and Invinity's - largest flow battery. We see big opportunities in projects assisted by the U.S. Inflation Reduction Act, such as the sale to Kinetic Solutions in Arizona, and ongoing lithium-ion battery supply and safety issues are increasing interest in proven alternatives. Invinity has a clear path to profitability and we are marching that path with confidence and determination."

Enquiries :

Invinity Energy Systems plc	[phone]
Jonathan Marren, Chief Development Officer and Interim CFO Joe Worthington, Director of Communications
Canaccord Genuity (Nominated Adviser and Joint Broker)	[phone]
Henry Fitzgerald-O'Connor / Gordon Hamilton
VSA Capital (Financial Adviser and Joint Broker)	[phone]
Andrew Monk / Simon Barton
EAS Advisors LLC (US Corporate Advisor)	[phone]
Matthew Bonner / Chris Chesworth

Notes to Editors

Invinity Energy Systems plc (AIM: IES) (AQSE: IES) (OTCQX: IESVF) manufactures vanadium flow batteries for large-scale, high-throughput energy storage requirements of business, industry and electrical networks.

Invinity's factory-built flow batteries run continually with no degradation for over 25 years, making them suitable for the most demanding applications in renewable energy production. Energy storage systems based on Invinity's batteries are safe, reliable, and economical, and range in size from less than 250 kilowatt-hours to tens of megawatt-hours.

Invinity was created in April 2020 through the merger of two flow battery industry leaders: redT energy plc and Avalon Battery Corporation. With over 33 MWh of systems deployed to date across more than 50 sites in 15 countries, Invinity is active in all major global energy storage markets and has operations in the UK, Canada, USA, China and Australia. Invinity Energy Systems plc is listed on the AIM Market of the London Stock Exchange and on the Aquis Stock Exchange (AQSE). The Company trades in the USA on OTCQX Best Market under the symbol "IESVF".

To find out more, visit invinity.com or call Investor Relations on [phone].

 

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