Eco Investor December 2015

Pre-Profit Securities

RedFlow Targets Miners and Householders

Energy storage maker RedFlow has urged mining companies to look at deploying renewable energy with on-site power storage to cut their energy costs at remote sites, particularly now that commodity prices and mining revenue have fallen.

The recent world agreement at the Paris UN Climate Change Conference also makes this a practical way in which mining companies can help to reduce emissions.

Chief executive Stuart Smith said a large-scale battery utilized in conjunction with solar energy can reduce or remove the use of diesel generators and assist miners to drive down their energy expenditure. "Energy storage systems alongside solar arrays can deliver significant cost savings when compared with the infrastructure costs of setting up gas reticulation or using diesel generators, especially the cost of fuel when mine sites are not grid-connected."

In a paper on the topic, RedFlow examples pioneering projects such as the DeGrussa Sandfire mine, 900 kilometres north-east of Perth, which is investing $40 million to construct a 10.6 megawatt (MW) solar power station by 2016. It also cites Rio Tinto, which is deploying 6.7 MW of solar photovoltaic cells for an off-grid mine, township and port to support its bauxite mining at Weipa in north Queensland. Rio Tinto is now adding integrated energy storage to reduce diesel use.

Brisbane-based RedFlow has built energy storage battery systems for harsh conditions such as mine sites and these do not need active cooling and can operate in temperatures as hot as 50 degrees. The batteries come with a 10 year guarantee.

RedFlow's LSB (Large Scale Battery) is a 20-foot shipping container with up to 60 flow batteries. It can store up to 660 kilowatt hours (kWh) of energy. The zinc bromide chemistry means the batteries can discharge 100 per cent of their energy capacity each day.

Commercialization of the LSB should be helped with an agreement with Queensland's Ergon Energy to establish an on-grid demonstration of the energy storage system integrated with a community scale solar PV. The system will produce 100kW and 480kWh of energy and should be delivered to Ergon this month.

Ergon Energy supplies electricity to customers across 97 per cent of Queensland including coastal, rural, remote and outback centres. A successful demonstration could open many doors.

Meanwhile, RedFlow continues to receive inquiries about its battery for the residential market, which it aims to enter by the end of the first quarter 2016 when it expects to have its battery management system ready. At this point RedFlow will offer shareholders a discount on the system.

Overall, commercial sector sales have been slow but are picking up, said Mr Smith. The company is receiving small commercial orders and these are for operational deployment and not just requests for trials.

RedFlow now has over 165 batteries in the field or being delivered, and it expects to deliver another 130 in the March quarter 2016. These are separate from the 60 batteries in the containerized large scale battery purchased by RedFlow's executive chairman, Simon Hackett, and which will be delivered early next year.

2016 looks set to be a key year for the energy storage sector with many new battery systems about to come to market in Australia. RedFlow looks like it could be competitive across the big sectors of residential, commercial and mining. (ASX: RFX)

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