Two prominent goals of the Murphy administration – fostering innovation and reducing the state’s reliance on fossil fuels – create opportunities for a variety of manufacturers. NJBIZ recently spoke with the leaders of companies taking advantage of those opportunities.
First up is Joe Mastrangelo, the chief executive officer of Edison-based Eos Energy Storage, which is developing an improved system – that is cleaner and cheaper than lithium ion batteries – for holding power generate from renewable sources. Then, we talked to Michael Stivala, the CEO of Suburban Propane in Whippany, which recently took a stake in Oberon Fuels, a California company working on an alternative fuel for vehicles and other equipment. Oberon CEO Rebecca Boudreaux joined that conversation.
Excerpts of those discussions follow. The interviews have been edited for length and clarity. Watch videos of the full discussions here.
Joe Mastrangelo, CEO of Eos Energy Storage
NJBIZ: What’s wrong with lithium ion batteries? Why do we need an alternative?
Joe Mastrangelo: It’s not that there’s anything wrong. But I think when, when you look at the energy landscape, you always need a mix of technology. So lithium ion is a great technology for electric vehicles. It’s a great technology if you want short bursts of power.
What we’ve developed, though, is a technology that can do long duration discharge and operate in harsh environ-ments. We can go anywhere from Minus 13 degrees to plus 50 degrees without any heating or air conditioning being required.
Q. And that’s a shortcoming of lithium batteries.
A. Lithium ion needs to operate, usually within a range of 18 to 22 degrees. And if you go outside that you can damage your system, whereas our system has operating flexibility to allow you to operate in the largest harshest environments around the world.
Q. All right, your batteries use zinc. Is there a different process that you use to build them? How exactly are they different besides just the material?
A. The battery in and of itself comes from five core commodities so readily available. … our manufacturing process is relatively simple – requires a lot of precision. But doesn’t require expensive clean rooms to be able to manufacture batteries, like you see with lithium ion technology and at the same time, we have no conflict materials. There’s no precious metals, the batteries are non-toxic and fully recyclable. So it’s just a different chemistry. And surrounded by a simpler mechanical design that gives you the operating flexibility for stationary storage.
Q. It sounds like it must be significantly cheaper or less expensive to build, to buy and to use.
A. When you think about just the cost of initial purchase, we’re on par with lithium ion with very low volumes. … We think we create a capital costs or initial cost advantage from an operating standpoint because the system doesn’t require the HVAC and because you have a wider operating range it becomes a lower cost, easier system to operate out in the field. … And you have a longer life cycle with the battery, because our life cycle is 15 to 20 years without with minimal degradation so it gives you a longer life solution.
The Eos Energy Storage CEO talks about power technology, the market for renewable energy and the company’s planned Nasdaq listing.
Q. And where are you in production? Are you are you turning these things out, selling them, they’re being installed? How big is the market?
A. Our headquarters in Edison, N.J., where we do all of our testing and R&D work.
We have eight systems installed around the world. We’ve got six of them in the U.S. and two outside of the United States. We’ve started what we call our gen 2.3 product which is which is a new product. We’re 100 percent made in America and 80 percent of our materials come from the U.S. Our factory is in Pittsburgh, Pa. We moved into this factory almost a year ago to the day. So even with COVID and all the restrictions and downtime that we’ve had, we’ve gone from an empty building in an old Westinghouse factory to producing batteries and wrapping up production and our first system commercial system will ship later this fall.
Q. How much power do these things store does it eventually go to businesses to residences, things like that— the same electrical grid that everybody else uses?
A. You could make a residential system. We don’t have that available right now, just because of where we are in our development cycle from a solution standpoint. But we do 20-foot standard shipping containers. We put two of those together, no 40-foot solution which gives you a little bit under a megawatt of power. You can scale those up to as big as you need, or because of the safety measures because our battery is not flammable you can put them in a standard warehouse with ventilation and put them on server racks and stack the batteries and create what we call a power warehouse.
Q. That was the next question. Beyond supplying electricity for everybody, are there other uses? Can they be smaller, bigger? What is the range that we’re talking about in terms of the kinds of of uses that these can be put to?
A. When the company started the goal was to co-locate this with solar. So what you were trying to do with solar is take the daytime solar and shift it into a battery that can discharge over four hours when the sun goes down. Since we’ve been operating, we found that we can do almost any application that requires two hours to 10 hours. So we do things like grid decongestion, where you’re storing you’re not next to a power source, but you’re pulling power off the grid when there’s no demand and putting it back on when there is demand. We do applications where we co-locate with factories or commercial parks or office buildings to be able to provide power and right now we’re pretty excited about that.
Michael Stivala, CEO of Suburban Propane and Rebecca Boudreaux, CEO of Oberon Fuels
NJBIZ: How did a company based in Whippany find a company based in San Diego? How did you get together?
Michael Stivala: Well, actually, … our headquarters is here in New Jersey and the business was founded – the whole industry was founded in 1928 in West Orange, N.J., a couple miles from our office here – we are in 41 states and we serve a million customers around the country. And we’re actually quite large in California, which is where Rebecca and Oberon fuels are headquartered down in San Diego. So all that being said, we wound up meeting at a conference in Washington, D.C. focused on innovation in the propane industry.
Q. And Rebecca your company, as I understand it, what you are developing is a replacement or alternative to diesel fuel, is that correct?
Rebecca Boudreaux: So what we’re making is a molecule called DME. Yes it is a diesel replacement. But it’s more than that. It’s a molecule that can be used three different ways. [It is] oxygen, carbon, hydrogen. [But] because there’s no direct bond between the two carbons, when it combusts in a diesel engine there’s no soot. So it is an excellent diesel replacement—cleaner burning that gives you the power and torque in the diesel engine.
It also looks very similar propane, the difference is propane has a carbon … two hydrogens and and an oxygen, so it blends very well, very similar to propane. … Hence, the synergy with Suburban Propane and the infrastructure they have.
It’s also an excellent hydrogen carrier. … It’s really hard to move hydrogen when it’s separated attach it to the DME molecule it’s very easy to move. So it’s a molecule that can be used in three different ways.
Q. And Michael. How then would Suburban Propane use this molecule? What do you think you’re going to get out of it?
Stivala: Traditional propane is already a very clean burning fuel, it’s got much better qualities than gasoline and diesel for the transportation sector. It produces 60 to 70 percent less smog-producing hydrocarbons than gas and diesel in over-the-road vehicles so propane as it as it as a story today is a low-carbon fuel. One of one of our strategies is to continue to get that story out there and advocate for propane being recognized for its clean burning qualities in the conversation in those areas where lower carbon emissions is the goal and the appropriate goal to improve air quality. And climate change.
So what suburban has been working on is the next innovation to bring an even cleaner version of our product to the market. By taking what Oberon is producing and working on and blending it with propane.
The California Air Resources Board has already weighed in on the carbon intensity impact of that blend and the goal is to significantly reduce the carbon intensity of traditional propane with a 20 percent blend of renewable DME, which could bring us closer to almost carbon neutral, which would obviously achieve the targets that certainly California has set for itself and lots of other states in the union are already starting to push for.
Q. So Rebecca, tell me about the reception you’re getting in California to this, both from regulators and from potential customers. What are folks saying to you?
The CEOs of Suburban Propane and Oberon Fuels discuss their companies’ green energy partnership.
Boudreaux: The company started on this 10 years ago and we approached the state of California because there were no regulations on DME as a fuel, no one had done it before. So the challenge is, there wasn’t a pathway for a new fuel to get certified by the state of California.
And so for almost a decade we’ve been working closely with them because they also had to think outside the box of how they deal with innovation in the regulatory space. And we’ve worked very closely with California Air Resources Board, The California Department of Agriculture, specifically their division of measurement standards, to create the record to-ward a framework for DME fuel.
And the reception that we received there was signified by the California Energy Commission in 2019 awarding us a $2.9 million grant to upgrade our pilot DME production facility to demonstration scale. … to test the renewable DME we will be producing there in propane blending and using it in vehicles on the road. So that project is ongoing right now and we’re very excited about that.
Q: And Mike are you considering more acquisitions along these lines? I know the company does have a program related to that, so how does it fit with your long-term planning?
Stivala: About a year and a half ago we launched what we call Go Green with Suburban Propane, which had two tenets to it. One is advocacy work to get the word out about propane, as it is today because I can be somewhat or forgotten source of energy. … The second tenet is that if you say that, you have to be willing to innovate, have to be willing to in-vest in the next wave of innovative solutions to further reduce the carbon intensity of the product we love so much here at Suburban Propane. … And so, yes, we’re trying to be the pioneer in our industry.