The cash injection is Connected’s second in two years. Engie and Macquarie invested £3m last year in the Newcastle-on-Tyne-based firm, which takes second hand battery packs from Renault electric vehicles, to create storage systems ranging from 60kWs to megawatts.
CEO Matthew Lumsden told delegates at The Energyst event last year that the systems can be used more extensively than allowed under warranties for some new batteries, which means operators can push them harder to maximise revenues. He suggested that could deliver higher yields even if it meant replacing cells earlier.
In a statement announcing the new investment, Lumsden said the company would use the cash to expand. “The time is now right for us to scale up the business and the investment will enable us to do so. We have some exciting times and projects ahead of us and look forward to further capturing the benefits of the circular economy.”
Shingo Hosotani, of Sumitomo Corporation Europe, said secondary use of electric vehicle batteries was a “key focus” of the company’s ambitions within the “broad value chain” of electric vehicles. “By collaborating with Connected Energy, we expect to create the new business between mobility sector and energy sector.”
He said the corporation will continue to invest “in companies with innovative technology.”
Hendrik Van Asbroeck, MD of Engie New Ventures, said Connected Energy’s “specific know how on second life batteries enables Engie [to] access new types of storage projects. This investment is a further confirmation of the exciting opportunity to develop new business opportunities together.”
Matthew Booth, of Macquarie’s Commodities and Global Markets Group, said the group would harness market knowledge to “help Connected Energy realise its potential, helping energy companies and EV manufacturers alike capture the value in second life EV batteries and delivering sustainable low-cost energy storage.”
Lumsden said Connected Energy is building out a pipeline of larger UK projects, and has a 1.2MW project underway in Belgium. The company has installed 11 of its E-STOR systems to date.