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VSA CAPITAL MARKET MOVERS - redT energy

Published: 10:13 19 Nov 2018 GMT

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VSA Morning Alternative Energy Comment, 19/11/18

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redT#: Australian Project Now Operational

redT energy (RED LN)#, an energy storage solutions company, has announced that its 1MWh hybrid energy storage system located on the Clayton, Victoria campus of Monash University in Australia is now operational.

  • System comprises a 900kWh vanadium flow system (12 tank unit modules) and a 120kW lithium-ion battery.

  • The system has been integrated into the campus micro-grid, which includes 1MW of solar PV generation assets as well as EV charging stations and building management systems.

  • The system is the largest behind-the-meter commercial and industrial energy storage system to be installed in Australia.  

  • The Australian energy storage market is estimated to be worth cA$30bn by 2030 with almost 400MWh of energy storage projects estimated to be installed in behind-the-meter commercial and industrial applications nationwide by 2022 according to industry consultants Delta-ee.

VSA Comment

In October 2017 RED announced this first order in the Australian market, which we estimated would deliver cUS$1m (cA$1.3m) in revenues to the company. It is therefore positive to see the project become operational a little over a year later.

The project builds on the hybrid energy storage work carried out by the company in partnership with the University of Newcastle (UK) as part of a three-year programme announced in September 2016. The basic premise of such a system is that the lithium-ion battery component provides high power, when required, over a short duration (c20% of a customer’s overall requirements) with the vanadium flow machine providing the long duration output due to its much higher energy storage capability and lack of degradation (c80% of a customer’s overall requirements).

This project will become an important marketing site for the company as it seeks further orders in an Australian market forecast for explosive growth (400 energy storage systems of this size are estimated to be installed by 2022).

We maintain our BUY recommendation and target price of 22p.


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