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Altech Batteries Limited (Altech/the Company) (ASX: ATC and FRA: A3Y) is pleased to announce the excellent results from a Definitive Feasibility Study (DFS) conducted for a CERENERGY® project with an annual capacity of 120 1MWh GridPacks each year, planned for construction on Altech’s land in Saxony, Germany. The project is being developed by Altech Batteries GmbH (ABG) (75%) and joint venture partner Fraunhofer IKTS (“Fraunhofer”) (25%), an incorporated society affiliated with the German government and partially financed by the German federal government. Altech Batteries GmbH (ABG) is owned 75% by Altech Batteries Limited (listed on ASX:ATC) and Altech Advanced Materials AG (listed on FSE:AMA).
Highlights
- Highly positive Definitive Feasibility Study (DFS) – 120 GridPacks (1MWh) pa
- Capital cost estimated at €156 million with excellent project economics
- Pre-tax Net Present Value (NPV9) of €169 million
- Attractive Internal Rate of Return (IRR) of 19%
- Steady state payback period is 3.7 years, with Annual Revenue of €106 million per annum
- EBITDA of €51 million or margin of around 47%
- Altech Board Decision to Proceed to Funding Phase
- Low lifetime levelised cost of storage €0.06/kWh vs lithium-ion batteries at €0.149/kWh
- Grid energy storage market projected to grow by 28% CAGR
- Grant funding applications underway
- Equity and mezzanine financing discussions in progress
- Offtake for 5 years production in progress
EXCELLENT PROJECT ECONOMICS
With a conservative investment estimate of €156 million, Altech's DFS not only demonstrates an excellent net present value (NPV) of €169 million (NPV9) but also generates a significant net cash flow of €51 million annually from operations. The estimated internal rate of return is 19%, ensuring a capital steady state payback in just 3.7 years. At full production capacity of 120 1MWh GridPacks, the anticipated annual revenue is €106 million. With an EBITDA of €51 million (margin of 47%), the project economics is compelling, even at this relatively small first production line capacity. With the anticipated growth of the grid storage market at 28% CAGR, Altech’s Board and joint venture partners have enthusiastically given the green light to proceed to the funding phase (Final Investment Decision) for this exciting project.
Watch video of Cerenergy Battery DFS Announcement https://youtu.be/LLb6DxlHTws
Watch Video Cerenergy DFS Ann
PROJECT OWNERSHIP STRUCTURE
In September 2022, comprehensive joint venture agreements were executed, marking the commencement of design works. Notably, a fully joint and several joint venture (JV) was established, consolidating all rights and know-how between the Fraunhofer-Gesellschaft, represented by the Institute for Ceramic Technologies and Systems (IKTS), and Altech Energy Holdings GmbH (AEH). This collaborative effort led to the creation of Altech Batteries GmbH (ABG) with 75% ownership by AEH and 25% by Fraunhofer Gesellschaft. AEH, in turn, is 75% owned by Altech Batteries Limited (ASX:ATC) in Perth, Australia, and 25% by Altech Advanced Materials AG (AMA) in Heidelberg, Germany - both publicly listed companies contributing to project funding.
FRAUNHOFER IKTS BACKGROUND
Fraunhofer, based in Germany, is the world’s leading applied research organisation. Prioritising key future- relevant technologies and commercialising its technology in business and industry, it plays a major role in the innovation process. Founded in 1949, Fraunhofer currently operates 76 institutes and research units with over 30,000 employees throughout Germany. Fraunhofer Institute for Ceramic Technologies and Systems (IKTS) is one of the 76 institutes that conducts applied research on high-performance ceramics. The Institute‘s three sites in Dresden and Hermsdorf (Thuringia), Germany, collectively represent Europe‘s largest R&D institute dedicated to the study of ceramics. The annual budget of IKTS is €83 million and it has 800 employees. As a research and technology service provider, Fraunhofer IKTS develops advanced high-performance ceramic materials, industrial manufacturing processes as well as prototype components and systems in complete production lines up to the pilot-plant scale. The electrolyte within the CERENERGY® battery is a ceramic product manufactured from alumina.
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