(Reuters) - Jostein Eikeland, a Norwegian entrepreneur with a mixed record of success, is hoping to jolt the world of energy storage.
On Tuesday, Eikeland’s latest venture, Alevo, will unveil a battery that he says will last longer and ultimately cost far less than rival technologies.
The technology, which is meant to store excess electricity generated by power plants, has been developed by Eikeland in secret for a decade.
“We’ve been very stealth,” Eikeland said in a telephone interview. “We didn’t know if we were going to succeed.”
Martigny, Switzerland-based Alevo Group is gearing up to start manufacturing batteries next year at a massive former cigarette plant near Charlotte, North Carolina, that it says will employ 2,500 people within three years.
Eikeland, 46, said Alevo, named for the inventor of the battery, Alessandro Volta, has $1 billion from anonymous Swiss investors and has taken no state funding or incentives.
Alternately brash and self-deprecating, Eikeland did not shy away from discussing his up-and-down past. He founded software company TeleComputing Inc during the dot-com boom, helped take it public on the Oslo stock exchange, then left in 2002 after the tech bubble burst.
He later invested heavily in and took the helm of Sweden-based auto parts manufacturer, TMG International, which went bankrupt in 2008. Broke, he was forced to sell his lavish homes to pay his taxes, according to media reports that were confirmed by representatives for Alevo.
After TMG, Eikeland spent a few years investing in software and battery technologies, many of which he admits failed.
“I know how hard it is to lose eight of your 10 fingers,” he said. “I wish I had somebody else to blame.”
Claims of technological breakthroughs from unfamiliar companies are common in the world of green technology. Many startups fizzle out before they achieve mass production. Among the recent high-profile flameouts: battery maker A123 and solar panel maker Solyndra.
“One billion dollars is a colossal amount of capital raised for any clean-tech company,” said Raymond James analyst Pavel Molchanov, who said he is not familiar with Alevo. “It doesn’t mean it’s going to be a smashing success.”
Typically in high-tech manufacturing, companies use pilot projects to prove their technology to investors and potential customers before ramping up. That’s not how Eikeland is proceeding.
“Building as big as we did, it might seem a little bit risky,” said Eikeland, who described himself as “a controversial guy.”
Producing on a mass scale will make Alevo’s technology cost- effective from the start, Eikeland said. The high cost of grid storage has prevented it from being deployed more widely.
Eikeland plans to deliver 200 megawatts of batteries - roughly enough to power 100,000 homes - into the U.S. market next year and is in talks with big utilities, which he hopes will become customers.
Alevo’s approach stands in stark contrast to the public announcement last month of Tesla Motors Inc’s planned $5 billion factory in Nevada, which will make batteries for electric cars. Tesla says its plant will employ 6,500 people by 2020. It will receive more than $1 billion of state incentives.
“Building a $1 billion facility in stealth mode is definitely unusual,” said Dan Reicher, executive director of the Steyer-Taylor Center for Energy Policy and Finance at Stanford University. Reicher, a former green technology investor, said he was not familiar with Alevo or its technology.
State and county officials in North Carolina confirmed that Alevo has not sought any business incentives.
The company has created what it calls GridBanks, which are shipping containers full of thousands of battery cells. Each container can deliver 2 megawatts of power, enough to power up to 1,300 homes for an hour.
The batteries use lithium iron phosphate and graphite as active materials and an inorganic electrolyte - what Eikeland called the company’s “secret sauce” - that extends longevity and reduces the risk of burning. They can be charged and discharged over 40,000 times, the company said.
That is about four times as much as rival batteries, said Sam Wilkinson, who follows energy storage for IHS Technology. Wilkinson, who said he was briefed by Alevo on its plans, said that if the batteries work as promised they will constitute a technological leap.
Grid storage has become critical as more renewables are introduced into the world’s power supply. For instance, batteries can store power generated during windy nights to use during the day when the wind may not be blowing, or can extend solar power into the hours after the sun goes down.
The industry is expected to grow to $19 billion by 2017 from just $200 million in 2012, according to research firm IHS CERA.
Eikeland holds several patents in the United States related to battery technology. The company will compete with established manufacturers like Samsung and France’s Saft as well as a handful of privately held startups like Enervault and Primus Power.
Additional reporting by Gwladys Fouche in Oslo; Editing by Eric Effron and Douglas Royalty