e-based company SustainX has received $14.4 million from GE Energy Financial Services, a unit of GE (NYSE: GE), and other investors to continue developing its technology for energy storage using compressed air. Through the GE Ecomagination Challenge’s “Powering the Grid” program, in which SustainX is a partner, GE Energy Financial Services joins Cadent Energy Partners and prior investors Polaris Ventures and Rockport Capital in the new round of venture financing. The GE Ecomagination Challenge demonstrates GE’s global commitment to accelerate the development and deployment of innovative power-grid technologies through open collaboration, while providing financial support to develop and commercialize innovative technologies.
“SustainX has set a remarkable pace in developing its product and establishing joint ventures to aid in the commercial production of its energy storage units. We look forward to participating in its continued success.”
Details of the financing were not disclosed. A total of $5.4 million in earlier financing for SustainX came from the Small Business Innovation Research program of the National Science Foundation and from the Energy Storage Program of the US Department of Energy. AES Energy Storage, LLC is working with SustainX to demonstrate a full-size system in the field, capable of storing enough energy to power 1,000 typical US homes.
GE Energy Financial Services’ investment in SustainX reflects its commitment to enabling technology innovation by providing not only capital but technology evaluation and potential commercial opportunities with GE, particularly to develop a smarter power grid. The investment is based partly on GE Global Research’s evaluation of SustainX’s technology.
“GE’s backing, alongside that of other investors and the federal government, validates our efforts to develop and commercialize a cost-effective, grid-scale energy storage solution,” said Thomas Zarrella, CEO of SustainX. “We are on schedule to develop a grid-scale prototype to be demonstrated at an affiliated AES site where we can showcase our transformative energy storage technology.”
The present round of funding for SustainX represents the first time that both GE and Cadent Energy Partners have invested in the growing company. “We are pleased to be an investor in SustainX as we believe this company’s energy storage solution has a global market with enormous potential,” said Paul McDermott, Managing Partner of Cadent Energy Partners. McDermott continued, “SustainX has set a remarkable pace in developing its product and establishing joint ventures to aid in the commercial production of its energy storage units. We look forward to participating in its continued success.”
To store energy, SustainX compresses air by using electricity to drive pistons inside cylinders. The resulting high-pressure air is stored in above-ground vessels. To release energy later, the system uses stored air to drive the same pistons, which in turn drive an electric generator. SustainX technology keeps air at a nearly constant temperature during compression and expansion; this significantly improves efficiency and reduces the cost of compressed-air energy storage below that of other above-ground energy-storage options.
Independent experts estimate that the market for grid-scale energy storage will be $18 billion by 2015. Storage can improve the economics of wind and solar power, improve grid stability, store off-peak energy to be used during on-peak periods, improve the feasibility of microgrids in rural areas, and reduce emissions from the gas-turbine peaker plants presently used to keep electric supply precisely matched with demand.
