Battery Metals: AVL subsidiary VSUN just sold its second vanadium battery in two months
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Australian Vanadium (ASX:AVL) has sold another vanadium battery energy storage system through its subsidiary, VSUN Energy.
VSUN Energy will install a 80kW/320kWh battery (also called a VRFB) at a dairy farm in Meredith, Victoria which follows the sale of a 20kW/80kWh energy storage battery to an orchard in Packenham (also Victoria) in early September.
The same month, VSUN applied for a WA government grant to fund a vanadium-led renewable energy solution at Strelley Community School in the Pilbara region.
VSUN business development manager Sam McGahan told Stockhead that the company is only making small margins on the batteries at the moment, but this would grow as the volume of sales increased.
“We are seeing increased interest from the agricultural sector and remote communities,” McGahan says.
“For anyone who’s reliant on diesel, vanadium redox flow batteries are a great way to reduce diesel costs, reduce the impact of the noise of generators (this applies particularly to mining camps) and reduce emissions.
“It is a very large market in Australia.”
Explorer AVL, which has taken a hammering over the past 12 months, was up 10 per cent to 1.1c per share in morning trade.
This dairy farming project once again confirmed the strength of VRFBs for the agricultural sector, Australian Vanadium managing director Vincent Algar says.
“Delivering reliable power generated from renewable sources in a long-life and non-flammable battery provides increased energy security,” he says.
Algar says the goal of VSUN Energy is to grow battery demand to ensure that the market for vanadium isn’t purely driven by steel.
Current global V2O5 production is just ~140,000t a year total, and most of that goes into steel to make it stronger.
“Having two markets to supply means that there is a floor to the price, reducing the commodity’s volatility,” Algar says.
It’s generally accepted that the safer, longer lasting and recyclable vanadium batteries are better suited for large stationary storage than lithium-ion.
The biggest barrier to uptake recently has been V2O5 cost — but current prices around $US10/lb could help the fledgling industry build momentum.
A burgeoning battery sector is important to the success of emerging low cost producers like Vanadium Resources (ASX:VR8), Australian Vanadium (ASX:AVL) or Technology Metals Australia ASX:TMT). That’s because these batteries soak up an enormous amount of V2O5.