Altech Batteries’ (ASX: ATC) quarterly wrap: CERENERGY® Battery Project shows promise

Highlights

• Significant progress reported with two 60kWh CERENERGY^® battery pack prototypes.
• Finalisation of prototypes is expected by mid-2024.
• The DFS for CERENERGY^® battery project indicated positive financial metrics, including an NPV of EUR169 million and an internal rate of return (IRR) of 19%.

Altech Batteries Limited (ASX: ATC, FRA: A3Y) has provided a quarterly update on its CERENERGY® Battery Project, showcasing significant advancements and positive project economics.

The company made excellent progress in the development of its ABS60 60kWh CERENERGY^® battery prototypes in the March quarter. Additionally, the company announced encouraging findings from a Definitive Feasibility Study (DFS) undertaken for the CERENERGY^® battery project.  

Excellent Progress on CERENERGY^® Battery Prototypes  

During the three-month period, the company marked significant progress across its ABS60 60kWh CERENERGY battery prototypes. Last year, the company started manufacturing of two units focused on customer performance testing. Initially, Fraunhofer IKTS, a joint venture (JV) partner of ATC, developed battery packs with 5 kWh and 10 kWh units’ capacity. After the JV with ATC, the battery pack transformed into a 60kWh unit, developed especially for the grid storage market.

The pilot line at Fraunhofer IKTS, located in Germany, has been redesigned for producing 60 kWh battery prototypes. The company informed that all materials required for prototype have been sourced from selected suppliers. Currently, half of the required cells have been manufactured. The rates of rejection or defects have stayed minimal and within the anticipated boundaries.

After the finalisation of all cells, ATC plans to initiate the assembly of cells into the battery housing. It is expected by mid-2024.

Encouraging DFS results for CERENERGY^® project

The period saw release of results of the DFS undertaken for a CERENERGY^® project with a capacity of 120 1MWh GridPacks, every year, intended to be built on ATC’s land in Germany.

The study highlighted encouraging project metrics. With a capital cost of €156 million, net present value (NPV) stands at EUR169 million (NPV₉) and expected net cash flow stands at EUR51 million annually from operations. The estimated IRR is 19% and expected capital payback period is 3.7 years.

At full production capacity, the expected revenue amounts to EUR106 million per annum and expected EBITDA is EUR51 million, with a 47% margin.

The company has launched a share purchase plan to raise up to AU$5 million to advance its projects.  

ATC shares traded at AU$0.062 apiece on 03 May 2024.