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  • WSJ NEWS EXCLUSIVE
Long-Duration Battery Startup Form Energy Raises $450 Million
Form Energy is accelerating development of iron-air batteries that could store clean power for several days following Inflation Reduction Act
Form Energy aims to bring down the cost of long-duration energy storage by using huge amounts of iron pellets.

Form Energy aims to bring down the cost of long-duration energy storage by using huge amounts of iron pellets. PHILIP KEITH FOR THE WALL STREET JOURNAL

By Amrith Ramkumar
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Oct. 4, 2022 6:00 am ET


A startup developing iron-air batteries that could store renewable power for several days is raising $450 million from backers including steelmaker ArcelorMittal MT 3.56%▲ SA and TPG Inc. TPG 4.39%▲
Form Energy Inc. plans to use the funds to build its first big manufacturing facility and begin selling to customers. The private funding round more than doubles the total equity Form has raised in its five-year history, company officials said.
The fundraising adds to a string of clean-energy investments following the Inflation Reduction Act, which cemented tax credits for battery storage and renewables for a decade.
Form is racing to address one of the biggest barriers to widespread deployment of wind and solar power: intermittency. Current lithium-ion battery technology is costly and can only store energy for hours. So, new approaches are needed to store and release energy during the long stretches when the wind isn’t blowing and the sun isn’t shining.
Other investors in Form’s funding round include the Canada Pension Plan Investment Board—also known as CPP Investments—Bill Gates’ Breakthrough Energy Ventures and Singapore state-owned funds GIC Pte. Ltd. and Temasek Holdings Ltd.
Based in Somerville, Mass., Form aims to slash battery prices by using huge amounts of low-cost iron pellets. The battery takes in oxygen and converts iron to rust. It then reverses the process, turning the rust back into iron and breathing out oxygen, to charge and discharge the battery.
The company is considering possible sites for a U.S. manufacturing facility and accelerating its target start date for commercial production to late 2024. That will involve mass producing its batteries and getting customer and regulatory approval for the technology.


How an Iron-Air Battery Operates

A new battery by Form Energy uses the rusting of iron to produce an electrical charge.
Product Font Gas Slope Parallel


Discharge: When the battery discharges, oxygen enters the battery through the air electrode, and reacts with water and electrons to create hydroxide ions. Those hydroxide ions then migrate through the liquid electrolyte to the iron in the anode.

Recharge: The process is reversed, and hydroxide ions travel from the anode to the cathode, where they react to form oxygen bubbles, water, and electrons that flow through the circuit.
Discharge: Hydroxide ions from the liquid electrolyte react with the iron pellets to produce rust and send electrons into the circuit.


Recharge: The process is reversed, and electrons from the circuit react with the rust to convert it back to iron metal and liberate hydroxide ions into the liquid electrolyte.
Source: Form Energy
Form can scale more quickly thanks to new tax credits for battery-storage projects in the Inflation Reduction Act and forecasts for faster deployment of renewables, Chief Executive Officer Mateo Jaramillo said in an interview.
“It’s a rising tide across the board,” he said. “It makes everybody feel that much more confident.”
Mr. Jaramillo helped develop Tesla Inc.’s TSLA 3.70%▲ Powerwall battery-storage system and worked on some of its earliest automotive powertrains. He compared Form’s coming manufacturing challenge to what the electric-vehicle maker went through ramping up production but said Form is working with partners to set realistic targets.
Form earlier this year said it was collaborating with Southern Co.’s SO 1.82%▲ Georgia Power on potential deployment of its batteries in the state. The company is also working with Minnesota-based Great River Energy.
Mr. Jaramillo declined to provide the company’s valuation. The company could also raise debt or project financing for the manufacturing plant.
As it develops, Form will have to compete with other alternative-battery startups such as Ambri Inc. and other technologies for storing clean power. Those include pumped water storage using reservoirs at different elevations and hydrogen that is produced from renewable power, another hot area of investment.
Acquiring enough iron to power its batteries could be another long-term challenge. Mr. Jaramillo says the company’s partnerships with ArcelorMittal and other industrial firms could address it. Those heavy consumers of fossil fuels that are under pressure to lower their environmental footprints are seen as some of the biggest beneficiaries if Form and other companies can scale their long-duration storage technologies.
The TPG investment in Form comes partially from the private-equity firm’s more than $7 billion climate fund, one of several large funds on Wall Street that is pumping money into green startups.
 
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