The United States Department of Energy (DOE) has set a long-term goal to achieve a levelised cost of storage (LCOS) of US$0.05/kWh for long-duration energy storage (LDES) by the end of the decade. This ambitious target aims to ensure the widespread adoption of energy storage technologies that can provide reliable, long-term power supply to the grid. To achieve this goal, the DOE has identified vanadium redox flow batteries (VRFB) as a promising technology for LDES applications. These batteries offer a unique combination of high energy density, long cycle life, and scalability, making them well-suited for utility-scale energy storage. Storion, a joint venture between Largo and Stryten, is working to reduce the cost of VRFBs and make them more competitive with other energy storage technologies. The company’s strategy focuses on creating a domestic supply chain for vanadium, which is a key component of VRFBs. The vanadium used in VRFBs is currently sourced from China, where most vanadium is produced as a by-product of steel production. However, this poses significant logistical challenges and high costs, particularly with the imposition of tariffs on Chinese imports. By leveraging Largo’s access to the Maracás Menchen Mine in Brazil, which is the only vanadium mine in the western hemisphere, Storion can tap into a domestic supply of vanadium, reducing costs and improving logistics. Storion’s vanadium leasing model, known as Largo Physical Vanadium (LPV), allows investors to invest in vanadium assets, stored in a VRFB, in the form of leased vanadium electrolyte. This model provides a unique opportunity for investors to participate in the growth of the VRFB market while reducing the financial burden of vanadium costs on developers. The company’s approach to reducing VRFB costs is centered around creating a domestic supply chain. By building a supply chain in the US, Storion can cut logistics costs and improve the efficiency of its operations. The company’s two founders, Largo and Stryten, are well-positioned to move batteries and improve battery chemistry from the lab to production, leveraging their expertise in battery storage solutions. While vanadium is an expensive resource, Storion is focused on making VRFBs cost-competitive with other energy storage technologies, such as lithium-ion batteries. The company’s strategy is centered around targeting new application spaces, such as long-duration energy storage at utility-scale, where VRFBs can provide cost-competitive solutions. In addition to reducing costs, Storion is also working to improve the scalability and efficiency of its operations. By leveraging its domestic supply chain, the company can reduce its reliance on external components and improve its overall competitiveness. Tariffs and manufacturing costs are significant challenges for VRFB developers, particularly those relying on Chinese imports. Storion’s access to a domestic supply of vanadium, however, reduces the impact of these costs and provides a more stable business model. The company’s approach to collaboration with oil and gas companies is also noteworthy. By working together, Storion and its partners can develop new solutions that address the growing energy demands of the grid. The company’s focus on utility-scale energy storage and long-duration energy storage solutions can help to optimize operations and reduce energy consumption. In conclusion, Storion’s approach to achieving the US Department of Energy’s long-duration energy storage goal is centered around creating a domestic supply chain, reducing costs, and improving the scalability and efficiency of its operations. By leveraging its expertise in battery storage solutions and its access to a domestic supply of vanadium, Storion is well-positioned to make VRFBs a cost-competitive solution for long-duration energy storage applications.
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