This article has been revised.

Westlake Village-based Energy Vault Holdings Inc. went public two years ago with an ambitious goal: to be one of the first truly diversified energy storage companies across a range of technologies, market segments and geographical territories.

During those two years, Energy Vault Holdings has made progress on all three fronts. It has been deploying and partnering on projects using battery storage, renewably generated hydrogen and its own proprietary gravity-based energy storage system. And those projects have targeted industrial energy users and utilities across countries on four continents: China, the United States, southern Africa and Australia.

The company has reaped considerable revenue in the process: $343 million last year, more than double the previous year. Much of that revenue has come from licensing arrangements with multiple partners. But the company has yet to turn a profit, posting about $106 million in operating losses last year. In its fourth-quarter earnings report, Energy Vault stated it expects to become profitable late this year and into next year.

Nonetheless, Energy Vault’s chief executive, Robert Piconi, is pleased with the company’s progress over such a short period of time.

“We’ve grown this company as a public company globally in unprecedented ways across multiple continents, multiple technologies, while serving different customer segments: public utilities, independent power players, and large industrial energy users,” Piconi told analysts last month in the company’s quarterly earnings teleconference call.

“The result has been the fastest-growing company in energy storage in only our first two years,” Piconi added.

This diversified approach is relatively unique among energy storage companies, according to Christopher Ellinghaus, senior utility/alternative equity analyst with New York-based Siebert Williams Shank and Co.

Ellinghaus said that with the rapid growth in demand for energy storage as industries and utilities increasingly turn to renewable but inconstant sources of energy, such a diversified approach confers a significant advantage.

Gravity storage in China

Last fall, Energy Vault’s first gravity storage project came online at a 25-megawatt facility in Rudong, China, just outside Shanghai.

This gravity storage system moves more than 1,000 25-ton blocks of aggregate material up and down in unison, generating and storing kinetic energy. The facility takes in energy to move the blocks up, stores the energy by leaving the blocks in that elevated position, then moves the blocks down to release the stored energy. 

It’s an old concept more often applied through the use of water reservoirs, but Energy Vault is one of the first companies to use choreographed computer technology to store energy without the use of water.

Energy Vault and its Chinese partner – environmental services and power generation company China Tianying Group – completed construction in October and began connecting the project to the power grid at around the same time. The project is still awaiting a final round of approvals before it can begin full operation.

When the project was announced back in 2022, Energy Vault disclosed that it had received a $50 million licensing fee up front from China Tianying Group. 

But that project turned out to be just the beginning for Energy Vault. Just before its quarterly earnings call last month, the company said that ground had already been broken on three other gravity storage projects in China, including two plants in the country’s western Gansu Province that together are expected to store about 67 megawatts of energy, enough to power the equivalent of about 11,000 single-family homes in the United States. 

Energy Vault also signed several development agreements in China during the fourth quarter, including a 330-megawatt project northeast of Beijing. That brings the total number of Energy Vault’s projects in China to nine.

“China continues to be an amazing bed of growth…(with) state-mandates for not only renewable-generation projects, but also for energy storage,” Piconi told analysts on the earnings call.

Meanwhile, Energy Vault last quarter signed a 10-year licensing and royalty agreement for energy storage projects in the 16 member-nations of the Southern African Development Community. The agreement was signed with Gravity Energy Storage Solutions, a consortium based in Cape Town, South Africa. According to an 8-K filing with the Securities and Exchange Commission, this licensing agreement includes a $20 million licensing fee payable in installments over 10 years.

The driving force behind this agreement is the projected need for about 125,000 megawatt-hours of energy storage in the region by the mid-2030s. The agreement lays out a framework for future energy storage development in the region; so far, no specific facilities have been announced.

On the battery energy-storage front, Energy Vault announced about 18 months ago that it had received an award from the developers of the 250 megawatt-capacity Meadow Creek Solar Farm about 100 miles north of Melbourne, Australia. The award is for software-management services to integrate a planned battery system into the region’s electricity grid; financial details were not disclosed.

Progress on domestic projects

Meanwhile, back in this country, Energy Vault during the fourth quarter inked a development deal with an undisclosed public utility in Washington state to use its gravity energy storage technology to help address a multi-gigawatt storage need regionally in the Northwest. (One gigawatt is 1,000 megawatts; a single megawatt is 1 million watts.)

That follows a 2021 agreement with Enel Green Power, a unit of Rome-based Enel Group, to site a gravity storage plant in Snyder, a city in north-central Texas. Piconi said in the earnings call that the plant is now “up and out of the ground.” The plant could come online as soon as the end of this year; if it does, it will likely be the first active gravity storage facility in the nation.

Turning to other technologies, Energy Vault made significant progress late last year on a trio of battery-storage projects. The company partnered with Sacramento-based Wellhead Energy to install a 69-megawatt battery-storage system at a natural gas-fired peaker plant in Stanton in Northern Orange County. A peaker plant is designed to operate on an intermittent basis when demand exceeds power supplies from full-time generating facilities. The battery-storage plant went into full operation during the fourth quarter.

Another larger battery facility developed in partnership with Nevada’s largest public utility – Nevada Energy – and capable of storing 440 megawatts began operations in the fourth quarter near Las Vegas.

The third battery plant, with a capacity of 100 megawatts, was expected to be commissioned by the end of this month in Fort Stockton, Texas. Energy Vault teamed with Austin, Texas-based battery energy-storage developer Jupiter Power for that project. 

Energy Vault has not disclosed project finances or revenue streams for many of these projects. The company has stated in general terms that it generates revenue through a combination of licensing fees and royalty payments.

Green hydrogen added last year

Early last year, Energy Vault added a third energy-storage technology to its quiver: “green” hydrogen created from renewable sources. The company announced a partnership with Pacific Gas & Electric, the utility subsidiary of San Francisco-based PG&E Corp., to build a hybrid green hydrogen and battery-storage plant in Calistoga, just east of Napa Valley.

Under this 10-year tolling agreement, Energy Vault is supplying fuel cell battery technology to store hydrogen that’s generated offsite by a third party through electrolysis (a process that splits water into its component atoms). The power to run the electrolysis process comes from renewable sources – hence the name “green hydrogen.”

Piconi said during the earnings call that the fuel cell plant is expected to be operational by the middle of this year.

“This solidifies Energy Vault’s global leadership role in green hydrogen technology for long-duration energy storage and specific microgrids for multi-day storage,” he said.

Looking ahead, Piconi said that the company will have to contend with the same headwinds that the rest of the energy storage industry is facing, including long permit wait times and supply-chain delays.

On the permit front, Piconi noted that it can take up to two years to get approval in California for a facility to tie into the electricity grid. And with regard to supply chains, he noted that there are often delays in obtaining simple yet essential components, such as transformers. “There’s such intense demand for these components from (developers of) data centers and bitcoin operators,” he said.