Saudi Arabia’s SABIC, one of the world’s largest petrochemical companies, has established a joint venture company to build one of the world’s largest utility-scale battery factories. Nusaned Investment, an investment company owned by SABIC, and Schmid Group have successfully closed their JV transaction focusing on manufacturing and technology development in the field of Vanadium Redox Flow Batteries (VRFB) after receiving all required regulatory approvals and satisfying all closing conditions.
“The new JV will aim to establish a leadership position in the rapidly developing energy storage market and both companies are fully committed to realizing our joint vision for the project,” said Christian Schmid, CEO of the Schmid Group.
The Schmid Group, a technology group based in Freudenstadt, Germany, focuses on developing customized equipment and process solutions for multiple industries including electronics, renewables and energy storage.
The agreement to establish Advance Energy Storage System Investment Company, the joint venture company, was signed and announced in May 2019.
During the next two to three months, The Riwaq Industrial Development Company, a developer and investor in industrial projects focusing on advanced technologies in the sector of renewable energy, recycling, chemical & metal processing and mining projects, will join the JV as additional investors and shareholders.
The JV aims to become a global technology leader and champion in the fast-growing utility-scale energy storage segment, supporting Saudi Arabia’s Vision 2030 economic diversification objectives.
With R&D facilities in Germany and Saudi Arabia, the JV plans to set-up a GW scale manufacturing facility in Saudi Arabia, expected to be in production in 2021.
The JV’s strategy for developing value chain integrated production will allow it to achieve global cost leadership.
The JV will produce energy storage systems for use alongside utility-scale renewables projects, telecom towers, mining sites, remote cities and off-grid locations. The systems will be utilized for renewables capacity grid integration, establishment of mini grids at remote locations, optimization of diesel generator capacity, and power back-up.
The JV’s products will be offered under the EVERFLOW brand.
The JV will directly contribute to the Kingdom’s renewable ambitions. As per the new energy mix announced this year, Saudi Arabia will aim to install 57.5 GW of renewable capacity in the Kingdom by 2030. Utility-scale stationary energy storage systems will be critical to ensure that the new renewable capacity is stabilized and connected reliably to the grid. The Kingdom could also leverage this technology in the upcoming mega-projects in the Kingdom.
The proposed manufacturing facility and R&D center is going to be developed in Dammam 3rd Industrial City. The facility will be built under a Build-to-Suit lease agreement with MODON. The project site has been identified and construction is expected to start in the first half of 2020. The facility will have an annual production capacity of 3 GWh and will be among the biggest Flow Batteries production facilities worldwide.