RE: Very low trading volumes today10 Aug 2020 21:26
I simply don’t agree with the notion that BE is “a fragmented jumble at present and not an integrated model.” Read the following two quotes from MN. Everything that is being done is delivering on what he outlined in those interviews. All part of a pattern beginning to fall into place.
MN quote from interview August 2019:
“So I think just what are we doing. I kind of think of it as 3 directions within BE. One is around chemicals such as manufacturing and the electrolyte. There's some R and D that we do and this is where the sales and the rental product come in.
(Part 6) The second part is around actually manufacturing and assembling the batteries themselves. I think at some point once the market develops in South Africa we will look to put in an assembly plant here. Together with that we are looking at developing opportunities to take positions directly in some of the battery companies themselves. Obviously we need to be comfortable that there's a good return there, but its a way for us to start having some impact at the IP part of the industry.
Then the third part which is really where we spent the most efforts from the BE point of view is what I call deployments. And there we can do direct sales of batteries as a local value end partner. But much more interesting is what I call project development where if someone needs a storage solution maybe together with a solar plant we can go out and develop this opportunity. Do the business case for it. Raise the funding. Do the permitting. And that's a very interesting kind of market. We've got a pipeline of projects. “
And then MN from interview in November 2019:
“In some ways we aren't in direct control. Let's take an example of a project like our minigrid. There we are the developers so we get a development fee when that project closes. We are an investor so we get the return in equity or dividends from the power purchase agreement that is signed to pay for the energy that minigrid produces. By the way we are supplying a battery into so if we want to we charge a mark up on somebody else's battery. If we are invested in that company we get an additional benefit because our investment has now appreciated in value because that company has now got more deployments.we are supplying electrolyte so we get a fee for manufacturing the electrolyte into that project. We mined the vanadium so now we've got a sale on the vanadium. This integration allows us really to capture the value sometimes 4 or 6 different activities on just one single project. Now I want to be honest we are not going to develop every single vanadium project every vanadium battery project in the world but if it's in Africa then it's extremely active. If it's somewhere in let's say Australia yes we are probably not involved in the development, but we may be supplying vanadium, electrolyte, possibly having equity stake into the company that invested there. (to be continued)
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