Dive Brief:
- Fluence Energy saw its pipeline increase by $2.9 billion, or 22%, from Q1 to Q2 2024. Its total pipeline stands at 74.4 GW and $16.3 billion, marking the 10th consecutive quarter during which orders outpaced “revenue recognized,” the energy storage provider said in a Wednesday earnings report.
- The second quarter saw Fluence debut a larger, more energy-dense version of its Gridstack Pro battery, sign its first contracts for batteries expected to qualify for the Inflation Reduction Act’s domestic content requirements and expanded its digital services backlog by more than 75%, the company said Thursday.
- “We are seeing tremendous interest from customers on domestic content products,” Fluence President and CEO Julian Nebreda said Thursday during an earnings call. Fluence is “one of the first companies capable of providing customers with products we expect to qualify” for the 10% IRA tax credit domestic content bonus, he added.
Dive Insight:
Global energy storage capacity could grow at a 27% compound annual rate and reach 1,877 GWh by the end of 2030, according to the BloombergNEF 2H 2023 Energy Storage Market Outlook.
BloombergNEF expects the U.S. to add 349 GWh in energy storage capacity and Australia — which is “becoming [the] second most important market globally” for Fluence, the company said in its Q2 earnings presentation — to tack on 25 GWh by 2030. Germany, another key market for Fluence, is expected to add 23 GWh by 2030.
“We are increasingly encouraged by the growing number of opportunities we see around the world,” Nebreda said.
The company said its total pipeline grew by $2.9B, or 14.8 GW, from Q1 to Q2.
Fluence defines pipeline as its “uncontracted, potential revenue from energy storage products and solutions, service, and digital software contracts, which have a reasonable likelihood of contract execution within 24 months.”
The company’s cash position grew by about $87.8 million in the first half of its 2024 fiscal year, which ended March 31, compared with a decline of $164.5 million in the first half of its fiscal 2023.
Fluence expects to begin manufacturing battery modules it expects to qualify for the Inflation Reduction Act’s domestic content bonus by the end of 2024 and deliver the first orders next year, the company said. In addition to the IRA bonus, domestic-content batteries address cybersecurity and supply chain concerns while meeting increasingly common utility “scorecard requirements” for U.S.-sourced products, Fluence said.
Fluence also teased its new Gridstack Pro 5000 Series product, a “more energy-dense 5-6 GWh enclosure” that improves land-use efficiency in utility-scale storage plants. GridStack Pro 5000 complements the existing Gridstack Pro 1000 and 2000 Series products, allowing for “mixing and matching” to “effectively address the issue of system overbuilding” in space-constrained locations, Nebreda said.
Citing the IRA as a tailwind for the U.S. storage buildout, Nebreda downplayed concerns that the industry is vulnerable to a potential change in political control of the federal government next year. Bipartisan support for utility-scale battery storage is driven by fundamental factors like declining technology costs and an “increasingly urgent need” for grid stability as more renewables come online, he said.
Fluence sees “remarkable resilience to political change [as] renewable energy becomes the most economical energy resource in states that have traditionally relied on fossil fuels,” Nebreda said.
