Stephan (00:02) When I look into energy storage, there’s always  two sides of the coin. One is  the whole revenue and commercialisation strategy, right? Earning money with the storage assets. And the second one is to make them properly you have to keep the technical performance to  high availability, high safety and reliability standards, all those kinds of things. At TWAICE, we’re really focusing on the second piece on the technical performance of the assets.

Adam Sroka (00:48) Hello and welcome back to the Hypercube podcast. I’m delighted today to be joined by Stephan. Stephan, would you like to introduce yourself for the audience?

Stephan (00:56) Yes, hi, Adam. Thank you. It’s a pleasure being here. I’m Stephan, founder and CEO of TWAICE. And it’s an honor to have a conversation with you about energy storage and analytics here today.

Adam Sroka (01:09) Yeah, very excited for this one. And for those that maybe are less familiar, who are TWAICE and kind of what do you get up to?

Stephan (01:16) So,  to give you a bit of an overview of how the story started. We started basically in 2014. did my PhD in batteries and what we basically did is we created a 200 kilowatt hour grid storage. It was called Energy Neighbor. It was placed here in Munich. So we did our PhD here, and it supported a village. They had a lot of solar. so we created this…

battery storage, very hands on, right? The housing, the cooling system, the battery management system, everything you could imagine, we placed in there and did research about  how can this serve the local community? How can it earn money? But on the other hand, also  how you can really  operate it in a safe and  high available manner. And that is actually  where we had the touch points with

energy storage. And we realised then that during those years of doing research and building up the storage, that there is a lot of potential in optimising these assets based on the data which comes out of the energy storage. In 2018, we finished our PhDs, energy storage project was done, and then we founded TWAICE and

our goal since 2018 is really  to plan, to help our customers to plan and operate energy storages with full confidence. And yeah, it started early, the industry came a long way, we came a long way and now we’re here.

Adam Sroka (02:48) Yeah, that is it because 2014 feels like ancient history in this industry,  the way things have changed and what’s gone on. Just to pick on a point there. So you’re not just doing the optimisation, but you’re helping your customers plan their sites and their asset mix and things like that.

Stephan (03:05) When I look into energy storage, there’s always  two sides of the coin. One is  the whole revenue and commercialisation strategy, right? Earning money with the storage assets. And the second one is to make them properly you have to keep the technical performance to high availability, high safety and reliability standards, all those kinds of things. At TWAICE, we’re really focusing on the second piece.

on the technical performance of the assets.

And that for us always has two parts. One is  the planning of the energy storage projects, asset, choosing the right suppliers, all of those kind of things, using the right cell. So that’s  the planning phase, and the second one is then operating that and monitoring and analysing it and trying to be as proactive and predictive as possible. And your question comes to  the planning phase and

You’re right. I think personally, a lot of right and wrong decisions are made in the planning phase, which supplier you’re choosing, right? A lot of availability of the assets coming, choosing the right suppliers, for example. And there we are supporting our customers. For example, supplier selection, comparing different cell chemistry. The original storage we created in 2014 was actually an LFP cell.

Adam Sroka (04:03) Yeah.

Stephan (04:25) So it was very early already, like a very strong dominance of LFP batteries. overall, it’s  really also helping them to do different degradation simulation, different cells interaction during the planning phase. And then hopefully they have created a successful project, made it through the grid connection queue, got the project live, and then it’s about optimising it afterwards.

Adam Sroka (04:25) Wow, okay. Yeah.

Yeah, that is interesting. So, we’re right into the weeds here, but we’re off piste with the questions, but it’s fine. Anecdotally, I feel like in my experience, there’s a lot of people – especially in the GB market- there’s a lot of new players, people that have come into the industry and they’ve seen the high revenues of years ago. They’ve got moving with a project, seen that they may be simpler than other capital infrastructure projects and started to move,

and maybe aren’t as familiar with some of the technical complexities, especially around the data and things like that  where we live. This industry bears needs. Do you find that you have to do a lot of education on that journey? Because it feels like you’re really well placed to do so.

Stephan (05:27) Yes, so you are absolutely right. What we see, similarly like in the UK market, but also  in other areas, is the good news about energy storage assets is now that you can build a business out of it, right? You make money, you can earn money, the projects are viable. But in some cases, honestly, even  when you look at the ERCOT also, they are even more profitable than, for example, solar projects. And that basically leads exactly what you described is that a lot of

infrastructure investors, which maybe  invested before in solar and wind, are now doing the same on the energy storage side. So they’re moving into the space, building up large pipelines, large projects. But having said so, batteries are by nature very different to solar panels or wind, because it’s at the end, it’s an  electrochemical system, right? You have a lot of different cell chemistries in those storages, like the cooling,

like the connection,  the energy management system, then it’s only not a producing element, but also  a consuming, so charge and discharge. So a highly flexible, quite complex asset. And for most of the companies, they, or a lot of them treating very similar to solar, right? Making the business file cases, getting the ARR out of it and starting of it. And you’re absolutely right. There’s  a lot of education needed.

Stephan (06:50) The whole industry is so new still that the question is where do you draw, bring out your experience? I mean, we did that since 2014, but honestly speaking, until 2019, 2020 there were not too many energy storages out there. So how can you build up experience about different suppliers? About different…

How do you build up the storage if you go with DC blocks or on the AC side? So there’s a lot of different choices you should and can make. And you’re absolutely right, there’s a lot of educational parts to it. And due to that, we also think it’s crucial, and it’s what makes us unique, that we already start in the planning phase and not only covering the operational phase because we have seen that in the past with a lot of customers,

when you make the wrong choices there, then you have to work hard afterwards to get really high-performance, high-available assets afterwards. So yes, there’s a lot of education needed.

Adam Sroka (07:53) I guess no one’s been doing this for 15 years yet, right? Cause it is that young as an industry, like the tail end, the kind of late life problems we’ve not even really seen for many of these assets. We can see what we expect, but it’s an interesting place to play it. Something I’d be interested to know from you then, from the customers you speak to, the project you’ve been involved with, do you have an idea of the biggest trends within

BESS and the market today and some of the big changes perhaps over the last few years?

Stephan (08:23) So, like there I can  speak probably for an hour about it, but I think the biggest trends overall and also  then pain points from our customers in a second step. So the trends are in general cost from, from batteries are coming down, right? So that’s, we see that like a lot of shift to LFP batteries, which most of like the batteries out there now on the BESS side.

Stephan (08:52) Then there’s also a lot of cost optimisation happening that a lot of players source DC blocks from Asian suppliers, which makes it easier to augment. They select the inverter, modularising it, and bringing a lot of efficiency in building up the projects. And then we see some trends on the DC side that a lot of

companies now starting also like co-locating storage with  solar assets. And so there is  a good trend in using  really DC coupled energy storages with solar. So there’s  a lot of innovational trends coming out, which are independent from the cell chemistry. And it’s more like how you build and design the projects. I think that’s one big part of it. And the second one is

Stephan (09:45) really like the viability of the business cases. So when you look in the market right now, it’s, and I think that’s great to see, right? I mean, when you were in 2014, it was always how hypothetically you can earn money with energy storage assets. Now there are so many different trends  in capacity markets, in energy shifting and frequency control,  also

placing some transmission lines with non-wired assets. So there’s a lot of potential in earning revenue. And that is also a big trend across the globe, like UK market, Europe, Central Europe, and the US and Australia. And that leads that more energy storage assets are getting deployed. Now, when we look at it TWAICE right now, and we just did a survey,

It’s exactly how you described it, a lot of new players are coming in, building up  the first energy storage assets and then they are struggling. Right. And that is  the most dominant one  because the asset is not at the availability as they have planned. We just  did a survey, which we’re launching this week and around like we did  a survey of around 100 BESS experts who run and operate BESS and 58 % say  availability is their major problem.

Adam Sroka (10:52) It’s just that.

Stephan (11:06) Because when you imagine you have planned your business case 95% of availability or 97%, it’s only 95%, then you of course on the one hand  you have the revenue models you can earn money out of it, but when the availability doesn’t fit together, then that’s a big pain point. Or on the other hand, you also run into some penalties and the SOC is not accurate. A lot of those areas where…

I would say now the next couple of years, one, two, three years, it’s a lot about the trend of really  the industry learning curve of really growing and running highly available assets out there. So I would say that’s another piece and  very linked to TWAICE.

Adam Sroka (11:49) Yeah, that’s really cool. So, is it  that  the availability is just lower than expected or is the availability hard to predict and more unpredictable,  difficult to forecast, making it difficult- or is it both?

Stephan (12:05) Yeah, you’re right. So at the end, it’s both, right? Our belief is that the data strategy of an energy storage is a very big part of your commercial strategy. Or you need  these assets,  you have  hundreds of thousands or even  millions in large assets in the US, for example, or Australia of battery cells in there.

These are generating a massive amount of data. Then you have  the cooling system, you have the inverter,  the PCS, all of that generating a massive amount of data. And one is to really getting from  more  this looking backwards to like a predictability. So really understanding now you get into the hot season in the ERCOT in the US,

because there is where the big spreads are in the market. That is where you earn money in a couple of days. So to make really sure you have a high performance asset going forward it’s really drawing conclusions out of the data on will there be some imbalances coming? Are there some trends building up in the assets or not? I think that’s one big part, but even more important or like of similar importance is when you realise you have some availability issues.

Where does it actually come from? And secondly, what can you do around it to really  rebalance the system, recover some parts of the lost energy of the assets and doing the real cause analysis in the right action. Because as you mentioned, you have  a lot of containers, a lot of components in there. And to really pinpoint that,

Stephan (13:50) is not easy. And now  let’s zoom out or let’s zoom forward. In a couple of years from now, every operation manager or  asset manager, they are not responsible for one storage asset. Maybe they are responsible for 10, 15 storage assets. And then the scale just increases. And when you don’t have  an optimised system in place, which really helps to understand the assets at scale,

and finding the root cause, helping you to predict when things can go wrong in the future and really helping you to in an optimised fashion increase availability, then you could be lost.

Adam Sroka (14:32) Yeah, like is it even possible without the granular, the large data? How would you even go about  doing that analysis without holding all the data and turning through it? It feels like just one of those problems that there is only a complex solution to.

Stephan (14:48) You’re probably right. There is no easy answer to that, I mean, what you can see in the market is that of course, some of the integrators who are deploying the assets are very vertically integrated and maybe take all the risks  on their, on their side. So that the asset owner or  operator has to worry less about it at a certain moment. They have to worry because there is always  a timeframe to it.

And usually energy storage assets should run for quite a long time. So there is maybe  on a business model side some things you could do around it. But when you’re not sourcing only for one supplier, but several suppliers, or maybe also want to get some cheaper solutions and sourcing from maybe  more low-expensive integrators, then there is no way to bring in some burden

in-house. And there’s also  a belief – and also  I think that’s right- that when you not only own the storages but really operate them also on a commercial side and build a good data and maintenance strategy and operation strategy that you have just  higher availability and higher earning assets.

And that at the end helps you again to get more money in building next projects. So it’s probably the complex and more difficult way, but it’s also probably the more profitable or more lucrative way.

Adam Sroka (16:19) Yeah, it’s an investment in your future revenue certainty and lifetime of the asset, I guess as well, like geeking out more performance and more lifetime. Not a job for Excel, though. We’re not doing it in emails and Excel, I imagine.

Stephan (16:32) Hopefully not. Exactly. No. At the end,  we see that a lot of companies who are  coming from maybe  solar and wind monitoring, even they are just blown away how much data an energy storage asset generates. And then usually the data,  the energy storage assets,

providing from the battery management system or the SCADA system transferred is usually, I mean, it’s temperature, current, voltage. I mean, there is some information in it, but  at the end, it’s not  the smartest data. So you have to first do something with the data to understand what is like the SOC imbalance, what is the thermal imbalance? Is there  some KPIs building up which are safety critical, all those kinds of information. And then you have to do it in an automised way.

Because when you’re an O&M person, you don’t want to do a once a month manual analysis. You want to have it when you want to have it, right? So in the next hour, because you do the reporting for this week and so on. And I think that is one big piece. to share also one use case, where we see also this interplay is when you invest in 100 megawatt hour storage.

then it costs you 30, 40 million, and  the large ones are in the hundreds of millions. So there’s  a big asset value going for the integrator to the asset owner. And especially like this, this handover phase, which you call like the commissioning phase, where  the energy storage gets energised and generates the first data and  the first cycling. And you can use this initial data already heavily to de-risk the energy storage assets, right? Because

In this handover phase, you really want to make sure and check, did I really get what I have bought? And there is the first time where you get real life data from the energy storage assets and consuming that and drawing the right conclusions out of it is often a very cheap way of de-risking the assets. For us, in every commissioning project, commissioning phase,

Adam Sroka (18:30) Mm-hmm.

Stephan (18:52) we’re in there, we have found things which otherwise the asset owner would not have found. And now going one step back, when you decide as an asset owner to go with  a very verticalised integrated integrator, you don’t get any data. How can you really double check that you got what you have really  bought and ordered? So there’s like a piece to it. So there’s probably no other way to take some burden on those topics to your side. Otherwise you also can’t double check it.

Adam Sroka (19:21) And that’s it. And we find that from the kind of operations point of view as well around  asset owners that maybe use route to market providers or optimisers where they’re handing over the control of the asset. And we get this common complaint that how do they verify the performance of the asset? How do they verify the decisions made by the optimiser against the portfolio? Was my asset optimised for my returns or the portfolio’s returns, which will have other companies assets in it and things like that.

And it’s actually a really hard question to answer unless you do have, and again, it’s one of those problems. It’s like, the only way to answer the question is to just get all of the data and do it all yourself, which is quite a painful point. What about, do you ever get asked about  simulated batteries and digital twins then? Because  you’ve built up a business now. you’ve got a lot, you’ve seen lots of different assets. You’ve got lots of battery boffins like yourself that really know the domain. Right. Have you looked…

Do you get asked that about simulations and digital twins and is that an offering that TWAICE can put forward?

Stephan (20:22) Yes, you’re absolutely right. We have seen a quite decent amount of energy storage assets across the globe and different cell chemistries. And what we are doing now is, I mean, at the end, it’s  a lot of expert knowledge, right? And the question is, how can you make this expert knowledge available? And for us, it’s again the same statement, right? We are there to really plan and operate the BESS with full confidence.

And so you can use this expert knowledge in the plan phase, so where we provide some simulation tools to our customers where they can simulate different degradation for different cells. They are usually sourcing a lot of new suppliers, so can double check is it performing how the cell suppliers originally claimed. So there’s a lot of potential into also

that the benchmarking in this plan phase. But having said so, then of course, in operational phase, bring in the expert knowledge of, and that’s a lot about, I would say, about a lot of value comes from like a company like TWAICE and analytics is also to find the things the customers don’t know yet. And a lot of those things come from

understanding how maybe also other assets are performing and behaving, I brought this example of availability before, but there’s also a lot of  value proposition around safety and around warranty tracking. And on the safety side, at the end, there are for us always two major things. One is a trend, right? A battery gets

worse over time and you see the trend and then you can see  how this cell performs to another cell and what is  other different trends and then you can spot it and can detect it. But there’s also another area and that is  more like the outliers and they are there actually from the beginning. So when you switch on your assets and you have some quality issues in your cells, which can be safety critical later on, you can detect them in the first week of operations.

But they can cause fires in two years from now. But these come from having the database and expert knowledge to really see, are there some outlier behaviors in the assets and spot them in some optimised way. And so due to that, yes, you’re right. We are using this expert knowledge in the planning phase, but also the operational phase, which is then more linked to safety, but also some kind of warranties.

And then it comes again to the same thing you have mentioned before,  is on a commercialisation or trader side, so they’re taking over the assets. And then there’s always the question: what’s happening with the assets? Because  the integrator provides a warranty, then there is an owner, then there is  an operator. And at the end,  are the warranties voided? Is the storage behaving like the warranties? And the warranty is often not only  degradation over time, it’s

round trip efficiency, different temperature conditions. There’s  a lot of  boundaries to it. And the question is, do you only have interest in the status quo or also  how does the next one, two, three years look like? And  due to that using this expert knowledge and also  doing some prediction of, for example, is  this asset degrading, how is the asset degrading over the next couple of years? And is there an impact to the warranties?

Of course can help you to make different decisions on the commercialisation side.

Adam Sroka (24:08) So we’ve skirted around it a fair bit. I’m really interested in that early warning, early indicator of things in the first few weeks of operation that show you there are outliers here. That’s one of the main benefits, I think, of utilising third parties that are separated from your engagement in any business domain.

TWAICE or  a company like Hypercube or others, we see  one in a million events quite a lot more often because we have more exposure to more systems. And that’s some of the value that I think you bring to bear as a third party. So it’s interesting that you’re already looking at  early indicators for lifetime issues and things. I think that’s a really valuable additional benefit to using a platform like TWAICE. And so we’ve skirted around the issue a bit or the topic a bit, but you must be

such a fascinating playground place to work for data scientists, machine learning people. Have you got loads of really super clever, really happy stats boffins under the hood somewhere?

Stephan (25:11) Yeah, so I hope so. So no, you’re absolutely right. I think in general for us, we always have the three domains, right? One is really  the battery expertise. So it’s the domain about batteries. That’s also where I come from, like battery PhDs. Then you have  this big crowd of  data scientists, because at the end it’s all about data. And the third one is of course, bring that into

Adam Sroka (25:34) Yeah.

Stephan (25:38) into a usable software or service which brings value to our customers. You’re right, there’s  a lot of playground around  the data because, and I think we will see that even more going forward because I would say when you look four years back,  at the end, were not too many energy storages out there. Now it started really  picking up.

And now  two, three, four years back, there was always  small pilot storages. At the end, it was for testing reasons, right? And then now the last two, three years, companies scaling really in  for scale and for scale means you need to bring in some data strategy, right? And I think we are just  one company of pioneering of what the value can be out of it. You touched about it that  early detections,

safety side, availability, warranty. There are a lot of different use cases which bring value, but there’s also a lot of use cases on the commercialisation and revenue trading side, which bring value because you have  a lot of data around the assets, but also around weather  forecasts and all those kind of things. And so due to that, the data scientist is a very crucial piece, but my learning over the last couple of years is at the end you…

really need to tie all the three disciplines very much together because at the end as a customer, nice insights are good, but can you really use them? Are they understandable? Can you do some reporting out of it? Can you share this reporting with your colleague? All of those kind of things. And so you have to somehow merge this expert knowledge and data science in real software, which is industrial scale and can be used.

Otherwise, you’re more

like a reporting platform, which is fair for the learning phase of a lot of companies. But is it really  the professional solution where you want to run your five gigawatt hours on and hundreds of millions of asset value? Likely not.

Yeah, it’s almost like you’ve read our pitch deck, but that’s totally like my spiel around the value that Hypercube I think brings it’s learning a domain takes a long time and you point techies at any problem and they’ll find interesting things. They’ll find patterns, they’ll find crevices with stuff to look at that holds promise, but it’s only really when you connect the dots to someone that deeply understands the

commercial side of the opportunity, the business, the strategy, and the domain that you’re in, that the magic starts to happen. And it takes a long time to bring, to bring all that together and build a culture that does that. And it was like, wow, at Hypercube we were just, we were going to obsess about one domain like really deeply and hopefully bring the expertise to bear on our problems. And it makes a big difference. like you can get going much faster. You can challenge the customer on.

assumptions and things because you can say, actually, no, we’ve, gone, we’ve done this before. We’ve seen this elsewhere. We do understand what, what you’re, um, what you’re trying to achieve and where that goes. We’ve talked a lot about battery and the energy trend. I’m interested, what about  technology trends? There’s a lot going on. Obviously everyone’s dead excited about AI at the moment. Are there technology trends in the kind of software space that are interesting for TWAICE and what you’re doing? doing?

I mean, when you look at TWAICE at the name, we used AI since 2018. We went into that space very early. It was more called machine learning during that time. But now I would say it’s really turning more

and in a faster, more efficient way, insights out of the data. And secondly, it’s about making it understandable, right? Because at the end, it’s, it’s, we always have to imagine when the industry is scaling up, of course there’s  more energy storage experts and battery experts are entering the field and  deploying and running the assets. But I mean, and  it’s not a secret that  a lot of

companies when you look at  Germany right now, I think we have two gigawatt hours live and 200 gigawatt hours in the grid queue. So when you imagine that it’s  just crazy. Somehow even if we will not get there probably, but just getting a bit closer in that direction, you have to deploy and run so many energy storage assets, which is crazy. So you need to have a lot of experts and a lot of  people doing so. And I think a lot of power comes, AI is throwing those

bringing in this expert knowledge to people who maybe are not like, it’s not there five years of battery PhD. And so I think that’s quite exciting, quite exciting technology, which we also  adopt and use a way more. And second one is, I think also  making this whole knowledge way more transferrable because when you see a lot of different cell chemistries, different assets and so on,

think that is quite interesting. And maybe bringing in a completely different one is on the trading side, think it’s also where you folks are thinking a lot about it, to really have some more AI-enabled energy or this patching of the storage assets. I think there’s a lot of power in that area of the coin. And it goes back to, and maybe that’s originally because I’m a

battery expert when you look at cell chemistries, right? Now we have  LFP cells, but there’s so many companies out there who do research on a material level; how to design the next battery cell and make that more performant,  safer, higher energy density. And they also adopt a lot of AI to define the material discovery. So I would say it’s really  a horizontal technology, which probably addresses most of  the

the parts of the whole supply and value chain of an energy storage asset. So that’s quite cool.

Adam Sroka (32:07) Yeah. And we’ve built,  solutions across all that space. It’s quite funny because I think people naturally jump to like AI is going to be completely automated. It’s going to take control. It’s going to take over and they get fearful of that. And  I wouldn’t be very comfortable handing over my hundred million euro battery to some AI model, right? But actually there’s so much value in that processing the million cells of data that’s streaming 20 Hertz of logs at you,

and not stopping and processing that and turning it into a lens that’s human understandable. Actually, I think that’s where all the low hanging fruit in the AI space is going to come from in the interim. And it sounds like that’s the kind of work you’re doing over it TWAICE. Would you say that the appetite for new technologies is there with the customers, with the owners? Or in our experience, we find that…

It’s maybe a little bit conservative, a little bit reticent to do things safely and that kind low risk approach.

Stephan (33:10) So that’s a very fair question and a very, very valid one. So I mean, when you look at the energy storage industries, the players can be quite different, right? It can be  utility companies, we are moving into the space right now. So coming more  from gas and coal and  big utilities

now deploying and operating energy storage assets in, for example, capacity markets. Then you have  the IPPs, maybe also  really  self-integrated IPPs who only do energy storage assets for the last four or five years and really innovating that area. And then there’s  a third one, which are more like this, infrastructure investments companies, project development, did solar wind and now  also running into energy storage assets.

And I think probably as a lot of different others as well. And I would say  different players have a different sense or appetite for innovation and risk. So when you look at utility companies, for example, TWAICE, we did all  the certification ISO, cybersecurity, all that you can imagine because it’s such a regulated industry and to move into this regulated industry.

Stephan (34:28) You’re absolutely right. It’s about bringing the value, but the value has to come with a lot of security. So whereas  smaller companies, 30 people building  the fifth or sixth energy storage asset and really just pioneering that area and maybe even  really like also operate the assets and so on. So they are way more open to also like applying new technology, maybe get a bit more risk in as well.

So would say it really depends on which kind of player is looking into that. And the nice thing and exciting thing in the energy storage side is you see them all now. So they are all here.

Adam Sroka (35:05) Yeah.

And so we talked about 200 gigawatt hours of pipeline in Germany. You’ve got, yeah, the goings on in, you’ve got ERCOT, CAISO, the GB market, Australia, all on the up. Do you think…

manufacturing and the kind of, even the bureaucratic capacity is there to make all this happen? Or are we,  already at a point where we need technological breakthroughs to achieve some of this stuff? From a BESS perspective, I guess.

Stephan (35:43) So I would say that we’re definitely not there yet, right? Because I think we have a lot of trends which help us to get there, right? Like  reducing battery costs in a lot of areas, the energy storage or earning money. But having said so, there is

still a lot of regulation needed depending on which country you are in. But for example, when you look at the UK, US, Europe and Australia. Those countries are, you know that BESS in the UK market. It’s just growing strongly because in Germany, for example, you have a lot of this pumped hydro

storage in the US they have more gas to fill up the peak demand. And that’s less there in the UK and less there in the Australian market, so there was a bigger need also from a regulatory perspective to make it available, deploying storage to really stabilise the grid. And I think the same things are possible in markets like Germany or in some…

I think in the US you always have to differentiate CAISO, ERCOT, they are moving faster, other areas not. So it depends, but there’s a lot of regulation possible. And when you like in Germany, for example, when you apply for grid connection, right, you don’t know where you are there, in which queue and  you have less transparency. And I would say it’s really about this regulation, but also really like the market design transparency on those topics

Adam Sroka (37:17) Yeah.

Stephan (37:29) are very much needed to  really get  the energy storage industry even further accelerated. I think honestly speaking, it’s less about the technology breakthroughs, right?  The current battery technologies which are out there, lithium ion, LFP cells, and  the moving to DC block,  a lot of those trends are good for the current serving of the current use cases, like one to four hour systems.

When we think about longer duration, eight hour system, it’s also possible, but therefore the costs have to come even further down, maybe to 50 euros per kilowatt hour. And I think then it also gets viable in these use cases, but we are not there. There are some examples, but we are not there in a lot of countries.

Adam Sroka (38:07) Yeah.

And what do you think for long duration storage then, what do you think are the biggest challenges to scaling?

Stephan (38:27)

So I think the biggest challenge still is that when you have the choice of investing in two hour system or four hour system, I mean, 95%, I think, are still one to four hour systems and most of them are systems. So you have to make an investment decision and you see  the

two hour system are way more profitable because it’s just  the spread in the day. You can cover a lot of  the profits with  a two hour system, for example, then it doesn’t make sense for you to invest into a long term, a long duration storage asset. So either you subsidise it somehow, which often is not the right way, or, on the other hand, you have to do some  market regulation that for example, like this backup power or  the capacity

for eight hours is  rewarded. But probably the biggest barriers still are the costs. Because when you look at an eight-hour system, it’s probably two to four times the capex, which you invest to. So the prices have to come down probably on the lithium iron side to 50 euros per kilowatt hours and below

that you can really see large deployments of eight-hour system of lithium-ion batteries. There are some technologies out there like sodium-ion or iron-air, which have the promise of maybe moving in that direction. And then you will also see that in long duration assets. But I would say right now it’s really  the competition that the others are just more economically feasible.

So as long as those markets are not saturated yet and you can earn money in those areas, you will always try first to bring those projects live, I would say. But we’ll see a difference in four or five years from now, or maybe even faster.

Adam Sroka (40:26) Have you got any  hot takes or anything controversial about the industry or

future predictions that we could get the inside scoop on?

Stephan (40:36) So for now, I would say it’s not a controversy, but I think most of the people still very much  underestimate how crucial availability of assets is and really bring the assets to highly available portfolios and covering this SOC imbalance, thermal imbalance, all of those kind of things

is hard work and I would say it’s also one of the big themes still for this whole year. And so we’ll see, we are doing a lot in this area of  performance management, but  we will see a lot more in the industry because every percentage you’re losing, you lose revenue, right? And you need to make sure that you squeeze the most out of your assets.

Adam Sroka (41:34) And if someone  falls in love with TWAICE listens to this podcast and was looking to kind of apply, what kind of people do you look for or skills you on the eye at the hunt for?

Stephan (41:44) When you’re interested in energy storage, but more  commercial minded, right? Like, let’s talk to us. On the other hand, also, you know that  battery expertise, data scientists, software engineers, and we are currently as a company operating across Europe,

in the US and also had first projects in Australia. The time zone shift. Exactly. You should be okay with some time zone shifts. Yeah, exactly.

Adam Sroka (42:03) That must be fun for you.

Yeah, you’re not allowed to like sleeping.

Very cool. Well, before I let anyone go, I always like to ask if people want to learn more about you, TWAICE, what you’re doing, or if there’s anything you’d like to promote or plug, where should we direct them?

Stephan (42:25) So I mean, a lot of events are coming up the next couple of months. Energy Storage Summit in London. There’s a Smarter E in Munich. Apart from that, on our website. We’re just launching this week, hopefully today, or tomorrow, our big survey, where we interviewed

around a hundred BESS experts and their main priorities on tools, on data and all of those kinds of things. And that’s a quite an interesting piece. So it’s definitely worth to watch out either on our website or some news now. It will be a good piece to really think through how you want to build up your tooling and your infrastructure and data strategy going forward when you scale up.

Adam Sroka (43:13) Amazing. Well, look, it’s been an absolute pleasure, Stephan. I’m sure we could nerd out about batteries in the BESS industry for quite a few more hours, but it’s been a pleasure to have you on today and wish you all the best with the lack of sleep and global expansion of TWAICE.

Stephan (43:26) Thank you, the pleasure was all mine, Adam. Great talking to

Adam Sroka (43:32) Brilliant conversation there with Stephan from TWAICE. Some of the stuff they are up to is really interesting. That piece around being able to simulate batteries and understand the longer term planning is really, really interesting and something a lot of the people we speak to struggle with, I think, and they’re interested in. The fact that, again, the value of going to like a third party that sees lots of different case studies.

And being able to identify like once in a million events and bring that experience to bear on your project is really, cool. And it lends itself to powerful forecasting models and  outlier detection and really clever solutions. Pleased to hear Stephan cement the fact that all of this domain really relies on a really strong data strategy, good foundations, like getting the technology

right. These kinds of assets, BESS assets are just so data hungry and technically a lot more complex than a lot of other asset classes. So it’s interesting to hear him reflect some of that experience that we had across the board. Altogether, look, fascinating company, really exciting journey they’ve been on. And one that I’ll definitely be keeping an eye on as they expand out to the US and Australia. So yeah, great episode.