Electrovaya's (EFLVF) lithium-ion batteries are less expensive than a fuel cell, replacing the need for hydrogen storage with the existing, well-established electric grid.
Recently, Electrovaya announced that it is working with Wal-Mart (WMT) and others in the distribution and warehousing field by supplying its lithium-ion batteries for forklift truck propulsion. This industry, which is driven towards productivity, until recently was controlled by lead-acid batteries to power its electric forklift trucks.
The limitations of the lead-acid battery are legendary so that recently there was a move by Plug Power (PLUG) to replace lead-acid with their fuel cell. So, the key question is whether Electrovaya's lithium-ion battery offers a superior performance and can displace both fuel cells and lead-acid battery power?
There are several reasons why Electrovaya's most recent V2.0 SuperPolymer is superior to both of these alternatives.
1. Efficiency
Lead-acid battery problems of low efficiency, voltage drop, low cycle life and long charging time add to the environmental challenges of hydrogen, acid and lead in the environment.
In the case of fuel cells, poor energy efficiency is a fact of life. The various steps in the well-to-wheel cycle, including electrolysis, transmission and conversion via the fuel cell causes energy losses so that typical round trip efficiencies barely exceed 20%.
2. The Production Process
The conventional lithium-ion production process uses toxic chemicals which increase costs while at the same time present barriers to manufacturing. This has led to failures in North American and European manufacturing which can be attributed, at least in part, to the more stringent environmental regulations in these regions.
This has been the cause of the demise of Dow (DOW), A123 and others, while California's strict environmental legislation could be a deterrent to companies planning to produce lithium batteries in that State. In contrast, Electrovaya's proprietary (>100 patents) green process uses no toxic chemicals and allows local low-cost manufacturing with absolute freedom to produce anywhere in North America and Europe.
3. Competition
Fuel cells were long promoted as the future for electric cars and wide media promotion of the fuel cell car concept enabled companies such as Ballard (BLDP) to reach a lofty market cap of $20 billion. The present day reality is that lithium-ion batteries dominate the electric car market. Millions of Toyota (TM), Nissan (OTCPK:NSANY), Tesla (TSLA), BMWs (ETR:BMW) and Mercedes (DDAIF) electric vehicles are powered by lithium-ion batteries with only a tiny handful of concept fuel cell vehicles to be seen. The obvious question is whether the same domination will take place in the warehousing and distribution industries? The reasons that caused the failure of fuel cells in the electric vehicle market still exist today and lead to the obvious conclusion that lithium-ion will offer similar obvious benefits in the warehousing forklift truck market.
4. Lithium-ion Performance
A shift to lithium-ion could enable a quantum leap in performance for an electric vehicle in warehousing and distribution. The clear benefits over fuel cells include higher energy efficiency, lowest energy costs, fast charging, long running time, high power, and ease of supporting a three-shift operation, 24x7. Additional benefits include clean manufacturing, increased productivity, the ease of introducing opportunity charging if needed, all contributing to the lowest carbon footprint.
5. Electrovaya Shareholder Value
The performance of Electrovaya's state-of-the-art V2.0 lithium-ion, along with a portfolio of leading industry clients, has uniquely preserved the company's shareholder values, while shareholders have seen little dilution over the last 10 years. For comparison, Plug Power has seen a 1100% dilution since 2011, while for Electrovaya the figure is less than 15%.
Conclusions
Based on the above evidence, Electrovaya believes that it will become a leading player in providing electric forklift power in the warehousing and distribution industries.
Editor's Note: This article covers one or more microcap stocks. Please be aware of the risks associated with these stocks.
