Aquion Energy, once a rising star among manufacturers of large-scale energy storage systems, filed for Chapter 11 bankruptcy reorganization after struggling with raising funds from investors, venture capital monitor Tracxn said.
The Pittsburgh, Pennsylvania-based company said it was hopeful to find a buyer and emerge from bankruptcy “in the coming weeks.” Ahead of the filing it had laid off about 80 percent of its personnel, keeping only a core research and development team.
“Creating a new electrochemistry and an associated battery platform at commercial scale is extremely complex, time-consuming, and very capital intensive,” read a statement jointly attributed to Scott Pearson, Aquion’s outgoing chief executive officer, and Suzanne Roski, a managing director at Protiviti, a Virginia-based consulting firm.
Ms. Roski was named Aquion Energy’s chief restructuring officer during the bankruptcy.
The statement continued, “Despite our best efforts to fund the company and continue to fuel our growth, the company has been unable to raise the growth capital needed to continue operating as a going concern.” Aquion could not be reached for comment beyond its statement.
The bankruptcy filing comes as the Lawrenceville-based manufacturer of sodium-ion batteries – which can be produced from seawater – had apparently found success in deploying its technology. It generated hype and awards for its innovation, attracting investors along the way, including an investment of reportedly close to $190 million from Microsoft founder Bill Gates.
Batteries like Aquion’s are considered the “holy grail” for widespread renewable energy development because they can store large amounts of energy for use during times when it is not easily produced — such as when the sun is not shining or when the wind is not blowing, the Tracxn report explained.
In its statement announcing the bankruptcy, the company continued to tout those accolades.
“Over its seven years of operation, Aquion has created a very promising energy storage platform and has proven that it can build a compelling product,” Mr. Pearson wrote.
He added, “a bankruptcy sale creates a unique opportunity for the right strategic buyer that can deploy transformative capital and synergies onto Aquion.”
Market analysts suggested the bankruptcy was not entirely surprising and that Aquion Energy deserved the praise.
“Aquion’s claim isn’t entirely incorrect — it was furthest along among the emerging storage technology cohort, with proven technological capabilities,” wrote Ravi Manghani, a Boston-based director of energy storage for GTM Research, a market research firm studying trends in green technology, in a post on the firm’s blog shortly after news of the bankruptcy.
But he said the financial challenges of surviving in this market are “not for the faint-hearted,” requiring “huge amounts of capital” to scale up and stay relevant.
“I wouldn’t be surprised if it finds a good strategic buyer that’s entrenched in the off-grid or microgrid business, both of which would be a good market fit for Aquion’s chemistry.”