Group14 CEO & Co-Founder Rick Luebbe joins Yahoo Finance Live to discuss electric vehicle adoption, raising $400 miliion in funding led by Porsche, and the outlook for lithium-silicon batteries.
AKIKO FUJITA: Well, as electric vehicle adoption accelerates, battery technology is increasingly critical for those EV makers as they seek more power, less weight, and cheaper costs. Our next guest thinks his company could have the solution with lithium silicon battery technology, which could also prove useful solving other power problems like grid storage. Let's bring in Rick Luebbe. He is Group14 CEO and co-founder. He's joining us from Woodinville, Washington today. Rick, it's good to talk to you.
Let's start by laying out for those who are not as familiar with the technology, how does lithium silicon battery differ from lithium ion, which is something that I think a lot more people are familiar with?
RICK LUEBBE: Sure. Hi, Akiko. Actually, I'm joining you today from Germany. I'm here visiting with customers and partners, following up the announcement of the investment from Porsche. But a little bit about silicon battery technology, you know, it's really a transformational technology relative to what we understand and the performance we get from lithium ion. So it's a very different chemistry on the anode, the anode part of the battery. It enables much higher energy density, so up to 50% more range in an EV, for example. And much charger-- much faster charge rates, and so with the silicon battery, you could potentially completely recharge your EV in less than 10 minutes, maybe even as fast as five minutes.
AKIKO FUJITA: So let's talk about that investment you announced last week, $400 million from Porsche. What do you plan to do with that money? And how significant is that when you've got a big brand like Porsche saying, look, we are in on this technology, too?
RICK LUEBBE: We are really excited to have the validation of a company like Porsche making this lead investment in our Series C. You know, they are known for their technological leadership, as well as being just a fantastic automotive brand in general. With this round, with this funding, we're now going to be able to scale up our commercial production capacity to the point where we can actually support large scale EV programs. We have a commercial facility today in Woodinville. But that's not quite big enough to support to an automotive scale.
And so Porsche recognizes that silicon battery technology is in their future. They want to access our technology. And this investment is going to help us build a large scale factory in Washington to support those needs. In fact, this factory, when it comes online, should be able to produce enough material to support an annual production of 600,000 EVs based on silicon batteries.
AKIKO FUJITA: So, Rick, one of the big concerns with lithium silicon batteries is the swelling that happens with the charging and the battery life itself. I mean, how far are we from actually addressing that? And how rapidly would you be able to ramp up production once that's addressed?
RICK LUEBBE: So the industry's been trying to make silicon batteries work for at least 15 years. But you're right. Because the silicon doesn't respond very well to the charge cycles, it affects the cycle life. And so they really haven't been commercially viable. We have solved that problem with our silicon carbon composite that stabilizes the silicon, controls that swelling, and makes it last as long as the traditional lithium ion battery.
AKIKO FUJITA: So Rick, you know, I wonder if you can help us understand just how rapidly the adoption is happening. You know, we often sort of see this as one technology or the other. But it sounds like the reality is, given the bold targets that are out there, whether it's in the US or in Germany where you are, that you've got to have not just lithium ion, but lithium silicon kind of move in tandem. Can you talk about the sheer demand that you're looking to as we see adoption ramp up?
RICK LUEBBE: We're envisioning virtually the entire industry transitioning to silicon-based batteries within the next three or four or five years. You know, today, we've got a commercial facility here, as I mentioned, in Woodinville. The next scale facility is going to enable the kind of demand that we're envisioning from our customers. And we'll expand upon that. For example, we also have a joint venture with SK Group to establish a manufacturing factory in Korea. Provides dual sourcing, also provides more capacity. We really think that this is going to enable the entire industry to transition to silicon batteries, and certainly by the end of the decade.
AKIKO FUJITA: What about the use of the technology in grid storage? And we heard last week, California, as well as Texas, warned about constraints on their power grid, as they look to temperatures rising, too. I mean, that felt like a real reality check about how the transition from fossil fuels into renewables isn't quite there. But that bridge could be battery storage itself. Where do you see Group14 playing in that space?
RICK LUEBBE: You know, the value proposition for silicon batteries applies to all these applications. So when you look at things like improved energy density, faster charge rates, and really lower cost, you know, from $1 per kilowatt hour perspective, that's the value prop that everybody wants in all their energy storage applications. Silicon batteries will enable electric aviation. Silicon batteries will enable broader deployment of grid storage. This is a fundamental transformational technology for the energy storage industry.