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U.S-based sustainable zinc-based energy storage solutions provider Eos Energy Enterprises reported a net loss of $70.7 million for the third quarter (Q3) of 2022 due to the ongoing production ramp-up of Z3 batteries, higher logistics costs, and challenges posed by strained supply chains and staffing shortages.
According to Eos Energy, the company’s welder deliveries were delayed by 8-12 weeks owing to the global chip and personnel shortages at manufacturers of capital equipment, resulting in losses.
The company’s new battery frame molds and resin supplier qualification were delayed due to the capacity expansion resulting in lower yield, and higher scrap clubbed with rework.
Eos Energy’s revenue for Q3 stood at $6.1 million, a sequential surge of 3.3% from $5.9 million.
The company said it shipped 258 energy blocks, including over 80 MWh of blocks, to the Pine Gate Eastover project, which it said is Eos’ largest project to date, with 184 energy blocks delivered. Eos has discharged total energy of 640 MWh for the project, of which over 50% was from its assets in the field.
Eos said it has $324.8 million booked orders in the pipeline representing a capacity of 123 GWh, with an order backlog for 1.8 GWh capacity totaling $452.2 million. The company projects that by the end of 2022, it will have booked orders worth $500 million, as its current opportunity pipeline is up from $323 million in the previous quarter.
The company’s CEO, Joe Mastrangelo, said, “We continued to ramp up production in the most challenging supply chain environment of my career. We have produced 258 Energy Blocks since opening our factory in August 2019. It took 33 months to produce our first 100 and just six months to manufacture the next 158. At the same time, our technology team took our time-tested chemistry and packaged it into our Eos Z3 product that will double performance at 50% lower cost.”
Eos affirmed that it aims to reduce output on its current generation product and launch Eos Z3 in 2023 to utilize better benefits of the Inflation Reduction Act (IRA) for the company and its customers.
With the introduction of the IRA, Eos expects to avail $35 kWh as a tax credit for producing battery cells and $10/ kWh as a tax credit for battery module manufacturing.
The company aims for cost reduction in producing modules as the cells in the new modules have an improved voltage with 12.5% higher discharge and will have a 33% increased output.
Eos said it reduced its capital expenditure by $3 million by aligning processes to increase the output over the current asset base.
Eos Energy reported a net loss of $45.1 million in the first quarter of 2022, while its revenue rose by 6.5% to $3.1 million.