The Swiss energy storage company that moved with fanfare into a sprawling former cigarette factory 16 months ago has found the fast startup it promised more like a slow trek.
Alevo employs about 140 people in Concord, not the 500 the company had projected within a year. The first of its 40-foot battery modules, expected to appear last July, has yet to roll off the production line.
And while the privately-held company says its finances are sound, unpaid contractors have filed $4.3 million in liens against Alevo. The company said Thursday it has received a new round of financing and will settle the claims next week.
“We’re a little behind where we expected it to be” when operations launched in October 2014, said Scott Schotter, chief marketing and sustainability officer. “At that time, we didn’t know what we didn’t know.”
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Alevo’s arrival at the site of a former Philip Morris USA plant, where workers once made Marlboro cigarettes, was a dose of good news for Concord and Cabarrus County officials. They had worked for years to recruit a buyer for the location. The plant’s closure cost the community thousands of jobs and a big chunk of its tax receipts.
Despite Alevo’s slow liftoff, the market it entered is real and growing. As more solar and wind power flows to the grid, for example, utilities are looking for ways to store the energy they produce in spurts. Batteries are one answer.
Goldman Sachs plans to invest $150 billion in renewable energy over the next decade, with energy storage a key component.
Alevo’s innovation is an inorganic electrolyte that means its lithium-ion batteries won’t catch fire or explode. The technology readily scales up to grid size, the company says, and can be recharged thousands of times.
Alevo describes its GridBank modules, which fit in shipping containers, as shock absorbers that soak up excess energy and release it as needed. Combined with analytic services Alevo also offers, the company says utilities could save millions of dollars by eliminating frequent power plant startups and shutdowns.
“We’re sold out into 2017,” said Jeff Gates, the global sales director Alevo hired from Duke Energy last year. Alevo won’t name its customers but says most are in the U.S., with one in Europe.
But the first GridBanks won’t be produced until spring, a timeline about twice as long as first projected.
Plant opened with fanfare
Gov. Pat McCrory and then-Commerce Secretary Sharon Decker were part of the four-hour opening ceremonies in late 2014. The former Philip Morris plant, set on an estate-like 2,000 acres, had once employed 2,500 people but had sat empty for five years.
Alevo, Concord Mayor Scott Padgett said that day, “may be the biggest economic development announcement since Philip Morris was announced.”
Records show Alevo bought the property from Philip Morris for $68.5 million under the name Victory Industrial Park, as the complex is now called, in April 2014. The complex was later sold to a company called Bootsmead LeaseCo LLC for $67 million, the records show. Alevo is the park’s tenant.
State filings show Bootsmead LeaseCo was formed in July 2014 by Wellford Tabor. The Charlotte banker previously worked for the private equity arm of Wachovia bank, which spun off to become Charlotte’s Pamlico Capital.
Tabor is the registered agent for a number of other companies, including a firm called Keeneland Capital. That firm “manages a series of investment partnerships that hold equity investments in public and private companies,” according to a filing with the secretary of state’s office. Tabor could not be reached for comment.
We’re a little behind where we expected it to be (when operations launched in October 2014). At that time, we didn’t know what we didn’t know.
Scott Schotter, chief marketing and sustainability officer with Alevo
Inside Alevo’s plant, golf carts whisper across gleaming parquet floors to ferry staff and visitors around the 2.3 million square feet. It uses about one-tenth of the space.
Partial production lines – battery anodes here, cathodes there – fill the corners of vast production floors. A lot of tinkering goes on there as Alevo translates technology born in European research-and-development labs into commercial production lines.
Machinery stacks electrodes into 6-inch cells that are welded shut. More than 14,000 cells will fill a GridBank, which can store 2 megawatts of electricity each.
The plant is believed to have the capacity for 20 production lines. Additional ones will be added as the market dictates, Alevo said.
The company initially predicted it would employ 2,500 people, matching Philip Morris within three years, and said the number could ultimately reach 6,000. It expected to spend $350 million to upfit the space.
Company says liens will be settled
Alevo was so sure of its future that it sought no state or local incentives to locate its manufacturing base in Concord.
Three months after its opening, the company announced a joint agreement to supply 200 megawatts of its modules to wholesale energy markets. Alevo called the agreement with Philadelphia-based Customized Energy Solutions the largest energy-storage deployment in the U.S.
But by this week, five contractors had liens in Cabarrus County against Alevo and Bootsmead totaling $4.3 million.
“All I can tell you is they’re not paying their bills. And why they’re not paying their bills, I can’t tell you,” said Jud Pheny, president of Addison Fabricators, an Alabama company. Addison said it is owed $130,000 for a stainless steel tank delivered in July.
Alevo has paid Greensboro-based Starr Electric $67,625 but still owes more than $90,000, Starr said in court filings.
Alevo says without elaborating that the problems were not solely its fault, but it apologized for the payment delays and said it would settle the liens next week. The largest filer, Matthews construction company Century Contractors, said it and Alevo have reached agreement to resolve a nearly $4 million lien.
Schotter said only Alevo’s timing, not its plans, have changed in Concord.
“We’re seeing daylight,” Gates added, “and it’s getting close enough that we know it’s not a train.”