(Boursier.com) — ENERTIME, a French “CleanTech” company serving industrial energy efficiency and geothermal energy production, takes stock of the company’s progress.
The very significant increase in the price of electricity on the European spot market will continue in 2022 with prices rarely below 200 euros/MWh. This market price ultimately determines a large part of the electricity purchase contracts in Europe. The delay in commissioning new basic electricity production capacities combined with the electrification of industrial processes and mobility can only accelerate the risk of electricity shortages. This increase and this risk of shortage confirm ENERTIME’s strategy of offering high-power electrical energy efficiency solutions.
In this context, ENERTIME is currently taking part in numerous calls for tender relating to the implementation of ORC (“Organic Rankine Cycle”) systems in order to reduce the electricity consumption of European industrialists.
UPDATE ON CURRENT PROJECTS
In France
ENERTIME was selected by ADEME for 3 investment projects in ORC systems, led by its subsidiary ÉNERGIE CIRCULAIRE: Énergie Grande-Synthe for FerroGlobe (Nord), Énergie Lagnieu (Ain) for Verallia and Énergie Fouquières for Recytech (Not -de-Calais). The FerroGlobe project subsidy contract has been signed with ADEME, that relating to the Verallia project has been validated by ADEME and is in the process of being signed, and discussions on the Recytech project contract will start soon.
A fourth project was submitted in October 2021 for ADEME financing as part of the energy efficiency/decarbonization calls for projects of the France Relance plan and the Company is preparing to participate in new support mechanisms for energy efficiency in France. The objective is to sign at least two Corporate PPA type contracts (power purchase agreements, contracts for the sale of electricity to companies) with industrial customers during the first half of 2022 and at least two others between the second half of 2022 and 2023. These 4 contracts represent an amount of potential orders for ENERTIME of around 25 ME.
In Europe
ENERTIME has responded or is in the process of responding to calls for tenders relating to the supply of ORC on “turnkey” waste heat recovery projects in Poland, Romania, Greece, Germany, Italy and Spain. These various projects mainly concern installations in glassworks and cement works, some of which are developed on an ESCO (Energy Service Company) model.
In Turkey
ENERTIME has submitted or is about to submit several offers of high power ORC systems for turnkey projects in waste heat recovery in partnership with a Chinese company which is in charge of the “turnkey” installation. The Company is confident in its ability to sign equipment supply contracts in 2022 with this Chinese partner.
In North America
The FASEP study contract (Fund for studies and assistance to the private sector) with CFE, the Mexican national electricity company, is progressing according to schedule and has made it possible to identify several large-scale projects. The Company also works with Mexican industrial customers on plant equipment. In the United States, due to the 26% Investment Tax Credit granted to waste heat recovery projects in the country since the end of 2020, the Company is interested in this market.
In Asia
The Covid-19 pandemic continues to impact Asia as a whole and to slow down the Company’s commercial efforts in this region. ENERTIME is currently focusing on Thailand, China and India. The Company is also exploring new opportunities in Central Asia.
INNOVATION
European projects
The Company is part of a voluntary process to improve its technical offer ORC and Industrial Heat Pumps above 100oC and to promote its innovative solutions on a European scale. To finance these developments and promote the Company and its ESCO offer, ENERTIME submitted two European grant applications in consortium with European companies and laboratories within the framework of the Horizon Europe program, a very competitive but very well-funded program. These two projects, DECAGONE for ORCs and PUSH2HEAT for high-temperature heat pumps, have been selected by the European Commission (see press release of January 19, 2022) and will be the subject of subsidies of up to 8.5 MEUR paid over four years with an initial installment of around 25% upon signature of the financing agreement scheduled for September 2022 at the latest.
Electricity storage
The Company is currently in discussion to take a minority stake in STOLECT in order to be referenced as the preferred supplier of the turbines and compressors required for STOLECT facilities. This investment would be associated with an engineering order for the definition of the turbomachines of the first STOLECT project planned in Rennes, the financing of which is partly secured.
through a European subsidy within the framework of the ERDF programme. STOLECT is planning a second fundraiser at the end of 2022/beginning of 2023 to complete the financing of this first project. ENERTIME is not intended to participate in this second operation.
Hydrogen
The Company has launched the development of a very high pressure hydrogen compressor (see press release of November 29, 2021), intended for the energy storage and mobility market. As such, ENERTIME has obtained funding from the Île-de-France Region and BPI France as part of the Innov’up program which allows it to validate the proof of concept with the objective of carrying out an industrial pilot from 2023.
UPDATE ON 2021 RESULTS FORECASTS
The Company currently has in operation 6 ORC machines for 9 MW installed, 2 ORC machines for 2.9 MW in commissioning/assembly and a 2.5 MW gas expansion turbine at the start of commissioning. Recurring revenue related to the maintenance and after-sales service of these machines should represent approximately 200,000 euros for the 2022 financial year. The effects of the Covid-19 health crisis persisted in the second half of 2021, thus the results for the second half of 2021 should be close to those published in the first half of 2021. However, with regard to the projects under development, in particular via the Energie Circulaire subsidiary, ENERTIME remains confident in its ability to record a significant increase in its turnover in over the next few years, which should make it possible to achieve a break-even operating performance in 2023.
FINANCING OF THE COMPANY AND ITS SUBSIDIARY ENERGIE CIRCULAIRE
The Company has mandated the consulting firm Echosys Advisory to support it in arranging the necessary financing for the ORC projects carried out by its subsidiary Energie Circulaire in France and abroad. The targeted financing could represent a total amount of €25 million and could be realized in capital or short and long-term debt.
Furthermore, in order to support the expected growth, ENERTIME plans to strengthen its equity through a capital increase of several million euros in the coming months.