Alevo, which has long promised its revolutionary lithium-ion battery technology would revolutionize utility-scale energy storage, filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court in the Middle District of North Carolina on Friday and laid off its 290 employees.
The company reported in its filing that it had between $10 million and $50 million in debts owed to 50 or more creditors. The number is balanced against somewhere between $1 million and $10 million in assets. Alevo’s website says it plans to liquidate all of its assets to pay off its creditors.
“Despite demonstrating the advantages of its groundbreaking battery technology, Alevo Manufacturing has had significant production challenges and thus insufficient revenue to continue operations,” a statement on the company’s website said. “The Alevo entities have actively sought new funding sources to finance their operations and growth strategies. Unfortunately, despite best efforts, the funding has not been realized in time to permit continued operations.”
According to its bankruptcy filings, its factory needs immediate attention because its factory “requires the utilities to detect and handle potentially hazardous gases and materials.”
“The chapter 11 filings are a very difficult, but necessary decision”, said Peter Heintzelman, chief financial officer of the Alevo entities, in a statement on the company’s website. “This decision was driven by the formidable challenges of bringing a new technology into commercial production and lacking the financial wherewithal to continue on through repeated manufacturing delays. It is a sad day for our dedicated employees and partners, as well as for the promise of Alevo’s technology.”
Sad indeed, though likely slightly more sad for the 290 workers who are losing their jobs than it is for Heintzelman. But those workers may have recourse.
A search of North Carolina’s Worker Adjustment and Retraining Notification Act (WARN Act) notifications indicate the company may have violated the federal law, which requires employers with 100 or more employees to provide 60 calendar-day advance notification of plant closings and mass layoffs of employees, as defined in the Act. Last time pv magazine checked, 290 is more than 100.
In similar cases in the solar industry – Suniva’s April bankruptcy, for example – the employees filed a class-action suite alleging violations of the Act. The case against Suniva is still pending.
It’s a rapid fall for the battery company, which announced in May it would be expanding its Concord, N.C., plant (where the layoffs are now happening). At that time, a press release on the company’s website touted its plans, saying “Alevo’s plans to add additional production lines and equipment at its battery manufacturing facility in Concord will create just over 200 jobs and invest $251.5 million into the local economy.”
The announcement came shortly after the Cabarrus County Board of Commissioners and Concord City Council supported the expansion and approved two 5-year, performance-based tax incentives totaling $4.3 million from Concord and $6.3 from Cabarrus County, according the same release.
Alevo once touted its technology on its website, claiming to bring “the first inorganic lithium battery to the commercial marketplace, bringing unprecedented attributes to the energy storage market. Due to its inorganic nature, the battery is non-flammable and creates minimal internal resistance.” It also claimed the batteries had/were:
- High discharge power rates and high pulse current conducive to electric grid applications;
- Fully dischargeable – the only lithium battery that offers 100% Depth of Discharge (DOD);
- Highly durable – can tolerate extreme temperature swings; and
- No calendric aging and can be stored in a complete discharged state.
Apparently, however, the market didn’t accept Alevo’s claims of technological superiority, which led to the bankruptcy filing last week.
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