Interview with the CEO

SaltX is now raising additional capital. Why?
There are two reasons why SaltX needs additional capital to best use our patented solution to store thermal energy in salt:

First, it has taken longer than we previously estimated to start selling our Nano Coated Salt, although the interest has been, and still is, high.

Secondly, we want to take advantage of this historical time window that is currently in the market, the market situation means we need to increase the rate further. We see great opportunities to create shareholder value our, which we may risk losing with the current rate of development.

The interest in large-scale energy storage accelerates. When the world transitions to renewable energy, other forms of energy storage need to be developed and started to be sold. Here, SaltX offers a solution that is effective both in terms of storage capacity and costs.

At the beginning of 2017, when you received approximately 100 MSEK, you said that the money would suffice to be cash-flow-positive. What went wrong?
Nothing has gone wrong. However, we can say that it took longer to develop the application areas we worked - and still work - with our partners.

As we have decided on a focused strategy based on actively promoting the development and sale of large-scale energy storage - EnerStore - it will be a consequence that the continued development of our other applications - SunCool, HeatBoost and VerdAcc - will change a lot and we choose to continue the development work for these applications within what we call SaltX Labs.

SaltX Labs is a platform which means that we support partner companies such as NSECT (SunCool), Rheem (HeatBoost) and MCC (VerdAcc) in their product development, but the responsibility to drive development lies with them. We usually resemble this way of working on how Intel works against computer manufacturers to integrate their components. More details on how SaltX Labs works is described in the upcoming prospectus.

How are you going to use the proceeds?
We will focus on two segments within EnerStore: The first priority is the solution we make in the pilot project with Vattenfall in Berlin, where we save surplus energy from wind power, which can then be used as district heating. We will take this reference facility and market the solution actively in our three target markets - Germany, the US and China.

We will further develop this concept to show how EnerStore can store heat and convert it into steam to heat or power a turbine that generates electricity. A more detailed description of this is found in the prospectus. 

Who are the customers?
Those who use renewable energy and want to lower their costs by storing energy. These are often energy companies but can also be industries, companies, real estate and buildings that use smaller networks - so-called micro grids - where you switch to renewable energy. An increasing number of large companies such as Apple, Google and Volvo are now making long-term commitment to completely fossil-free operations and manufacturing. Large-scale energy storage is needed, especially when lithium-ion batteries become too expensive.

Should I interpret it as you see lithium-ion batteries as a competing solution?
No, as we said earlier, it is rather a complement: batteries are good for smoothing out fluctuations in the network for shorter periods, usually minutes and maximum up to an hour or two. SaltX takes care of when the energy is stored for a longer period of time, from 6 to 10 hours up to 36 hours. Here we estimate that SaltX offers the most competitive solution in the market in terms of cost and efficiency. 

How would you describe that SaltX has developed operationally?
We have matured commercially - and now have a clear strategy for how to build and implement our sales step by step. At the same time, we have strengthened our organization, which means we have the right skills to launch EnerStore.

You now choose to focus almost entirely on EnerStore. Why?
We see that, without doubt, the biggest commercial potential is for large-scale energy storage. We estimate that a major part of our future revenue comes from EnerStore and a smaller part from our other applications.

When do you judge EnerStore to start selling?
When the Vattenfall pilot project is completed, we enter the commercial launch phase, which we expect will happen in 2019.

How dependent are you of Vattenfall choosing to continue investing in EnerStore?
We are not dependent on Vattenfall continuing with us after the pilot project. There are additional energy companies involved in the project, and partly in-depth discussions with a large number of energy companies and companies following the pilot project. The important thing is that it becomes clear to the market that our energy storage solution works on a large scale.

But of course, we would like Vattenfall to proceed after the pilot project and order a full-scale system. That's what's the goal, and what we're working for.

What happens if Vattenfall chooses to end or delay the bet on EnerStore?
As we said, we want Vattenfall to continue. But we do not entirely depend on them. The important thing about the Vattenfall project is to make it clear to the outside world, including other potential customers, that our energy storage solution works on a large scale.

The other applications are less prioritized - why?
It is a purely commercial assessment that we focus on large-scale energy storage. In practice, we can take advantage of the commercial interests that exist for other applications through SaltX Labs, as it is about supporting our partners and customers in their product development. SaltX Labs is a good environment and platform to continue developing and commercializing these applications.

Why has none of these applications been successful?
We can only say that it took longer than we thought. This is mainly because our partners and customers, who are at the end responsible for developing these applications, need more time before launching their products with our nano-coated salt. Our partners and customers are often large organizations and they report continued interest in our solution. Unfortunately, we cannot determine what rate customers choose to develop and then launch their products. Our role is to support them wholeheartedly in product development and then sell our nano-coated salt to these customers.

What happens to SunAct's solar order in Ghana?
Our solution should be ideal for African sunny countries with poor electricity supply. The local interest is very large. However, the banking system in Ghana is in poor condition and this kind of health investment, like much else, is dependent on international funding support. I am more skeptical now than before that the financing can be secured near term, which is a prerequisite for the deal.

About SunAct, there are rumors and speculations that SaltX founder Göran Bolin would be owner or involved in the SunActs Board. Is it true?
No, that is not true. Neither Göran nor SaltX employees today have any relationships with SunAct, which may cause conflicts of interest. There have also been no related party transactions other than what SaltX has accounted for. 

It seems as if there are many challenges – why will SaltX succeed?
I see these challenges as opportunities. With large, reputable partners, world-patented technology and a strong team, we have good opportunities to successfully take part of the global energy storage market.

Now you receive more than SEK 100m in new capital in a rights issue - something you want to comment on?
I am pleased that we have created a good structure for this raising of capital, supported by our two largest shareholders, Industrifonden and Skirner, which participate in the issue and a group of investors that guarantee the remaining share of the issue. Consequently, the amount is secured, meaning that each shareholder can be confident in considering the subscription of his/her share. We hope everyone will want to participate and we have also created room for more shares and more capital if interest would be great.