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The idea originated with Donald Sadoway, a chemistry professor at MIT, and Gerbrand Ceder, a professor of materials science at MIT, who wondered if it might be possible to essentially reverse processes like those used to make aluminum. For example, electricity is used to produce aluminum from aluminum oxide—if that chemical reaction could run the other way, it would produce electricity, and the system would function as a battery. Sadoway’s graduate student, David Bradwell, found a way to get the electricity that’s put into the process back out again.

The company believes the design can be built in existing factories with contract manufacturing, and since there’s no need to build its own factories at first, its capital costs would be greatly reduced. Still, until the technology reaches mass production, its costs will be relatively high. This is where a bit of market savvy is important. The founder’s decision to build batteries that are not only capable of storing large amounts of energy at low-cost, but can also respond in milliseconds, will give it access to markets where it can charge high prices for storing and delivering power to the grid to make up for fluctuations in supply and demand—something that’s becoming important as more wind and solar power, which are intermittent, is installed.

As the production scale increases and costs come down, Liquid Metal plans to serve larger-scale markets, such as buying cheap electricity at night and selling it in the middle of the day, when prices are higher. Because the technology is flexible the company can decide how to use its battery capacity, always picking the most lucrative market.

Liquid Metal plans to take advantage of two opportunities created by the government. The first is actually a product of deregulation: the government set up framework for establishing open markets for power. This allows the company to register as an independent power provider without going through a utility or getting regulators to allow utilities to charge for the service. This gives even a small company  a clear path to earning money. The company could also benefit from a ruling by the Federal Energy Regulatory Commission that technologies with fast response times can be paid more for their services. This could give such technologies an edge over existing power plants, which can take several minutes to respond.

Liquid Metal Battery still faces challenges, such as confirming that its cells are durable enough to make the economics work out. Even with relatively low capital costs, it may need to call on partners, such as Total, for help not only with funding, but also for experience in large-scale operations. Liquid Metal plans to announce new funding—this time from venture capitalists—in the coming weeks.

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