Periodic Reporting for period 1 - Heatrix (A renewable Power-to-Heat technology to decarbonize heavy industry)
Reporting period: 2023-07-01 to 2023-12-31
Heatrix is a young deep-tech climate startup based in Bremen, Germany. Its mission is to competitively replace fossil fuels in energy-intensive industries by converting renewable electricity into storable, process heat up to 1500°C. The Heatrix system combines an innovative high-temperature electric heater, utilizing off-grid solar or wind electricity, with a thermal energy storage to provide continuous high-temperature process heat with zero emissions. Heatrix's modular approach, where heater and storage are fitted into standardized container systems, enables rapid deployment and easy integration into existing plants with minimal retrofitting requirements. Heatrix combines cutting-edge scientific findings with mature technologies and equipment to benefit from economies of scale. Customers can implement the Heatrix system in a phased approach in line with market demand for green products and the availability of renewable electricity.
To ensure applicability of Heatrix technology, a very early engagement with industry partners is crucial. The main objective of the proposed project is therefore to build and strengthen the relationship to industry customers and develop a joint feasibility study on a representative use case.
To ensure applicability of Heatrix technology, a very early engagement with industry partners is crucial. The main objective of the proposed project is therefore to build and strengthen the relationship to industry customers and develop a joint feasibility study on a representative use case.
Within the project duration of 6 months, four main activities were conducted: (1) process screening, (2) partner acquisition, (3) elaborating a feasibility study and (4) business model development.
The main activity in task 1 was to screen relevant industrial processes based on literature and web research to identify promising industry sectors for a Heatrix application. Several processes within the bricks, aluminium, cement and lime industry could be determined as suitable first applications due to favourable process parameters and requirements. Those processes include shaft furnaces within lime production, tunnel ovens within brick manufacturing or drying plants within cement production.
Based on the results of task 1, talks with promising industrial partners were initiated by taking part on relevant events such as “VINCI Startup Speed Dating”, “Husum Wind”, “Härterei Kongress” or “Lausitzer Fachkonferenz”. Insights from those events were invaluable while establishing meaningful connections and boosting Heatrix's visibility in the industrial heat space. Moreover, leveraging the connections forged at previous events, up to 10 Letters of Intent (LOI) from prospective customers could be secured, expressing keen interest in collaborating on and executing pilot projects.
The feasibility study was conducted in close collaboration with an industrial partner from the cement industry. Thorough discussions on requirements and boundary conditions took place, and the requisite data was exchanged. As the economic feasibility of the use case was an imperative consideration for the industrial partner in determining the viability of Heatrix system an existing in-house cost model was enhanced and refined focusing on estimating the Levelized Cost of Heat (LCOH) generated by the Heatrix system. The results showed that in the current energy cost scenario, the Heatrix system is not yet economically comparable to natural gas. However, a prospective decline in electricity costs is expected. Considering this outlook, the LCOH could be lower than the fuel price, already with a 20% reduction in the current mean electricity price. A noteworthy energy cost savings of 34% can be achieved with a payback period of three years, assuming a 40% reduction in current mean electricity prices.
Supported by an experienced EU-coach Heatrix's business model and go-to-market strategy could be refined and elaborated in more detail. By adopting a customer-centric perspective and moving beyond technical details, Heatrix's value proposition for customers could be strengtened, bridging the gap between impressive public relations efforts and the necessity for clear, concise arguments outlining how Heatrix generates commercial value.
The main activity in task 1 was to screen relevant industrial processes based on literature and web research to identify promising industry sectors for a Heatrix application. Several processes within the bricks, aluminium, cement and lime industry could be determined as suitable first applications due to favourable process parameters and requirements. Those processes include shaft furnaces within lime production, tunnel ovens within brick manufacturing or drying plants within cement production.
Based on the results of task 1, talks with promising industrial partners were initiated by taking part on relevant events such as “VINCI Startup Speed Dating”, “Husum Wind”, “Härterei Kongress” or “Lausitzer Fachkonferenz”. Insights from those events were invaluable while establishing meaningful connections and boosting Heatrix's visibility in the industrial heat space. Moreover, leveraging the connections forged at previous events, up to 10 Letters of Intent (LOI) from prospective customers could be secured, expressing keen interest in collaborating on and executing pilot projects.
The feasibility study was conducted in close collaboration with an industrial partner from the cement industry. Thorough discussions on requirements and boundary conditions took place, and the requisite data was exchanged. As the economic feasibility of the use case was an imperative consideration for the industrial partner in determining the viability of Heatrix system an existing in-house cost model was enhanced and refined focusing on estimating the Levelized Cost of Heat (LCOH) generated by the Heatrix system. The results showed that in the current energy cost scenario, the Heatrix system is not yet economically comparable to natural gas. However, a prospective decline in electricity costs is expected. Considering this outlook, the LCOH could be lower than the fuel price, already with a 20% reduction in the current mean electricity price. A noteworthy energy cost savings of 34% can be achieved with a payback period of three years, assuming a 40% reduction in current mean electricity prices.
Supported by an experienced EU-coach Heatrix's business model and go-to-market strategy could be refined and elaborated in more detail. By adopting a customer-centric perspective and moving beyond technical details, Heatrix's value proposition for customers could be strengtened, bridging the gap between impressive public relations efforts and the necessity for clear, concise arguments outlining how Heatrix generates commercial value.
The project has successfully achieved two pivotal milestones: firstly, the identification and collaboration with industrial partners, confirmed through signed Letters of Intent (LOI), and secondly, the execution of a comprehensive joint feasibility study. The latter, in particular, marked a significant achievement as it provided unprecedented insights into the economic aspects of implementing a Heatrix system in a tangible use case within the current European energy market.
While the initial results from the feasibility study indicate that Heatrix may not be economically viable at present, it is noteworthy that this study serves as the first detailed exploration of the system's economic potential in a real-world context. Considering the anticipated decline in electricity prices over the coming years, aligned with Europe's ambitious net-zero goals, it becomes evident that Heatrix could emerge as a viable solution for energy-intensive companies seeking to decarbonize their process heat demands.
Simultaneously, the project recognizes the importance of validating technical feasibility. Building upon the findings of the feasibility study, the next phase involves the design of a pilot plant. This initiative aims to address technical questions related to the integration and operation of the Heatrix system in a practical application.
While the initial results from the feasibility study indicate that Heatrix may not be economically viable at present, it is noteworthy that this study serves as the first detailed exploration of the system's economic potential in a real-world context. Considering the anticipated decline in electricity prices over the coming years, aligned with Europe's ambitious net-zero goals, it becomes evident that Heatrix could emerge as a viable solution for energy-intensive companies seeking to decarbonize their process heat demands.
Simultaneously, the project recognizes the importance of validating technical feasibility. Building upon the findings of the feasibility study, the next phase involves the design of a pilot plant. This initiative aims to address technical questions related to the integration and operation of the Heatrix system in a practical application.