Rebecca Boll: ‘Fluence is attracting great talent’

• Fluence went public last year - revenue expected to hit $1.1bn in 2022
  
• Company has hired 350 people in last six months
  
• Growth expected in Europe and Asia, but raw materials costs soaring

This week, US-headquartered energy storage products, services and digital applications company Fluence announced record revenues.

In the second quarter of its current financial year, the company posted a whopping $343 million in revenue, up a massive 249 per cent on the same quarter last year.

Momentum is clearly with Washington DC-based Fluence, which is now on course for annual revenue of around $1.1 billion in 2022 after its IPO in October last year. The company now totals more than 800 employees having recruited around 350 staff in the last six months.

Approximately half of the company’s business is in the US, but Fluence anticipates significant commercial expansion in the EMEA and APAC markets.

One member of the leadership team guiding the company through this period of rapid growth is Rebecca Boll, Fluence’s SVP, chief product officer.

Energy Storage Report spoke to Boll – who was recently named in Energy Storage Report’s ‘Top 40 Women Leaders in Energy Storage’ – about the company’s IPO, its rapid growth, Fluence’s recent acquisition of renewable energy artificial intelligence company Nispera, and the company’s recruitment drive.

In a wide-ranging interview, Boll also discussed supply chain challenges, opportunities in Europe and Asia, as well as what can be done to boost women’s participation in the energy storage industry.

What would you highlight as the most significant recent developments at Fluence?

Rebecca Boll: An obvious highlight was taking the company public in October last year. Having been one of the people that went through that with the investment community, the excitement and the belief in renewable energy and the belief in its importance to the world is very closely aligned with our mission. The world believes that we are moving to renewable power and most people understand that energy storage is a must in order to make that happen. You can't have wind and solar without some sort of energy storage. We’ve gone from a company with less than $50 million of revenue to $1 billion. What changes is suddenly we're a public company. So we have commitments to people that invested in us.

[US President Biden's] ‘Build Back Better’ plan is definitely on a heavy pause – it seemed more positive at the time of the IPO than it does right now. Recently, our government put out an announcement to put more stimulus into the manufacturing of batteries in the country, so that’s a good step forward, but it's not quite the same kind of financial incentives that were contemplated in ‘Build Back Better’. Yet, we had record orders in our second quarter and, so in this environment, when there’s a lot of questions out there in the market, we still have demand and our pipeline has not changed. We had record orders for both our physical energy storage products and our digital solutions. We had such a good quarter two that we’ve achieved our entire year’s goals for both revenue and assets under management in our digital business.

We also just bought Nispera [a Zurich-based provider of artificial intelligence and machine learning-enabled software-as-a-service targeting the renewable energy sector]. They complement our strategy and the acquisition accelerates our digital roadmap - the integration with Fluence Digital is going very well.

Another highlight is that, in this fiscal year – which starts in October – we’ve hired 350 people, which is an incredible number. Some have come from other major, impressive technology companies. We’re getting this great talent here across the board, whether it’s specialists in battery management systems, or specialists in artificial intelligence or core systems engineering. We seem to attract talent really well, which I think is due to our mission - tackling climate change and changing the way we power the world. We also have diversity targets and we’re meeting those targets and making sure our population is diverse.

What are currently the biggest opportunities for Fluence? 

RB: The REPowerEU initiative [a European Union plan to make Europe completely independent from Russian fossil fuels by 2030], energy storage will be critical in that roadmap and we’re a leader in Europe right now and we have a partnership with the European battery player Northvolt. We expect our portfolio in Europe to grow because of that. We are doing business case modelling by country and other markets that look attractive are the Philippines and Taiwan. India is also an opportunity for us, it’s an emerging market and we've announced a joint venture with ReNew Power in India.

What are the biggest challenges Fluence currently faces?

RB: Supply chain. The overall management of capacity of the supply chain, how we procure the critical things that we need to make our products. We have locked up our supply chain for the next two years, but it's a challenge. The truth is that, at this moment in time, most batteries come from China, so we are fortunate that we have this battery relationship with this emerging company [Northvolt] in Europe. We have batteries coming to us, a significant amount of batteries in Europe in 2023. Meanwhile, we have more than one relationship in Asia – we have batteries from China and Korea, but where we don't have batteries is in the Americas. The most attractive thing to us would be to procure batteries in the Americas given right now that's 50 per cent of our business. However, with most batteries coming out of China, that’s tough – there’s still Covid lockdowns in China, so that delays things. The cost of logistics has shot up quite dramatically over the last 12 to 18 months. Also, the cost of raw materials – nickel and lithium – is causing the cost base of batteries to go up.

What do you see as the biggest obstacles to the wider adoption of storage?

RB: There's some issues with solar installations, challenges to tax credits for solar installations and that challenges the solar business cases. And then, while we actually haven't seen it yet in our pipeline, we are acknowledging the headwind that if the solar industry gets damaged because of policy or regulatory or tax issues that has a potential impact on what happens with energy storage, particularly in the US, I think that's an obstacle. The fact that there is no standalone storage ITC [investment tax credit] is also an obstacle. We have no batteries in the United States, and then we pay a punitive tax on bringing batteries in from China, so in the United States, that particular tax structure is difficult. 

What do you think will be the emerging trends in the storage sector? 

RB: In the next 24 months, I think we'll start to see some experimental battery chemistries or battery constructs. Today it's primarily LFP [lithium iron phosphate] and NMC [nickel, manganese and cobalt] batteries, but I think we’re going to see sodium and solid state – we'll see some of these starting to emerge, at least in a sort of prototype phase.

I also think we'll start to see more marriage of physical with digital. I think we'll see an increasing percentage of attachment rates where, when there's a physical battery storage system sold, there will also be a suite of digital applications that go with it that help customers optimise the use of those assets. 

As someone who featured in Energy Storage Report’s ‘Top 40 Women Leaders in Energy Storage’, what more do you think could be done to boost women’s participation in the industry?

RB: I do think companies need diversity, and need to face into diversity like Fluence has been doing, saying ‘look, we're going pay attention to this and we're going do something about it’. I think there needs to be a conscious effort to make sure that women are in hiring positions, and that there's a different eye looking out for how we're going to hire. And, by the way, we could substitute women in for any kind of diversity, like people from a different culture or people from a different identity, for example. We also need to make work flexible – people are still expecting people to be at their computer until 6:00 PM on the dot every day. Well, what if they have to drive their mom to chemotherapy at 5:15pm, and then they quit because they're like, well, I can't make this work? Is that really necessary? Let's make it work. In my experience that works out better. You get more out of people when it's more flexible.