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(Bloomberg) — Eos Energy Enterprises Inc., whose stock has surged more than 720% over the past year, has signed an initial pact with a large-scale developer of data centers as soaring power usage boosts demand for batteries.
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The company is also working to close several other memorandums of understanding with data centers, Chief Executive Officer Joe Mastrangelo said. He declined to name the firms. He said agreements with data centers make up about 30% of potential deals for Eos, which manufactures zinc-based batteries that connect to the grid.
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“Data centers’ number one cost is the power” to run their facilities, and Eos’s energy storage systems help lower costs by smoothing out fluctuations in electricity demand, Mastrangelo said in an interview at Bloomberg News headquarters in New York. “It’s something we’re pretty excited about.”
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The data centers that run artificial intelligence require massive amounts of electricity, and their soaring power demand has contributed in part to the rise of battery systems that help support those needs. Battery companies XL Batteries Inc. and Natron Energy Inc. have signed deals with data-center developers.
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As President Donald Trump imposes tariffs on a wide range of products made outside the US, Eos has a potential competitive advantage in that it manufactures its systems near Pittsburgh and 91% of its supply chain is US-based. It’s planning to onshore the remaining 9%, an anode material currently sourced from South Korea, Mastrangelo said.
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About 69% of US imports of lithium-ion batteries — which are far more prevalent than the zinc-based ones Eos makes — are from China, according to BloombergNEF.
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Eos is currently working to expand its first production line and build a second line, funded in part by a $303.5 million loan from the US Energy Department. Mastrangelo said the company has drawn one $68 million tranche of the loan and “conversations are progressing as normal” with the rest of the disbursement, even as the Trump administration says it won’t move forward with billions of dollars worth of Biden-era loans.
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