Summary:

Despite Coda just going into production of its inaugural electric sedan, the startup will announce on Friday it’s launching a division that plans to sell its batteries and battery management system to act as energy storage for the power grid.

Coda sedan

Coda sedan

Despite Coda just going into production of its inaugural electric sedan, the startup will announce on Friday it’s launching a division that plans to sell its batteries and battery management systems to act as energy storage for the power grid. The idea has been in the works for years (former CEO Kevin Czinger told us about this plan in summer of 2010) and Ed Solar, the new SVP for the Coda Energy division, told me in an interview this week the energy storage division was officially developed about a year ago.

Coda’s battery technology is based around lithium iron phosphate batteries, and a good chunk of its intellectual property is around the cooling management system and software. The company has a joint venture with China battery maker Lishen, called Lio (oil spelled backward), and Lio owns the IP for the battery cell production, but Coda has retained the rights to the advanced thermal dynamics and battery management system.

Energy storage is a much-needed part of the power grid. The grid currently has to be in a constant state of equal supply and demand. But if energy storage tech — which includes batteries, thermal storage, compressed air, pumped hydro, and others — is added to the grid, it will help utilities manage balancing the load much more easily. And because clean power like wind and solar are unpredictable, the addition of more clean power will require more energy storage tech, too.

Coda sedan, under the hood

Batteries are among the most expensive forms of grid energy storage, but there are some benefits to batteries: They can be used in many more locations than compressed air and pumped hydro, and they are pretty fast to deploy compared to other technologies. Both U.S. power company AES   and Chinese utility State Grid are deploying huge battery projects for grid energy storage.

Coda’s Solar tells me Coda has a first customer for a trial of its grid batteries, but it doesn’t plan to disclose that customer until February. Solar says utilities, clean power producers and demand response players have shown interest in Coda’s grid batteries.

Solar also tells me the batteries and management systems Coda will sell for the power grid aren’t all that different from the ones it’s using in its cars. The main difference is that while the car batteries are flat, the grid batteries are organized in a tower, and 25 batteries grouped together creates 1 MWh worth of storage.

Coda is launching its new energy storage division in time with next week’s smart grid conference DistribuTECH, in San Antonio, Texas. We’ll see how many grid energy storage companies are at the event, as that industry has started to grow in recent months.

Other companies selling grid batteries include A123 Systems and Chinese battery maker BYD. Both A123 Systems and BYD also sell batteries for both electric cars and the grid, so clearly this is a common road for battery companies.

On Coda’s electric car front, the company isn’t actually selling its electric sedan just yet, and hopes to start doing so in February through its Coda store, through other dealers and through its website. Coda also closed $150 million in funding just a few months ago to get all of these efforts off the ground.

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