The Calix Ltd (ASX: CXL) share price is surging higher today following the announcement that it has partnered with a Swedish company to begin a pilot energy storage system.
During the first minutes of market open, the tech company's shares were up 14.6% to $2.35. At the time of writing, they have retreated to $2.21, up 7.8%.
Let's take a closer look at what Calix reported to the ASX market this morning.
What's driving the Calix share price higher?
The Calix share price is on the move today as investors digest the company's latest update.
In this morning's release, Calix advised it has entered into a partnership deal with SaltX Technology AB (SaltX).
Based in Sweden, SaltX builds and sells energy storage solutions. The group employs a specific technology that stores energy into salt crystals and converts them into heating or cooling. This can be used in solar-powered heating and cooling in buildings, electric buses and trucks, and even satellites.
Under the deal, SaltX will design and build a pilot 200kW electric-powered direct separation reactor (eDS) for Calix's energy storage system. This will be similar to a BATMn reactor installed at its Bacchus Marsh facility in Victoria in 2019.
In addition to the agreement, Calix will provide SaltX with a non-exclusive, non-transferable limited licence to use the eDS reactor. The energy storage system will be tested sometime around FY22.
Calix will also undertake its own research to develop the eDS unit, leading to further collaboration for a larger 1MW capacity project, provided both companies can achieve the desired results for the pilot reactor.
While the release did not detail the agreement's financial terms, the new partners believe that the joint teamwork will accelerate growth opportunity. They consider the development of efficient, low-cost energy storage systems to be a multi-billion market.
Management commentary
Calix managing director and CEO Phil Hodgson welcomed the new partnership, saying:
The use of Calix's technology in base load energy storage systems was foreshadowed as we developed our SOCRATCES project in Europe – which is based upon solar-powered calcium looping and is progressing well. We are very pleased to be working with SaltX on its system now also. This system has great potential for load balancing applications as the grid de-carbonises.
SaltX CEO Carl-Johan Liner added:
Calix is a pioneer in developing sustainable solutions for many industries and therefore I believe this co-operation will have many benefits in SaltX mission of developing energy storage solutions that will have a real change for the renewable energy sector.
The Calix share price is up more than 150% in the past 12-month period.
