A metro Atlanta test lab for cellphone batteries is moving into the electric vehicle space with a Boston expansion.
Energy Assurance LLC, which tests lithium-ion batteries for performance, compliance and safety requirements, bought a 20,000-square-foot lab, which has the necessary equipment and staff to start testing large batteries used for electric vehicles and energy storage systems.
The startup already has a 16,000-square-foot lab in Gainesville, Georgia, northeast of Atlanta, which focuses more specifically on small lithium-ion batteries, CEO Cindy Millsaps said.
Energy Assurance is an example of the many businesses that are starting or expanding because of the high-growth electric vehicle and renewable energy industry. Demand for lithium-ion batteries is expected to increase by 17-fold by 2030, according to a McKinsey & Co. June 2020 report. That growth is mostly driven by EV batteries, followed by energy storage then consumer electronics.
Georgia is already set to be on the forefront of the EV industry, experts say.
South Korea-based company SK Innovation is building two plants to produce batteries for electric vehicles in Jackson County, northeast of Atlanta. Production is slated to start early next year and could produce enough batteries for 200,000 vehicles and employ 1,000 workers by the end of 2021. Three other manufacturing facilities for EV components could also be on the way.
Growth in that industry means that Georgia startups have opportunities to innovate different pieces of the supply chain. For example, Atlanta not-for-profit Call2Recycle recycles lithium-ion batteries, which CEO Leo Raudys says is a huge section of the supply chain that needs industry attention. The city's expertise in logistics and supply chain is also an advantage.
Energy Assurance is another piece of the lithium-ion battery market. Those batteries need to be tested for safety reasons and for marketing purposes to let consumers know their performances, Millsaps said. Most of its customers aren’t local and ship batteries from California and other places, but that may change.
“Where we’re positioned in the Southeast with SK and LG as cell suppliers and the automotive industry in this area, it becomes a prime location to try and grow along with those manufacturers,” Millsaps said.
With the Boston lab acquisition, the startup will double in size and add seven employees that have the expertise to do the large-format, lithium-ion battery testing.
Millsaps started Energy Assurance after doing similar battery testing for phone company Motorola. By 2012, she had 5,000 square feet of testing space for Energy Assurance then moved to Gainesville for more space.
In May 2020, investment firm Renew Partners bought a majority stake in Energy Assurance, a move that Millsaps said aimed to help the startup’s business acumen as it geared up for expansion. Jon Peterson and Cres Ferrell of Renew Partners joined the lab’s executive team as managing partners.
Between 2019 and 2020, Energy Assurance doubled in revenue and is set for 40% growth in 2021, Millsaps said. Now, the startup is looking to expand into battery packs, systems and other components of the EV and energy storage battery as that industry skyrockets.
“This is only the beginning,” Millsaps said.
