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US-funded breakthrough battery tech just simply handed over to China

Licencing snafu sends American invention overseas

When US national laboratories develop a new technology, Uncle Sam is supposed to ensure it is commercialized in America. But that's not what happened with what's said to be a breakthrough battery design. 

A vanadium redox flow battery (VRFB) design created at Pacific Northwest National Laboratory (PNNL) has wound up in the hands of a Chinese company, which has since gone on to become the largest manufacturer of VRFBs in the world. The US, which owns the patent and invested $15 million of taxpayer dollars into its development, reportedly has no domestic production site for the novel VRFBs. 

That's not to say that VRFBs aren't manufactured in the US – some companies do make them – but the PNNL battery design is different. 

Over the course of six years, PNNL scientists developed a special mix of acid and electrolytes that they claim is twice as powerful as other vanadium-based batteries, doesn't degrade like other batteries, and can be infinitely discharged and recharged for as long as 30 years. The refrigerator-sized batteries could be installed in homes hooked up to solar panels and reduce demand on the power grid. 

From the lab, straight to the Middle Kingdom

Research on PNNL's VRFB began in 2006, and in 2012 the project's lead scientist, Gary Yang, applied for a license to manufacture and sell the design. The license was granted, leading to the formation of UniEnergy Technologies, which branded the battery ReFlex.

According to NPR, who spoke to Yang for an investigation, UniEnergy was unable to find any US investors. He said they were dissuaded due to the long potential lead times on returns. Yang turned to China, finding a ready investor in a company called Dalian Rongke Power Co, Ltd, located in Dalian, a city on a peninsula in the Yellow Sea between Beijing and South Korea. 

By 2017, Yang had granted Rongke a sublicense to manufacture the PNNL VRFBs in China despite his original license specifying that a certain number of batteries had to be sold in the US, which had to be "substantially manufactured" domestically as well, NPR said. 

In his interview with NPR, Yang acknowledged he didn't do that, selling few batteries in the US, all of which were made in China. The license was later transferred to a company based in the Netherlands called Vanadis Power that said it plans to manufacture the ReFlex batteries in China and later Germany, with potential future expansion into America. 

United States regulations make clear that the transfer of a US government license requires approval from Uncle Sam after officials verify manufacturing isn't moving overseas, and it's here that NPR alleges the Dept of Energy made its biggest mistake: after a couple of emails over the course of an hour and a half, a US government employee transferred the license from UniEnergy to Vanadis.

"Whether the manager or anyone else at the lab or Department of Energy thought to check during that hour and a half or thereafter whether Vanadis Power was an American company, or whether it intended to manufacture in the US, is unclear," NPR reported. 

Too little, too late?

The DoE declined to speak comment on the investigation, although a letter the news organization sent to the department with a timeline of events involving Rongke appears to have led to the license being terminated. 

"If DoE determines that a contractor who owns a DoE-funded patent or downstream licensee is in violation of its US manufacturing obligations, DoE will explore all legal remedies," the department told NPR. 

It's unclear if the DoE's withdrawal of Rongke's license will cause it to stop building the batteries, nor is the status of Vanadis' license clear. The Register has reached out to the government department for clarification.

At this stage, it appears withdrawing the license may have little effect: a blog post by German power company RWE in May said China is readying an 800 MWh lithium-free battery farm in Dalian that uses VRFBs, which is being built by Rongke and another Vanadis partner called Bolong New Materials. Vanadis' website describes Bolong as the exclusive producer of the mixed-acid electrolyte used in ReFlex batteries.

Vanadis continues to assert on its website that it holds exclusive rights to sell the ReFlex battery "in Europe, Africa, and the Middle East." Less clear is whether it has the rights to build and sell VRFBs in Asia, or if the US' withdrawal of a license allowing such will change anything. ®

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