Cordless battery technologies are growing by leaps and bounds of late. From the first cordless weed trimmer powered by lithium-ion (Li-ion) batteries only a few years ago, now there are 42” cut, zero-turn riding mowers powered by 56-volt Li-ion batteries cranking out the equivalent of 22 horsepower. With consumer uptake reaching fever pitch, demand for batteries is soaring, which means so is the Li-ion battery shipping market, which has more complexities regarding regulations than one may realize. That’s where KULR Technology Group, Inc. (NYSE American: KULR) is making industry noise with its cutting-edge safety solutions.
Li-ion batteries are hazardous cargo that are notorious for overheating, smoking, and catching fire, events that certainly no one wants to happen in a truck, trailer, or airplane. Moreover, lithium battery fires produce toxic fumes and can be very difficult to extinguish. Yet, they happen quite frequently.
The Federal Aviation Administration shows 316 events, including 13 this year, on airplanes and at airports with smoke, fire, extreme heat, or explosion involving lithium batteries since January 23, 2006. Lithium-based batteries have been linked to two fatal cargo airplane crashes, shipping vessel fires and scores of shipping/delivery events, which inspired the National Transportation Safety Board to begin pushing for more stringent standards last year.
This is right in KULR’s wheelhouse. The San Diego-based company specializes in the development, manufacturing, and licensing of next-generation carbon fiber thermal management technologies for batteries and electronic systems. KULR developed its technology in collaboration with NASA, which has contracted KULR more than 30 times to use the technology on space missions where Li-ion battery fires could be catastrophic.
The company’s Thermal Runaway Shield (TRS), which wall off and protect individual battery cells, was tested late in 2020 by the Naval Surface Warfare Center, which further validated the integrity of the technology to prevent fires and explosions. The organization concluded that the KULR TRS "were found to be highly effective at resisting cell-to-cell propagation when a trigger cell was externally heated to failure. Meanwhile, identical cells with identical configuration but no TRS underwent a complete cell-to-cell propagation under the same test conditions."
Diversifying from the aerospace markets, KULR is unsurprisingly gaining attention in the commercial markets for its litany of potential applications. While being responsible for mission-critical parts in space looks great on a resume and speaks volumes to the quality of the tech and team, it is the global Li-ion battery market that will drive significant revenue. Industry research firm Markets And Markets estimates the global Li-ion battery market was worth $44.2 billion in 2020 and growing 16.4% annually to reach $94.4 billion in 2025.
All those batteries must get shipped to factories, warehouses, stores, and consumers. Plus, they must get shipped again for second life or end-of-life purposes. KULR plans to capture a chunk of this market and now has special permits that give it a greater opportunity to deepen its footprint in the shipping industry.
June was been a banner month on this front for KULR. The company received not one, but two, special permits from the U.S. Department of Transportation (DOT) authorizing the transport of lithium-ion and metal batteries.
The first permit relates to shipping for recycling Li-ion and metal batteries. The permit provides exceptions from shipping papers and employee training when shipping lithium batteries exceeds 300 Watt-Hours. The permit authorizes the exceptions based on using KULR's specially designed thermally protective packaging incorporating its patented TRS technology.
The second permit authorizes using KULR technology for the transport of prototype lithium cells and batteries aboard cargo aircrafts. Prototype lithium batteries are only authorized to be transported on cargo carrying aircrafts to, from or within the US when approved by DOT. The special permit authorizes the manufacture, mark, sale and use of KULR's specially designed packaging for the transportation of prototype lithium cells and batteries, and prototype lithium cells and batteries contained in or packed with equipment.
These new assets will pave the way for new logistical partners for air, maritime, and ground cargo transportation of lithium batteries. KULR was already making a name for itself in the shipping market after a deal with Americase last year. Americase owns the lion’s share of DDR (damaged, defective, or recalled) battery shipments and is a leader in providing lithium battery transportation and storage solutions for large format batteries to some of the world’s largest automotive companies.
Per the pact, Americase is using KULR’s passive propagation resistant (PPR) technology and sourcing the core materials from KULR to produce its patent pending Battery Bag to prevent lithium-ion battery thermal runaway propagation during storage and transportation.
Armed with the new permits, it would seem only a matter of time before investors hear about new developments on this front given the need for innovation to improve shipping safety.
