NEC Energy Solutions Inc., one of the few energy storage companies with a global reach, is winding down operations after the COVID-19 pandemic thwarted plans to sell the business.
On Thursday, NEC management notified customers that it would begin an ¡°orderly wind down¡± of operations, with a majority of employees staying with the company long enough to complete its existing projects, according to a letter seen by Bloomberg. Although the Massachusetts-based company will not seek new business, it remains committed to finishing projects under development.
Japanese parent NEC Corp. tried to sell the business, according to the letter. But ¡°market conditions in the grid©\scale battery energy storage business and the impact of the coronavirus pandemic have inhibited the efforts to find a suitable buyer,¡± according to the letter.
NEC was one of a relatively small clutch of companies in the large-scale battery industry that had a global reach, and its exit raises the question of whether its struggles are unique to NEC or also applicable to its peers, said Logan Goldie-Scot, head of clean power research at BloombergNEF.
¡°It¡¯s fairly meaningful that they¡¯re wrapping up,¡± he said in an interview. ¡°If they¡¯re exiting the space because they don¡¯t view it as viable, then there¡¯s a whole series of questions.¡±
Chief Executive Officer Steve Fludder is resigning his post, to be replaced by Mark Lymbery, whom the company describes as a ¡°seasoned executive with expertise in business reorganizations.¡±
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