Brenmiller Energy Reports Third Quarter Operational Update and Financial Results

ROSH HAAYIN, Israel–(BUSINESS WIRE)–Brenmiller Energy Ltd. (“Brenmiller”, “Brenmiller Energy” or the “Company”) (TASE: BNRG, Nasdaq: BNRG), a clean-energy company that provides Thermal Energy Storage (“TES”) systems to the global industrial and utility markets, today announced financial results as of and for the nine and three months ended September 30, 2022, in addition to operational updates.

Company Highlights

• Inaugurated our first utility-scale project with Enel in Italy; operating successfully to date
• Signed a memorandum of understanding with Green Enesys and Viridi RE to explore the integration of the Company’s bGen™ in potential Green Hydrogen and Green Methanol projects
• Completed the first draw down for €4 million, on July 28, 2022, under our credit facility with the European Investment Bank (“EIB”), to support accelerated investment in our production facility in Dimona, Israel.
• Completion and commissioning of pilot projects is laying a foundation for increased commercial orders in 2023 and beyond
• Placed USD $2.0 million in equipment orders to facilitate the expansion of the Dimona, Israel facility; on track to reach full production in 2023

Management Commentary

“Throughout 2022 Brenmiller has shown great progress towards its efforts to become one of the global leaders in thermal energy storage solutions for industrial and utility markets,” said Avi Brenmiller, Chairman and Chief Executive Officer of Brenmiller Energy. “We have completed installations and begun operations at multiple pilot projects around the world, establishing the Company as a formidable global player. I’m particularly excited about the inauguration of our first utility- scale project in Italy earlier this month, which marks the realization of several years of hard work and dedication by the entire Brenmiller team and our partners from the Enel Group and Enel Green Power. The project is a major milestone in our company’s history; we believe it will help showcase the benefits our technology has on reducing emissions and improving operating costs at a large-scale facility and give other global power producers the confidence they need to invest in our technology.”

“Looking forward, we continue to see strong demand for our thermal energy storage solution. Our bid pipeline is large and continuously growing, with Europe representing our best near-term opportunity for deployments as industrial organizations and utilities look to invest in sustainable solutions as a direct reaction to high energy prices and an increased need for energy security,” continued Brenmiller. “While we believe the demand outlook remains robust, we are being prudent with our cost structure in the near-term and are taking steps to ensure we remain in a healthy financial position as Brenmiller Energy continues to grow.”

New Project Awards

To date in 2022, Brenmiller has received commercial orders of USD $9 million, and as previously announced, is negotiating a energy-as-a-service] contract in Israel for approximately USD $5 million, driven by growing demand for thermal energy storage systems from industrial customers. The Company is marketing its bGen TES system globally, through direct equipment sales and through an energy-as-a-service (“EaaS”) model. Brenmiller has developed a large pipeline of opportunities for which it expects to pursue commercial agreements in 2023 and beyond. In the near-to-intermediate term, the majority of Brenmiller’s bid opportunities are in Europe, where high energy prices and concerns over energy security are driving incremental demand for non-traditional energy sources.

In September 2022, Brenmiller signed a Memorandum of Understanding (“MoU”) with Green Enesys Deutschland GmbH (“Green Enesys”) and Viridi Energias Renovables Espana, S.L. (“Viridi RE”), two European based developers of green energy projects, to perform engineering studies for incorporating bGen TES for Green Enesys’ and Viridi REs’ proposed green hydrogen production facilities throughout Spain. Green Enesys and Viridi RE are currently developing three green hydrogen projects in Spain, with the goal of decarbonizing the European Union’s industrial, power generation and transportation sectors. The projects will have a combined capacity to produce over 100,000 tonnes of green methanol annually.

Project Updates and Summary of Current Operations

Brenmiller has made material progress installing various pilot projects in diverse regions worldwide in an effort to demonstrate the use of its technologies for both industrial and utility-scale applications. The Company expects investments made into these pilot projects will accelerate commercialization of its proprietary TES technology. The pilot projects have progressed as planned and are continuing to reach major milestones.

• Philip Morris: In March 2022, the Company signed an agreement, for up to USD $9 million, with Philip Morris Romania for the purchase of a bGen TES and services. The system will have a capacity of 31.5 MWh, including a biomass system and auxiliary equipment; the agreement includes an option to expand the system to 52.5 MWh. Payments will be made based on defined milestones in the agreement. Basic engineering of the system is complete and is moving to the detailed design phase. The next major milestone is receiving a building permit, which is expected in the first quarter of 2023.
• Enel: Brenmiller designed, manufactured, and installed a 24 MWh TES system for a combined cycle power plant for Enel in Italy. This is the Company’s first utility-scale project. Enel integrated the system at the power plant and validated its performance in the field, in challenging operating conditions, and on a large scale. The Company’s bGen unit for Enel is currently in the commissioning phase and is expected to be fully operational by year-end 2022. The system offers reduced power plant start-up times and greater speed in load variations and can store excess heat, in addition to energy produced from renewable sources in the form of heat, to offer decarbonization services to Enel’s industrial utility customers. Enel has the option to add additional storage capacity at the site.
• SUNY Purchase: Brenmiller completed the installation of a 0.5 MWh thermal storage-based co-generation station with the New York Power Authority (NYPA) at SUNY Purchase College in New York. The system includes hybrid charging with both exhaust gas and electricity. The project is currently in the commissioning phase with final delivery expected in the first quarter of 2023.
• Fortlev: Brenmiller designed, manufactured, and installed a 1 MWh TES with Fortlev in Brazil. The TES system, which is being charged with biomass, is now completed and is in operation as of August 2022. The system uses biomass instead of natural gas, allowing Fortlev to lower greenhouse gas (GHG) emissions associated with heating this air by approximately 800 metric tons annually. It also reduces costs by more than 75%.

Dimona Israel Production Facility

On March 31, 2021, Brenmiller signed a €7.5 million credit facility with the EIB for the creation of an advanced production facility in Dimona, Israel. The Company made its first draw down on the first of two tranches of the credit facility for €4.0 million on July 28, 2022.

The production facility is currently under construction and will have the capacity to produce up to 4,000 MWh per year of bGen thermal storage modules. To date, the Company has ordered equipment totaling USD $2.0 million in connection with the expansion at this facility. The equipment has been delivered and the facility is expected to reach full production capacity by the end of 2023. This facility will be critical to Brenmiller’s ability to meet growing customer demand.

Research and Development

Research, development, and engineering expenses, net of government grants, were USD $3.47 million in the nine months ended September 30, 2022, compared to USD $2.71 million in the nine months ended September 30, 2021. The increase is primarily attributable to higher payroll costs as the Company has made additional hires to enhance its research and development team to support future growth.

Research, development, and engineering expenses, net breakdown:

	Nine months ended September 30
	2022		2021
	USD in thousands (unaudited)
Total research, development, and…