International Battery stores away $35M for lithium-ion cells

International Battery, one of many companies racing to a cheaper, more efficient rechargeable lithium-ion battery, has brought in $35 million so far in a third round of venture funding that remains open.

Unlike many of its competitors, the company is geared toward grid-scale batteries that can be used by electric utilities to meet peak demand and make renewable sources of energy like wind and solar more reliable and easier to integrate. While Panasonic, Siemens and General Electric are working on this problem too, most of them are innovating batteries for automotive applications.

International Battery says it will use its new financing to expand its current manufacturing facility in Pennsylvania and to grow its sales and product development operations. Scaling manufacturing is one of the biggest challenges for venture-backed cleantech companies. Because it is capital intensive, with no immediate returns, more venture capital firms are shying away from follow-on rounds, preferring instead to provide smaller amounts to IT companies.

In addition to a longer-lasting storage system, International Battery is hoping to revolutionize the manufacturing process, using a unique, water-based approach that limits the amount of toxic chemicals used in the making of lithium-ion batteries.

Based in Allentown, Pa., International Battery is backed by Digital Power Capital, a private equity firm that invests only in electrical power technologies.