Q1 2022 Heliogen Inc Earnings Call
Speaker 1: Good morning, and welcome to the Heliogen first quarter 2022 conference call. As a reminder, today's call is being recorded. At this time, all participants are in listen-only mode.
Good morning, and welcome to the huge in first quarter 2022 conference call.
As a reminder, today's call is being recorded.
At this time all participants are in a listen only mode.
A question and answer session will follow the prepared remarks.
Speaker 1: I would now like to turn the call over to Lewis Baltimore, Hail Agent's Vice President of Investor Relations, for opening remarks and introductions.
I would now like to turn the call over to Louis Baltimore allegiance, Vice President of Investor Relations for opening remarks and introductions.
Speaker 2: Thank you, operator, and good morning to everyone. We're glad you could join us today for our first quarter 2022 conference.
Thank you operator, and good morning to everyone. We're glad you could join US today for our first quarter 2022 conference call.
Speaker 2: With us on today's call are Bill Gross, Heliogen's founder and chief executive officer, and Kristi Obia, our chief financial officer.
With us on today's call are Bill gross <unk>, founder and Chief Executive Officer, and Christi, Obi I have our chief financial Officer.
Speaker 2: Heliogen issued its results this morning in a press release that can be found on the investors section of our website at Heliogen.com
Helio Gen issued its results. This morning in a press release that can be found on the investors section of our website at Helio Gen Dotcom.
Speaker 2: As a reminder, our comments on this call include forward-looking statements which are subject to various risks and uncertainties. These statements include expectations and assumptions regarding potential award grants, the company's future operations, and financial performance including our guidance for full year 2020.
As a reminder, our comments on this call include forward looking statements, which are subject to various risks and uncertainties. These statements include expectations and assumptions regarding potential award grants, the company's future operations and financial performance, including our guidance for full year 2022.
Speaker 2: actual results could differ materially from those contemplated in the forward-looking statement.
Actual results could differ materially from those contemplated in the forward looking statements.
Speaker 2: Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events.
Any forward looking statements that we make on this call are based on assumptions as of today and we undertake no obligation to update these statements as a result of new information or future events factors.
Speaker 2: Factors that could cause actual results to differ materially can be found in this morning's press release and other documents filed with the SEC by the company from time to time, including our amended annual report on Form 10-K -A.
Factors that could cause actual results to differ materially can be found in this morning's press release and other documents filed with the SEC by the company from time to time, including our amended annual report on Form 10-K a.
Speaker 2: During this call, we may also refer to certain non-GAAP financial measures, including EBITDA and adjusting the
During this call. We may also refer to certain non-GAAP financial measures, including EBITDA and adjusted EBITDA. These.
Speaker 2: These non-GAAP financial measures should be considered in addition to, and not as a substitute for, or in isolation from GAAP results.
These non-GAAP financial measures should be considered in addition to and not as a substitute for or in isolation from GAAP results.
Speaker 2: more detailed information about these measures and the reconciliation of the most comparable US GAAP measure.
More detailed information about these measures and a reconciliation to the most comparable U S GAAP measures.
Speaker 2: is contained in the press release issued this morning, which is available in the investor's section of our website and was furnished on form 8K with the SEC. A replay of this call will also be available on the investor's section of our company website this afternoon. And with that, I'm pleased to turn the call over to Bill Grouse, our founder and chief executive officer. Thank you, Louis.
As contained in the press release issued this morning, which is available on the investors section of our web site and was furnished on form 8-K with the SEC a replay of this call will also be available on the investors section of our company website. This afternoon.
With that I'm pleased to turn the call over to Bill gross our founder and Chief Executive Officer.
Thank you Louis and thanks to everyone for joining us this morning on the call.
Speaker 3: I'm incredibly excited to speak to you today on our second conference call as a public
I'm excited to speak to you today on our second conference call as a public company.
Speaker 3: First, I'll provide an update on our progress as relates to the key milestones we laid out for you with our last
First I'll provide an update on our progress as it relates to the key milestones we laid out for you with our last report.
Speaker 3: Then I'll turn it over to Christy to walk you through our key financial aspects of the first.
And then I'll turn it over to Christie to walk you through our key financial aspects of the first quarter.
Speaker 3: Our mission is to build an enduringly profitable, scalable business that contributes to achieving the net zero ambition by decarbonizing heavy.
Our mission is to build an enduring profitable scalable business that contributes to achieving net zero ambition by Decarbonising heavy industry.
Speaker 3: We chose to focus on heavy industry because it's the largest energy-consuming sector in the world and is currently wildly underserved by renewable energy.
We chose to focus on heavy industry I guess, it's the largest energy consuming sector in the world and is currently wildly underserved by renewable energy our systems would replace industrial burning of fossil fuel with concentrated sunlight or especially needed right now.
Speaker 3: Our systems, which replace industrial burning of fossil fuel with concentrated sunlight, are especially needed right now, and we have developed proprietary technology that meets the energy needs of heavy industry.
We have developed proprietary technology that meets the energy needs of heavy industry.
Speaker 3: Our technology concentrates sunlight to extremely high temperatures
Our technology concentrates sunlight to extremely high temperatures.
Speaker 3: using an AI-based control system that turns a field of small mirrors into effect, a self-adjusting, huge magnifying glass at scale.
Using an AI based control system. It turns a field of small mirrors into effect.
Adjusting huge magnifying glass at scale.
We use that to create a 100% carbon free solar thermal energy of temperatures up to 1000 degrees Celsius.
Speaker 3: can be used to make steam, electric power, or green hydrogen.
It can be used to make steam electric power or green hydrogen we.
We call. These three end products Helio heat power.
Power and he'll he'll fuel.
Speaker 3: If you're new to Heliagen's story or would like a refresher, I'll refer you to our full year 2021 conference call from March 29th, during which we provided a more detailed overview of our business.
If you're new to heal agent story.
Like a refresher I'll refer you to our full year 2021 conference call on March 29.
During which we provided a more detailed overview of our business.
Before we get into our progress on individual milestones I am pleased to say that we remain on track with the plan for this year and we laid out in our last earnings call.
Speaker 3: I am pleased to say that we remain on track with the plan for this year that we let out in our last earnings call.
Speaker 3: Given the rapid pace of growth and goals we set out to achieve, I am proud of what our team has done so far.
Given the rapid pace of growth and goals, we set out to achieve I am proud of what our team has done so far.
Speaker 3: We continue to execute against our goals, despite the ongoing supply chain disruptions.
We continue to execute against our goals despite the ongoing supply chain disruptions.
Speaker 3: Fortunately, our product is unique among renewable energy technologies in using software to derive value from widely available commodities.
Fortunately our product is unique among renewable energy technologies and using software to derive value from widely available commodities, such as steel glass and aluminum <unk>.
Speaker 3: as steel, glass, and aluminum, instead of relying on expensive and limited materials such as cobalt and lithium.
Instead of relying on expensive unlimited materials, such as cobalt and lithium geopolitical situation that has caused fossil fuel prices to double in the past year provides a strong tailwind for our customer discussions because we are intent on matching or beating our customers avoided cost of fossil fuels and delivering our products to them with Zia.
Speaker 3: Because we are intent on matching or beating our customers' avoided cost of fossil fuels and delivering our products to them with zero carbon emissions.
Row carbon emissions.
Speaker 3: The geopolitical situation has made both of those objectives more urgent for our current and potential customers.
The geopolitical situation has made both of those objectives more urgent for our current and potential customers.
Speaker 3: You may have seen the headlines about a recent Department of Commerce investigation to determine whether PV solar panels are being assembled with Chinese components in Southeast Asia to get around the PV tariff.
You may have seen the headlines about a recent department of Commerce investigation determined whether PV solar panels are being assembled with Chinese components in southeast Asia to get around the P. B tariffs.
Speaker 3: Because we are solar thermal and not solar PV, we are not impacted by any future changes to Chinese tariffs on PV or recent lawsuits that have put hundreds of PV projects on hold.
Because we are a solar thermal and not solar PV, we are not impacted by any future changes to Chinese tariffs on television or recent lawsuits that I put hundreds of PV projects on hold.
Another final note on market tailwind.
Speaker 3: Because of the world's massive shift towards electric vehicles, lithium has become many times more valuable, and mining companies around the world are scaling up their operations to deliver much more.
Because of the world's massive shift towards electric vehicles lithium has become many times more valuable and mining companies around the world are scaling up their operations to deliver much more.
Speaker 3: Thermal energy is a critical component to these mining operations.
Thermal energy is a critical component to these mining operations.
Speaker 3: Almost all of these mines are in remote off-grid locations.
All of these mines are in remote off grid locations.
Speaker 3: places where it is often complicated or expensive to add transmission lines or pipelines.
Places, where it is often complicated or expensive to add transmission lines our pipelines.
Speaker 3: Heliogen is uniquely positioned to provide thermal energy in remote locations, making the mining sector a particularly attractive opportunity for our solution.
Hilli adjourn is uniquely positioned to provide thermal energy and remote locations, making the mining sector, a particularly attractive opportunity for our solutions.
Speaker 3: If you turn to page six of the presentation posted on our website, you'll see we've laid out our 2022 commercial and execution milestones in chronological order.
If you turn to page six of the presentation posted on our website, you'll see we've laid out our 2022 commercial and execution milestones in chronological order.
Speaker 3: It's been only eight weeks since our last conference call, yet we have made meaningful progress in that short time, and we are on track to achieve several more important milestones during the second half of this year.
It's been only eight weeks since our last conference call. We have made meaningful progress in that short time.
We are on track to achieve several more important milestones during the second half of this year.
Speaker 3: As we announced on March 28th, we have finalized the contract for our first commercial module with Woodside.
As we announced on March 28, we have finalized the contract for our first commercial module with Woodside.
Speaker 3: This project supports the design and build of commercial-scale 5-megawatt electric demonstration facilities and also includes the scope of funding of our previously announced $39 million award from the U.S. Department of Energy.
This project supports the design and build a commercial scale five megawatt electric demonstration facility and also includes the scope of funding of our previously announced $39 million award from the U S Department of energy.
Speaker 3: For this project, we will build, deploy, and test a supercritical carbon dioxide, supercritical CO2, SCO2 power generation system coupled with our AI
For this project, we will build deploy and test a supercritical carbon dioxide supercritical C. O. Two S. C O two power generation system, coupled with our AI enabled heliostat deal.
Speaker 3: While our concentrated solar energy system can also be paired with existing steam turbine technology to convert thermal energy to power, supercritical CO2 has the potential to deliver higher efficiency, lower cost power generation, with a smaller footprint, and with reduced water use.
Well, our concentrated solar energy system can also be paired with existing steam turbine technology to convert thermal energy to power.
Supercritical C O two has the potential to deliver higher efficiency lower cost power generation with a smaller footprint that was reduced water use.
Speaker 3: Our focus on the new approach, which uses supercritical CO2 technology, is one of many examples of where Heliogen continues to innovate to bring more value to all stakeholders and stay ahead of the competition.
Our focus on the new approach, which uses supercritical C. O. Two technology is one of many examples of where he lead Gen continues to innovate to bring more value to all stakeholders and stay ahead of the competition.
Speaker 3: Along with the Woodside project agreement, we also entered into a collaboration agreement with Woodside to jointly market and identify opportunities for deploying Heliogens technology throughout Australia.
Along with the Woodside project agreement, we also entered into a collaboration agreement with Woodside to jointly market and identify opportunities for deploying helio gents technology throughout Australia.
Speaker 3: Woodside brings both familiarity with and access to industrial owner-operators in Australia that could really benefit from Heliogen's technology.
Woodside brings both familiarity with and access to industrial owner operators in Australia that could really benefit from helium <unk> technology.
Speaker 3: Australia's resource base, climate, and geography makes it one of the best places on the planet to deploy our technology. We are very enthusiastic about this partnership to help Woodside achieve its energy transition targets, while also helping us to expand our business to one of the largest global markets for our technology.
Australia's resource base climate and geography. It makes it one of the best places on the planet to deploy our technology.
We are very enthusiastic about this partnership to help Woodside achieve its energy transition targets, while also helping us to expand our business. It's one of the largest global markets for our technology.
Speaker 3: We also continue to make progress with the permitting and approvals process for the Woodside project.
We also continue to make progress with the permitting and approvals process for the Woodside project.
Speaker 3: We have filed our conditional use permit application along with the necessary technical studies with Kern County, California, and the county has deemed that.
We have filed our conditional use permit application along with the necessary technical studies with Kern County, California, and the county has deemed that complete.
Speaker 3: In parallel with the permitting process, the detailed engineering work is well underway, and we are engaging with our supply chain partners.
In parallel with the permitting process. The detailed engineering work is well underway and we are engaging with our supply chain partners. We expect to begin construction once the permitting process is complete.
Another one of our key execution milestones is the selection and announcement of our major supply chain partners, and we're making great progress on that front too.
Speaker 3: For example, we recently announced that we partnered with Hanwha Powers.
For example, we recently announced that we partnered with Han what power systems, a global leader in the development of eco friendly power generation solutions.
Speaker 3: global leader in the development of eco-friendly power generation.
Speaker 3: As part of this partnership, we jointly developed a modular, high-efficiency, five-megawatt electric supercritical CO2 power block integrated with high-temperature solid media thermal energy storage for deployment as part of the DOE award. And Hanwha will manufacture it.
As part of this partnership we jointly developed a modular high efficiency five megawatt electric supercritical C. O two power block integrated with high temperature solid media thermal energy storage for deployment as part of the deal He award.
And hardware will manufacture it.
Speaker 3: We see this partnership as an endorsement from Hanwha of our technical capabilities and the long-term potential of supercritical CO2 as an evolution in electric power generation.
We see this partnership as an endorsement from hard work of our technical capabilities and the <unk>.
Long term potential of supercritical C O two as an evolution in electric power generation.
Speaker 3: It's also one example of the way we leverage the scale and expertise of third party manufacturers to help reduce our own capital expenditures.
It's also one example of the way we leveraged the scale and expertise of third party manufacturers to help reduce our own capital expenditure needs.
Speaker 3: The supercritical CO2 power block is designed to meet the renewable power generation requirements for industrial customers in energy, mining, and other heavy industries.
The supercritical seal to power block is designed to meet the renewable power generation requirements for industrial customers in energy mining and other heavy industries and we see a huge potential for this technology to enhance our helio power product offering.
Speaker 3: And we see a huge potential for this technology to enhance our heliopower product offering.
On the manufacturing front in February we announced initial site preparation for our heliostat production facility in long Beach, California, and we are progressing there as plant.
Speaker 3: February we announced initial site preparation for our heliostat production facility in Long Beach, California and we are progressing there as planned. Our rapid prototyping capabilities are fully operational. We now have operational automated mirror and actuator pilot lines that we're using to develop and tune critical processes and equipment.
Our rapid prototyping capabilities are fully operational now have operational automated mirror and actuator pilot lines. They were using to develop in June critical processes and equipment.
Speaker 3: We expect one final piece of equipment to be installed later this month to complete our reliability and test lab, which is being used for product validation and life cycle testing.
We expect one final piece of equipment to be installed later this month to complete our reliability and test lab, which is being used for product validation and lifecycle testing.
Speaker 3: We are preparing for the installation of the main production lines, which will give us the capability to significantly boost Pileostat production capability while reducing our production costs. We remain on track for this portion to be fully operational later this year, completing the Long Beach facility.
We are preparing for the installation of the main production lines, which will give us the capability to significantly boost at least that production capability, while reducing our production costs. We remain on track for this portion to be fully operational later this year completing the long beach facility.
Speaker 3: Once we get these main production lines up and running, we'll be sure to share some great video and photo content with you via our website and social media channels.
Once we get these main production lines up and running we will be sure to share some great video and photo content with you via our website and social media channels.
Speaker 3: The important part to note about this automated robotic large-scale concentrated solar manufacturing facility is that we believe to be the first of its kind in the world dedicated to efficient mass manufacturing of the heliostats used in concentrated solar energy production.
The important part to note about this automated robotic large scale concentrated solar manufacturing facility is that we believe to be the first of its kind in the world.
Dedicated to efficient mass manufacturing of the Helios, that's used in concentrated solar energy production.
This is an important difference.
Speaker 3: Old generation heliostats are too large for automated manufacturing and have to be constructed with manual labor in the field, whereas Heliogen's heliostats are small enough for repeatable automated manufacturing processes which take place entirely in our facility, where quality control and cost efficiencies can be achieved.
Old generation helium stats are too large for automated manufacturing and have to be constructed with manual labor in the field.
Whereas helio Jens heliostat are small enough for repeatable automated manufacturing processes.
Place entirely in our facility.
Quality control and cost efficiencies can be achieved.
Speaker 3: Use of these small heliostats are made possible because of our innovative software control.
Use of these small hilli stats are made possible because of our innovative software control system.
Speaker 3: In February , we also announced the award of an exclusive lease agreement with the U.S. Bureau of Land Management for the Brenda Solar Energy Zone in Arizona.
In February we also announced the award of an X.
Lucid lease agreement with the U S Bureau of land management for the Brenda Solar energy zone in Arizona.
Speaker 3: We plan to develop a facility to produce up to 20,000 metric tons of green hydrogen per year.
We plan to develop a facility to produce up to 20000 metric tons of green hydrogen per year.
Speaker 3: This site is an ideal location for commercial scale green hydrogen production due to its ample local water supply and its proximity to key distribution channels.
This site is an ideal location for commercial scale green hydrogen production due to its ample local water supply and its proximity to key distribution channels.
Speaker 3: Since our last earnings call, we fully executed the lease with the Bureau of Land Management and are now working on our plan of development, which we anticipate submitting to the BLM before starting the National Environmental Policy Act permitting process.
Since our last earnings call, we fully executed the lease with the Bureau of land management and are now working on our plan of development, which we anticipate submitting to the BLM before starting the National Environmental Policy Act permitting process.
Speaker 3: Our ultimate goal is to leverage the attractive aspects of this site.
Our ultimate goal is to leverage the attractive aspects of this site.
Speaker 3: and our in-house project development expertise in order to partner with a hydrogen producer that wants to own and operate a heliogen-developed heliofuel hydrogen production facility.
And our in House project development expertise in order to partner with a hydrogen producer that wants to own and operate a hilli agenda developed illegal fuel hydrogen production facility.
Speaker 3: The U.S. federal government and many other governments around the world recognize the importance of mitigating the effects of climate change and have allocated large sums of money for grants, low-interest loan guarantees, and other monetary partnerships.
The U S federal government and many other governments around the world recognize the importance of mitigating the effects of climate change and have allocated large sums of money for grants low interest loan guarantees and other monetary partnerships for.
Speaker 3: The $39 million DOE award, which I mentioned earlier, is just the first of several we aim to receive over the next few years to help fund and accelerate the advancement of our game changing industrial decarbonization technology.
The 39 million dollar deal, We award, which I mentioned earlier is just the first of several we aimed to receive over the next few years to help fund and accelerate the advancement of our game changing industrial de Carbonization technology.
Speaker 3: The DOE is also attempting to place over $40 billion in funding grants, loans, and loan guarantees that Heliogen's concentrated solar energy technology qualifies.
The D. O E is also attempting to place over $40 billion and funding grants loans and loan guarantees that helium <unk> concentrated solar energy technology qualifies for.
Speaker 3: There are also additional government funding opportunities at state and local levels here in the United States, in addition to international grant programs overseas that we also qualify.
There are also additional government funding opportunities at state and local levels here in the United States. In addition to international Grant programs overseas, but we also qualify for it.
Speaker 3: We have an experienced team working on this public sector funding effort led by Tom Doyle, our chief commercial officer.
We have an experienced team working on this public sector funding effort led by Tom Doyle, our Chief commercial officer.
Speaker 3: Tom has extensive experience in successfully navigating his grant and guarantee program.
Tom has extensive experience in successfully navigating these grant and guarantee programs.
Speaker 3: Over a two-year period at BrightSource, Tom secured $1.75 billion in low-interest DOE loan guarantees.
Over a two year period Brightsource, Tom secured 1.75 billion in low interest.
Speaker 3: and managed additional DOE-guaranteed loans for a total of over $5 billion.
Loan guarantees and managed additional D O E guaranteed loans for a total of over $5 billion.
Speaker 3: This is just a part of the valuable experience and skillset Tom brings to Heliogen, gained over his 25 years developing utility-scale energy projects globally.
This is just a part of the valuable experience and skill set Tom brings to Hilli adjourn gained over his 25 years developing utility scale energy projects globally.
Speaker 3: We have already applied for several additional awards and we look forward to sharing more about these efforts as we secure additional funding and make progress on these efforts.
We have already applied for several additional awards and we look forward to sharing more about these efforts as we secure additional funding.
Progress on these efforts.
Speaker 3: Now I'd like to turn over the call to Christy Obiaia, our CFO .
Now I'd like to turn over the call to Christy Obi I have our CFO .
Thank you Bill and thanks to everyone for joining us.
Speaker 4: Let's first talk about our progress as it relates to our primary guidance metric of two to three modules contracted in 2022. We remain
First talk about our progress as it relates to our primary guidance metric of two to three modules contracted in 2022.
We remain on track with this guidance.
Speaker 4: As Bill mentioned, at the end of March, we executed with our customer, Woodside, our first full contract for our commercial scale module. We also continue to progress.
Bill mentioned at the end of March we executed with our customer Woodside, our first full contracts for commercial scale module.
We also continue to progress additional module contracts.
Speaker 4: This includes the HelioHeap module that we've been selected to deploy for Rio Tinto, the global metals and mining company at their mine in Boron, California.
This includes the Helio heap module that we have been selected to deploy for Rio Tinto and global metals and mining company at their mining more on California.
Speaker 4: We've been working to finalize the design and to structure the full contract for that facility.
We've been working to finalize the design infrastructure the full contract.
Speaker 4: We continue to make good progress on this effort, and we expect to have that contract finalized in the coming
We continue to make good progress on this effort and we expect to have that contract finalized in the coming months. We expect these two contracts to get us to the low end of our guidance range.
Speaker 4: We expect these two contracts to get us to the low end of our guidance range.
Speaker 4: We're in additional discussions with some new and very interesting potential customers that indicate wide application for our helio heat technology for industrial heat applications ranging from steel manufacturing in Africa to solar desalination in California to high value mineral mines in various locations worldwide.
We're in additional discussions with some new and very interesting potential customers that indicate why it application where he technology for industrial heat applications ranging from steel manufacturing in Africa, just solar desalination in California to high value mineral minds in various locations worldwide.
Speaker 4: Closing any one of these deals, in addition to the two I just mentioned, would get us to the high end of our guidance range, and we have more in our pipeline.
Posing any one of these deals in addition to the two I just mentioned would get us to the high end of our guidance range and we have more in our pipeline.
Speaker 4: The model that we contract this year will serve as the foundation for our revenues over the next few years.
The models that we contract this year will serve as the foundation for our revenues over the next few years.
Speaker 4: Now let me cover our financial results, starting with the restated full year 2021 financials that we published today, along with the Q1.
Now, let me cover our financial results starting with the restated full year 2021 financials that we published today along with the Q1 results.
Speaker 4: From a high level, the 2021 restatement has no impact on Heliogen's operations, business prospects, or liquidity.
From a high level the 2021 REIT statement has no impact on <unk> operations business prospects or liquidity.
Speaker 4: You may recall we are currently performing against a DOE award contract, which we entered into during the fourth quarter of 2020.
You May recall, we are currently performing against a D O word contracts, which we entered into during the fourth quarter of 2021.
Speaker 4: That award is related to one of our first commercial scale projects for our heliopower offering with our customer Woodside.
That award is related to one of our first commercial scale projects for Helio power offering with our consumer Woodside.
Speaker 4: as part of our first quarter 2022 financial statement preparation process.
As part of our first quarter 2022 financial statement preparation process, we determined that the deal We award should be recorded under a grant accounting model.
Speaker 4: We determined that the DOE award should be recorded under a grant account.
Speaker 4: So we've restated our 2021 financials to reflect this change in account.
So we've restated our 2021 financials to reflect this change in accounting.
Speaker 4: We continue to report the funds receivable under the DOE award as revenue that we earn as we incur costs related to the project. The net result of this accounting change was no change to revenue reported for 2021.
We continue to report the fund's receivable under the deal We award as revenue that we earn as we incur costs related to the project.
The net result of this accounting change with no change to revenue reported for 2021.
Speaker 4: and the reversal of a contract loss previously attributed to the DOE award that is no longer required under grant.
And the reversal of a contract loss previously attributed to the D. O V Award that is no longer required underground accounting.
Speaker 4: which reduces our 2021 growth loss by about 4%.
Which reduces our 2021 gross loss by about $4 million.
Speaker 4: This loss was instead recognized in Q1 2022 following the execution of our recent Woodside contract.
This loss was instead recognized in Q1 2022 following the execution of our recent Woodside contract Sims.
Simply put.
Speaker 4: The restatement is a timing difference and lost recognition for our first contract.
The restatement is a timing difference in loss recognition for our first contracts.
Speaker 4: By April 1st, 2022, we have the same balance sheet outcome, regardless of which accounting category.
By April 1st 2022 we have the same balance sheet outcome, regardless of which accounting treatment was used.
Speaker 4: This revised accounting has no impact on the company's liquidity, operations, business prospects, or on the overall economics of the project. Moving on to our results.
This revised accounting has no impact on the company's liquidity operation business prospects or on the overall economics of the projects.
Moving onto our results from the first quarter of 2022.
Speaker 4: In Q1, Heliogen reported $3.5 million in revenue on a
In Q1, he Neogen reported $3 5 million in revenue.
Contracts in progress.
Speaker 4: We fully expected our revenue this year to be back halfway, given the fact that we signed the Woodside project contract at the end of March, and so in fact the revenue that we recognize during the first quarter puts us on track toward our 20 to $25 million revenue guidance for the full year of 2020.
Fully expected our revenue this year it should be back half weighted given the facts that we signs of Woodside project contract at the end of March and so in fact, the revenue that we recognized during the first quarter puts us on track toward our $20 million to $25 million revenue guidance for the full year of 2022.
Speaker 4: with the funding from Woodside combined with the application of the DOE award.
With the funding from Woodside combined with the application of the deal We award.
Speaker 4: We have contracts in place for our first module to provide $89 million in gross contractual value, which will translate to approximately $85 million of net revenue that we expect to recognize over a multiyear period.
We have contracts in place for our first module to provide $89 million and Roche contractual value, which will translate to approximately $85 million of net revenue, we expect to recognize over a multiyear period.
Speaker 4: That difference between contract value and net revenue that we expect to recognize is due to a difference in what is recognizable under GAAP guidance related to the Woodside contract. And we've laid this out on page seven in our earnings presentation.
That difference between contract value and net revenue that we expect to recognize is due to a difference in what is recognizable under GAAP guidance related to the Woodside contract and we've laid this out on page seven in our earnings presentation.
Speaker 4: During Q1, we also recognized a non-cash contract loss provision of $33 million associated with our execution of the Woodside Project Agreement from late March. You can see this provision for
During Q1, we also recognized a noncash contracts loss provision of $33 million associated with the execution of the Woodside project agreement from late March.
You can see this provision for contract losses in our income statements.
Speaker 4: That amount is for all aspects of the project, so it is net of a $2 million growth loss already recorded in Q4 2015.
That amount is for all aspects of the project. So it is net of a $2 million gross loss already recorded in Q4 2021 and it includes the $4 million contract loss that was reversed from 2021 as mentioned earlier.
Speaker 4: And it includes the $4 million contract loss that was reversed from 2021, as mentioned earlier.
Speaker 4: In total, and considering amounts previously recognized in Q4 2021, we are currently estimating an approximate $35 million loss on our first module.
In total and considering amounts previously recognized in Q4 'twenty 'twenty. One we are currently estimating an approximate $35 million loss on our first module.
Speaker 4: which reflects the fact that our total project cost estimates exceed the total of revenue to be earned under the Woodside contract and cash to be received under the DOE.
This reflects the fact that our total project cost estimates exceed the total revenue to be earned under the Woodside contract in cash we received under the deal We award.
Speaker 4: From a cash perspective, that estimated loss will be incurred over the multi-year project duration. But accounting rules require us to recognize the loss when our estimates indicate a loss is evident. And that occurred in Q1 2022 with the execution of the Woodside contract and our first commitment to construct and deliver a commercial scale model.
From a cash perspective that estimated loss will be incurred over the multiyear project duration.
Accounting rules require us to recognize the loss when our estimates indicate a loss as evidence and that occurred in Q1, 2022 with the execution of the Woodside contract and our first commitment to construct and deliver our commercial scale module.
Speaker 4: It is possible that our cost estimates could change as we continue executing the project. And if that happens, we will provide updates as we know them.
It is possible that our cost estimates could change as we continue executing the project and if that happens we will provide updates as we know them.
Speaker 4: Ultimately, we can expect a return on this investment in the form of major new contracts for our heliopower modules once this first project is installed.
Ultimately, we can expect a return on this investment in the form of major new contracts for our Helio power modules. Once this first project is installed.
Speaker 4: The success of this project and our other early projects will be defining events for our company because we will be deploying our novel clean energy technology at commercial scale for our customers for the first time.
The success of this project and our other early projects will be defining events for our company because we will be deploying our novel in energy technology at commercial scale for our customers for the first time.
Speaker 4: The real-world operating history, data, and insights that Heliogen and our customers will gain from these first commercial-scale modules has an economic value that goes far beyond the dollars that we will invest with our partners to build these first
The real World operating history data and insights that he'd be agenda, and our customers will gain from these first commercial scale modules has an economic value that goes far beyond the dollars that we will invest with our partners to build these first few systems.
Speaker 4: It's not every day an emerging growth company like ours can say that its first commercial scale facility is being so largely funded by a customer, and that is a testament to both the promise of our technology and the strength of our early customer partnership.
It's not everyday and emerging growth company like ours can say that its first commercial scale facility is being so largely funded by a customer and that is a testament to both the promise of our technology and the strength of our early consumer partnerships.
Speaker 4: We are fortunate and grateful to have such strong strategic partners as Woodside and the DOE leaning in with us in our commercialization.
We are fortunate and grateful to have such strong strategic partners as Woodside and the D O E leaning in with us and our commercialization efforts.
Speaker 4: Our strategy is to deploy single modules with these first few customers as a foundation for much larger multi-module installation.
Our strategy is to deploy single modules with these first few customers as a foundation for a much larger multi module installations we.
Speaker 4: We recognize that some prospective customers will be more comfortable committing to large multi-module projects once they can see the performance, reliability, and efficiency data from our first project.
We recognize that some prospective customers with new more comfortable meeting to large multi module projects. Once they can see the performance reliability and efficiency data from our first projects.
Speaker 4: Meanwhile, for HelioHeat steam modules, we are already in discussions for multi-module projects with the potential for an earlier timeline, since these steam modules have simpler scale-up considerations than HelioPower or HelioHeat.
Meanwhile, for Helio heat steam modules, we are already in discussions for multi module projects with the potential for an earlier timeline. Since these steam modules have simpler scaleup considerations, then helio power or hele fuel.
Speaker 4: As we've discussed previously, we expect to use multiple parallel avenues to drive unit costs down and ultimately achieve attractive levels of profitability for Heliogen, while reducing our customers' carbon footprints and their reliance on
As we've discussed previously we expect to use multiple parallel avenues to drive unit cost down and ultimately achieve attractive levels of profitability for Hughes neogen, while reducing our customers' carbon footprints and their reliance on fossil fuels the.
Speaker 4: The first avenue is economies of scale. Our initial projects are one-off single model.
The first Avenue is economies of scale. Our initial projects are one off single modules. There are certain fixed costs on any project that will not grow linearly with project size and so as we start deploying multi module projects, we expect to see a decrease in the cost per module.
Speaker 4: There are certain fixed costs on any project that will not grow linearly with project size. And so as we start deploying multi-module projects, we expect to see a decrease in the cost per module.
Speaker 4: Higher volume recurring purchases are the second avenue towards cost reduction because when we are buying many receivers or many electrolyzers, for example, we can obtain better pricing from our suppliers.
Higher volume recurring purchases are the second avenue towards cost reduction because when we are buying many receivers are many electrolyze. For example, we can obtain better pricing from our suppliers.
Speaker 4: We're currently focusing our in-house manufacturing capabilities on Heliosats, because even one single module involves thousands of these.
Were currently focusing our in house manufacturing capabilities on Hevea stats, because even one single module involves thousands of these components.
Speaker 4: The third avenue comes from learning curve cost reductions, both in our factory during manufacturing and out in the field during installation, commissioning, and testing as we reap the benefits of repetition that are enabled by our modular approach. Andy Lambert, our Chief Production and Supply Chain Officer, brings a demonstrated track record of consistently delivering significant productivity gains over three to five-year timeframes during his career.
The third Avenue comes from learning curve cost reductions both in our factory during manufacturing and out in the field during installation commissioning and testing as we reap the benefits of repetition that are enabled by our modular approach Andy.
Andy Lambert, our chief production and supply chain officer.
It brings a demonstrated track record of consistently delivering significant productivity gains over three to five year timeframe strange career.
Speaker 4: Our facilities and processes are designed so we will be able to measure our progress on a daily and weekly basis and rapidly make adjustments to improve efficiency and reduce costs.
Our facilities and processes are designed so you'll be able to measure our progress on a daily and weekly basis and rapidly make adjustments to improve efficiency and reduce costs.
Speaker 4: In the meantime, I look forward to sharing further progress with you in the future. And with that, I'd now like to turn it back to Bill for closing remarks.
In the meantime, I look forward to sharing further progress with you in the future and with that I'd now like to turn it back to bill for closing remarks.
Speaker 3: Thank you very much, Christy. I'd like to conclude today's call by saying how thrilled I am to lead Heliagen as we work to help industrial companies decarbonize by cost-effectively eliminating fossil fuels from their energy intensive processes. I look forward to providing you with additional.
Thank you very much Christie.
To conclude today's call by saying, how thrilled I am to lead Gilead, then as we work to help industrial companies decarbonize by cost effectively eliminating fossil fuels from their energy intensive processes.
I look forward to providing you with additional updates as the year progresses.
Speaker 3: Before we open it up to Q&A, please turn to page 10. What we have laid out for you here is what I believe will enable Heliogen to succeed in its mission, while also generating high returns on the capital we are deploying.
Before we open it up to Q&A, Please turn to page 10.
Well, we have laid out for you here is what I believe will enable helix to succeed in this mission, while also generating high returns on the capital we're deploying.
Speaker 3: New Engine offers a differentiated product to the large and growing industrial market by leveraging its proprietary technology.
<unk> offers a differentiated product, it's a large and growing industrial market by leveraging its proprietary technology there.
Speaker 3: This technology is underpinned by cutting edge software that generates efficiencies never seen before in solar energy production.
This technology is underpinned by cutting edge software generates efficiencies never seen before in solar energy production.
Speaker 3: We expect our extensive patent portfolio, our trade secrets, and our learnings to help us maintain and defend these competitive advantages.
We expect our extensive patent portfolio, our trade secrets, and our learnings to help us maintain and defend these competitive advantages.
Speaker 3: The potential of this software extends beyond the field, too, as we plan to apply AI technology across the entire value chain to reduce cost.
Potential of this software extends beyond the field too as we plan to apply AI technology across the entire value chain to reduce costs.
Speaker 3: Thank you so much for your attention, and we look forward to answering your questions.
Thank you so much for your attention and we look forward to answering your questions.
Speaker 1: At this time, we'll be conducting a question and answer session.
Thank you.
At this time, we'll be conducting a question answer session.
Speaker 1: If you'd like to ask a question, please press star 1 on your telephone keypad, and the confirmation tone will indicate your line is in the question queue. You may press star 2 if you'd like.
Would you like to ask a question. Please press star one on your telephone keypad and a confirmation tone will indicate your line is in the question queue.
First start to who would like to move your question from the queue.
Speaker 1: Participants using speaker equipment may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Thank you.
For participants using speaker equipment may be necessary to pick up your handset before pressing the star keys.
One known piece, where we poll for questions. Thank you.
Thank you and our first question comes from the line of Rob Wertheimer with Melius Research. Please proceed with your question.
Hi, good morning, everyone.
Speaker 5: Bill, if I may, I wanted to start out with a couple of technology questions. Supercritical CO2 is a more efficient and kind of interesting new technology in the world. I think there's a couple of complements with what you guys do with power density and modularity. I don't know whether there is additional advantages with the high temperature you generate, which often leads to efficiency in different power applications. Can you just talk a little bit about if there's any special advantages Heliogen brings to that technology?
Bill if I may I wanted to start out with a couple of technology questions supercritical Cotwo as a more efficient and kind of interesting new technology in the world.
I think theres a couple of complements with what you guys do with power density Modularity I don't know whether there is additional advantages with the high temperature regenerate, which often leads to efficiency in different in different power applications can you just talk a little bit about if theres any special advantages helium Jen brings to that technology.
Speaker 3: Yes, you're exactly right, Bob. Right now, concentrated solar has previously run only at temperatures in the range of 500 degrees centigrade, which requires you to use a steam turbine for energy conversion.
Yes, Youre exactly right Bob.
Right now.
Hudson traded solar has previously run.
<unk> only at temperatures in the range of 500 degrees Centigrade, which requires you to use a steam turbine for energy conversion.
Speaker 3: Steam turbines only become efficient at the 50 to 100 megawatt or larger size. So a lot of the concentrated solar CSP plants that have been built have to use 50 megawatt to 100 megawatt steam turbines. The supercritical CO2 turbine can reach the same efficiency at a steam turbine at only five megawatt size because it's running at higher temperature. We can achieve those higher temperatures.
Steve turbines only become efficient at the 5200 megawatt or larger size. So a lot of the concentrated solar CSP plants have been built have to use 50 megawatt 200 megawatt steam turbines.
A critical C O two turbine and reached the same efficiency of the steam turbine I'd only five megawatt size because it's running at higher temperature, we can achieve those higher temperatures so what's the benefit.
Speaker 3: The benefit is a 5-megawatt supercritical CO2 turbine can fit on a skid and be delivered to the site fully assembled. That is a huge advantage for modularity, installation time, reliability, and serviceability, contrasted with a 50-megawatt or 100-megawatt steam turbine, which is a multi-month installation process. So this is the theme of everything.
The benefit is a five megawatt supercritical cotwo herbin can't fit on a skid and be delivered to the site fully assembled that is a huge advantage for modularity installation time reliability and serviceability contrast, it with a 50 megawatt 100 megawatt steam turbine, which is a multi.
Monks installation process. So this is the theme, but everything we're doing at our company is to make things that are modular repeatable and it could be driven down cost through that repetition. So the supercritical C O two turbine deliveries that capability and its our high temperatures, which enable that possibility.
Speaker 3: It's to make things that are modular, repeatable, and can be driven down in cost through that repetition. So the supercritical CO2 turbine delivers that capability, and it's our high temperatures which enable that possibility.
Speaker 5: Perfect, thank you. And then on slide six, you have testing of autonomous robots for cleaning. Obviously, mirrors get dirty, and so you lose efficiency, and so you're trying to keep efficiency high in a cost-effective way. Could you characterize how mature that technology is? Is that something that's easily solvable and easily predictable, or are you still solving fundamental problems there? What's the odds of that working out?
Perfect. Thank you and then on slide six you have testing of our autonomous robots for cleaning.
Obviously, you know the mirrors get dirty and so you lose efficiency and so you're trying to keep efficiency high in a cost effective way could you characterize how mature that technology is is that.
It's something that's easily solvable and easily predictable or you're still solving fundamental problems there.
What's the odds of that working out.
Speaker 3: That capability comes from our basis as a software company.
That capability comes from our basis as a software company. We have all of the internal team who has expertise in autonomous vehicles, both from the Lidar the programming the location finding the image recognition, we use that for our tracking technology. We also use it for cleaning technology.
Speaker 3: We have all of the internal team who has expertise in autonomous vehicles, both from the LIDAR, the programming, the location finding, the image recognition. We use that for our tracking technology. We also use it for the cleaning technology.
Speaker 3: We demonstrated that already at our facility at Lancaster last summer, and we're building that out for commercial deployment at our first sites next year. So we really have great control over that. And it is a important part of our reduction of the O&M costs of the long term operations of our.
We demonstrated that already at our facility at Lancaster last summer and we're building that out for commercial deployment at our first site next year. So we really have great control over that and it is a important part of our reduction of the O&M cost of the long term operations of our plants.
Speaker 5: Given the comparison, I mean, I assume the same thing happens with existing solar thermal where this is, I guess, one of the many problems you're, you're solving or aiming to solve. How often do they get cleaned? And then, you know, how much efficiency are you trying to, you know, to sort of assist in by keeping the mirrors clean and how often you clean them, et cetera, versus what has been possible to date in older solar thermal.
Given the comparison I mean I assume the same thing happens with existing for thermal where this is I guess one of the many problems youre solving our aiming to solve how often do they get cleaned and then you know how much efficiency are you trying to.
Sort of.
The assistant by keeping mirrors clean and how often he cleaning et cetera versus what has been possible to date an older terminals.
Speaker 3: That's a great question. It is an important part of the maintenance and performance of a plant. Typically, because the mirrors have been cleaned
But that's a great question. It is an important part of the maintenance and performance of our plants typically because the mirrors had been cleaned manually people only clean them approximately once a quarter or maybe even as often as once a month, but it's expensive to do that.
Speaker 3: people only clean them approximately once a quarter, or maybe even as often as once a month, but it's expensive to do that. With our autonomous system, our vehicles can clean the mirrors every night.
With our autonomous system, our vehicles can clean the mirrors every night, so that leads to between a 10 and 20% import performance improvement because the mirrors gather dust in between rainfall and we can remove that as we process. The mirrors every single night. So it's a significant both cost advantage and Perth.
Speaker 3: So that leads to between a 10 and 20% performance improvement because the mirrors gather dust in between rainfall and we can remove that as we process the mirrors every single night. So it's a significant both cost advantage and performance advantage to deliver autonomous cleaning. And again, it's one of the core competencies of our company to be able to develop that internal.
Foremost advantage to deliver autonomous cleaning and again, it's one of the core competencies of our company to be able to develop that internally.
Speaker 5: Perfect, thank you. I had a couple questions on timeline on slide six, if I may. For one, once a module starts production, once it's permitted, once you start putting it into the ground, I'm not sure I know what your current timeline is on how long that might take to construct, and I guess therefore, how long it might apply to revenue recognition.
Perfect. Thank you I had a couple of questions on the timeline on slide six if I may.
For one once a module starts production once its permanent once you start putting it into the ground I'm not sure I know what your current timeline is on how long that might take to construct and I guess, therefore, how long it might.
Yeah.
Apply to revenue recognition.
Yeah.
Yeah, Great question, Rob Hi, This is Christie so on the timeline, we have as you know a couple of different product offerings and far helio heat modules that those projects can be constructed in the span of many months, whereas our helio power modules take incrementally longer to.
Speaker 4: So, on the timeline, we have, as you know, a couple of different product offerings. And for our HelioHeat modules, those projects can be constructed in the span of many months.
Speaker 4: Whereas our Helio power modules take incrementally longer to construct and our Helio fuel, which add another increment with the hydrogen element and the electrolyzer take incrementally longer as well. And so what we expect is that by achieving our 2022 guidance in terms of modules contracted that puts us well on track to have several installed modules completed in 2023. So that's currently the time horizon that we're looking at. And then, in the meantime, from a revenue recognition perspective, as soon as we sign contracts, we're immediately able to begin recognizing revenue against those contracts and start earning, which is what you started to see with our, our initial contract with the Woodside customer.
Construct and our helio fuel, which add another increment with the hydrogen element with the Elektra wiser take incrementally longer as well and so what we expect is that by achieving our 2022 and our guidance in terms of module contract and that puts us well on track to have several installed modules completed it.
In 2023, so that's currently the time horizon that we're looking at and then in the meantime from a revenue recognition perspective as soon as we sign contracts were immediately able to begin recognizing revenue against those contracts and start, earning which is what you started to see with our our initial contract with the customer.
Speaker 5: Perfect. And then when you think about ground breaking in the factory and Heliosap production, does the full module construction assume full production lines? I don't know whether you're doing anything with the pilot lines to create enough Heliospats to get a startup.
Perfect and then when you think about the groundbreaking on the factory and helix that production does the.
Full module construction assumed full production lines I don't know, whether youre doing anything with the pilot lines to create inoculate starts to get a start on that.
Speaker 4: Yeah, so we've actually already got our prototyping line up and running, and we're very excited to be on track with our full assembly line Heliosat production for later in the second half of this year. So, that remains on track, and we're looking forward to being able to share the video and some examples of what those Heliosats look like coming off of the line later this year.
Yeah. So we've actually already got our prototyping line up and running and we're very excited to be on track with our full Assembly line heliostat production for a later in the second half of this year. So that remains on track and we're looking forward to being both a share I'm sure the video and anthem.
Examples of what those easiest that looked like coming off the line later this year.
Okay, and then I think I asked last quarter, but can you talk a bit about the progress I know you've had inbound inquiries I don't know if you can quantify how many but I'm sure. There's a lot of interest.
Speaker 5: And then I think I asked last quarter, but can you talk a bit about the progress? I know you've had inbound inquiries. I don't know if you can quantify how many, but I'm sure there's a lot of interest in Heliogen from customers. Can you talk about the steps as customers move from inquiry?
In helium churn from customers can you talk about the steps as customers move from inquiry.
Speaker 5: into, you know, into actual contracts, what the steps are. And then I don't know if you can quantify how many people at different steps, et cetera. I don't know whether most of your customers are waiting to see the first few modules in operation, or whether you have a large number that are working through permitting, you know, in anticipation of, you know, of getting there before watching other facilities operational.
Into intellectual contracts, what the steps are and then I don't know if you can quantify how many people are different steps et cetera, I don't know whether most of your customers are waiting to see the first few modules and operation or whether you have a large number that are working through permitting and anticipation of getting there before watching other.
Facilities operational.
Speaker 4: Yeah. Okay. A lot, a lot of interesting questions there. So let me unpack them piece by piece. So in terms of the steps.
Yeah, Okay, a lot a lot of interesting questions. There. So let me unpack them piece by piece.
So in terms of the steps the steps on the path to getting contracts signed them early on we enter discussions with prospective customers. We've gotten so much inbound inquiry and I think that one of the things that we're most excited about is over the last several months, even we've seen more interest from frankly.
Speaker 4: the steps on the path to getting contracts signed. Early on, we entered discussions with prospective customers. We've gotten so much inbound inquiry, and I think that one of the things that we're most excited about is over the last several months, even, we've seen more interest from, frankly, sectors that we had not even considered when we first embarked on this effort.
The sectors that we had not even considered when we first embarked on this effort and those are things like for example.
Speaker 4: And those are things like, for example, the high-value minerals and desalination, those kinds of things. And so we've seen an expansion in the potential sectors for application of the technology. So that's one thing that, as we're talking about the Q, I would say the sector diversity of the Q has expanded.
The high value of minerals in those cutting you know desalination those kinds of things and so we've seen an expansion in the potential sectors for application of that technology.
One thing that you know as we're talking about the Q I wouldn't say that the sector diversity in the queue has expanded the.
Speaker 4: The other thing that I would say about steps toward progressing to full contracts is that, like you mentioned, we do have steps that include things like permitting and identification of project sites. And so one of the first things that happens when we have an inquiry or when we're exploring a project with a customer is to look at the solar resource.
The other thing that I would say about steps towards progressing to full contract is that like you. Like you mentioned, we do have a stuff that include things like permitting and identification of project sites and so one of the first thing that happens when we have an inquiry or when we're exploring a project with a customer is to look at this.
Solar resource and Fortunately, we've got great Sun access and so many parts of the world and so we continue to focus on you know places like Australia, and South America, and Mexico, and you know even I'm, even looking at South Africa in terms of where the solar resource is incredibly strong and where there's a.
Speaker 4: And fortunately, we've got great sun access in so many parts of the world. And so we continue to focus on, you know, places like Australia and South America and Mexico and, you know, even looking at South Africa in terms of where the solar resource is incredibly strong and where there's a lot of demand.
A lot of demand and so we I would say that in general are in various stages with different prospective customers across that range of inquiry ranging from you know projects entering the queue and getting their solar resource assessed them all the way to actually structuring contracts and looking at specific.
Speaker 4: And so we, I would say that in general, are in various stages with different prospective customers across that range of inquiry, ranging from, you know, projects entering the queue and getting their solar resource assessed, all the way to actually, you know, structuring contracts and looking at specific module locations that we're progressing negotiations on.
Module locations that we're progressing negotiations on them in terms of how customers you know your other part of the question in terms of how customers look at them, whether they sign up now versus waiting to see we've got a mix of both really you know there's certainly our customers who say you know we want to see the project when it's when it's fully completed we wanted to get a chance to.
Speaker 4: In terms of how customers, you know, your other part of the question in terms of how customers look at
Speaker 4: whether they sign up now versus waiting to see. We've got a mix of both, really. You know, there certainly are customers who say, you know, we want to see the project when it's fully completed. We want to get a chance to look at the operating data. And that's the kind of thing that our, you know, our initial modules will demonstrate when we scale up. But there are actually customers that are in our pipeline who we are looking at multi-module projects with even before we.
Look at the operating data and that's the kind of thing that are we you know our initial modules well demonstrate when we scale up but there are actually customers that are in our pipeline, who we are looking at a multi module projects with even before we we have put in the first couple of projects in the ground and.
Speaker 4: We have put the first couple of projects in the ground. And those are the kinds of customers who are really eager to lean forward, you know, in part because they've already made commitments to decarbonization targets and those kinds of things.
Those are the kinds of customers, who are really eager to lean forward in part because they've already made commitments to decarbonization targets and those kinds of things and so there our customers are on that front I would say, particularly on our helio heat offering which has I would say a more direct path to scale up in terms of execution.
Speaker 4: And so there are customers on that front. I would say particularly on our helio heat.
Speaker 4: offering which has, I would say, a more direct path to scale up in terms of execution risk being even lower than on the heliopower offering.
Being even lower than on on the Helio power offering.
Speaker 6: Hopefully that addresses the question. Yeah, let me know if I left anything out there.
So hopefully that addresses.
Yeah, Let me know if that was coming out there.
Speaker 5: No, they did. And then my last question, I think, is just if you look through slide 7 on the Woodside Project, I think, Christy, you gave a pretty good overview of the scale that, you know, you aim to build if orders come in.
No it did.
And then my last question I think is just if you look through our slides definitely Woodside project I think Kristi you gave a pretty good overview of the scale that you aim to build if orders come in.
Speaker 5: that will reduce project cost overall. Is there anything in this project, in the expected loss on it, that informs your, changes your view on your future, you know, profitability per project? I don't know if there's anything going off in this that we should subtract or not, or whether it's really all just scale that comes through and makes the margins that you hope to get in a few years.
That will reduce project cost overall is there anything in this project.
Expected loss on it that that informs your changes your view on your future profitability per project at all if there's anything one off in this that we should subtract or not or whether it's really all just scale that comes through and makes the margins that you hope to get a few years.
Speaker 4: Yeah, you know, that's a great question. So essentially, this is really an investment in our future for the heliopower modules, you know, this this loss that you're referring to on the on this first Woodside contract.
Yeah. That's a great question. So essentially this is really an investment in our future for the Helio power modules. This loss that you're referring to you on the on this first Woodside contract and we are expecting new projects on the back of the success of this project and the Helio power front and then in terms of whether this is.
Speaker 4: And we are expecting new projects on the back of the success of this project in the heliopower front.
Speaker 6: And then in terms of whether this is representative, you know, I think we've always messaged.
A representative you know I think we've always a message to the market than we do expect our initial projects to be loss, making products, which I think is you know typical whenever you're scaling up a new technology, but we're actually very fortunate to have these great partners leaning forward with us because I think it's unusual frankly to have them at noon.
Speaker 4: to the market that we do expect our initial projects to be loss-making projects, which I think is typical whenever you're scaling up.
Speaker 6: new technology, but we're actually very fortunate to have these great partners leaning forward with us because I think it's unusual frankly to have You know new technology companies have so much of their first projects fully funded or the majority of them funded by by prospective customers
Technology companies have so much of their first projects fully fund it or the majority of them funded by by prospective customers and so it's overall a very a very positive story and then in terms of whether you can expect this kind of thing going forward I think as mentioned, we do expect that our first seven.
Speaker 6: And so overall, a very, very positive story. And then in terms of whether you can expect this kind of thing going forward. I think, as mentioned, we do expect our first several projects to be loss making before we transition to Gross margin profitable projects. There is an element of one off nature of this particular project because of the fact that we're combining this with
Projects to be lossmaking before we transition to our gross margin profitable projects. There is an element of one off nature of this particular project because of the fact that we're combining this with the department of Energy Award, which has incremental scope into this so there's some different things that we're doing on this project that I think.
Speaker 4: the Department of Energy award, which has incremental scope. And so there's some different things that we're doing on this project that I think would not have that same expanded scope on future heliopower modules and whatnot. So hopefully that gives a little bit of a sense of how you can look at this project relative to Heliogen's future projects.
Would not have that same expanded scope on future Heathrow power modules and whatnot. So hopefully that gives a little bit of a sense of how you can look at this project relative to heavy against future products.
Thank you.
Speaker 1: At this time, we've reached the end of the question and answer session. I'll now turn the call over to Bill Gross for closing.
At this time, we've reached the end of the question and answer session I'll now turn the call over to Bill gross for closing remarks.
Speaker 3: Well, thank you very much for attending. We're really excited about our progress. I'm here right now in Davos at the World Economic Forum presenting Heliogen tomorrow.
Well. Thank you very much for attending we're really excited about our progress.
I'm here right now in Davos at the World Economic Forum, presenting Healy adjourn tomorrow and here at the Forum climate change and alternative energy is having its netscape moment right now it's like the internet opportunity taking off like a rocket ship in 1995, when Netscape went public the climate investment opportunity is even.
Speaker 3: And here at the forum, climate change and alternative energy is having its Netscape moment right now. It's like the internet opportunity taking off like a rocket ship in 1995 when Netscape went public.
Speaker 3: the climate investment opportunity is even bigger than that. And it's the discussion that's on everybody's lips right now.
Bigger than that and it's the discussion that's on everybody's lips, right now with what's happening with globalization and energy shortages.
Speaker 3: with what's happening with globalization and energy shortages.
Speaker 3: With the fact that natural gas went up by a factor of three in the United States, but in the last year, with the fact that lithium went up by a factor of five in the last year, and with the electrification of transportation, all these minerals, all this energy is needed so badly.
The fact that natural gas went up by a factor of three in the United States, but in the last year with the fact that lithium went up by a factor of five in the last year and with the electrification of transportation. All these minerals. All this energy is needed so badly.
Speaker 3: and renewable energy and the thing that we're doing with Heliogen really ends the geologic lottery.
And renewable energy and the thing that we're doing with Hilli Jen really ends the geologic lottery the idea that some places on Earth happened to have oil under the ground. We can take advantage of so many places on Earth that have sunshine above the ground and we're really excited to pursue this opportunity and grow the company. Thank you. So much for following us and we look forward to sharing more information.
Speaker 3: The idea that some places on earth happen to have oil under the ground, we can take advantage of so many places on earth that have sunshine above the ground. And we're really excited to pursue this opportunity and grow the company. Thank you so much for following us and we look forward to sharing more information with you soon.
With you soon.
Speaker 1: This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.
This concludes today's conference you may disconnect your lines at this time and thank you for your participation.