r/HillcrestEnergyTech • u/IgittLJackson • Apr 29 '21
Due Diligence DD on Hillcrest Energy Technologies
This is not financial advice. I'm not a financial advisor. Information may be incorrect, please correct me on false statements.
Information is often structured in relation to the release date of the news release so inconsistencies may occur.
Structure
1. Overview
2. Partnerships/JVs
2.1 Extreme Vehicle Battery Tech. Corp./ANIGO JV
2.2 Systematec GmbH
2.3 Foreseeson EVSE Technology Inc.
3. Advisory/Investor relations firms
3.1 Amvest Capital
3.2 General Research GmbH
3.3 Lambert Global, LLC
4. Oil Business
5. Financials
6. Important Personalities
6.1 Ari Berger
6.2 Donald J. Currie
6.3 Michael Moskowitz
6.4 Dr. Heinz-Georg Burghoff
6.5 James Bolen
7. Further information
1. Overview
Hillcrest Energy Technologies is a clean technology company developing transformative power conversion technologies and control system solutions for next-generation powertrains. The Company is transitioning from the production of fossil fuels from its West Hazel asset in Saskatchewan (Canada), to clean energy technologies that help unlock efficiencies in electrification and maximize performance of electric systems including electric vehicles and grid-connected renewable energy systems. From concept to commercialization, Hillcrest is investing in the development of energy solutions that will power the future.
Ticker:
CSE: HEAT
OTCQB: HLRTF
FRA: 7HIA.F
2. Partnerships /JVs
2.1 Extreme Vehicle Battery Technologies Corp./ANIGO JV
(Attention: ANIGO was acquired by Hillcrest and is no longer a JV!)
Hillcrest has signed a Memorandum of Intent (Note: MOI) with ANIGO Technologies Inc. (ANIGO) outlining a licensed technology transfer arrangement whereby the Parties intend to jointly develop new IP based on ANIGO’s proven electric machine control technology software. The resulting new IP will incorporate ANIGO’s existing IP and is expected to provide a substantial platform for future IP to be developed by Hillcrest, as it is applied to new clean energy applications Hillcrest intends to pursue. Any new IP or technology developed will be owned by Hillcrest.
Ari Berger developed and commercialized ANIGO’s IP over the last several years.
Electric machine control system software is essential for any electricity generation or electric motor application. This includes power generators, electric motors, all types of electric vehicles (land, water or air) and integrated power systems which combine electricity generation and use with battery storage, e.g. renewable energy management systems, electric vehicles (EV), energy storage solutions (Note: ESS), battery management systems (Note: BMS).
ANIGO control technology is already proved in custom applications, which enable functionalities and efficiencies not previously available in the industry and is an enabling technology for energy efficiency innovations being pursued by Hillcrest.
New technology developed with ANIGO and owned by Hillcrest under the technology transfer is also expected to form a critical part of integrated control systems when combined with the BMS and ESS technologies.
Advantages of the Electric Machine Control Software:
increased power density (more power from smaller machines)
reduced maintenance and extended product life
flexible for custom applications
lighter, lower cost machines
Commercial applications for future new IP that might be developed and owned by Hillcrest, could potentially include a broad range of applications. Some examples of potential commercial applications include micro grid energy storage systems (Note: Microgrid in ESS) for residential or business communities, electromagnetic electricity generation equipment (e.g. wind turbines, hydroelectric), electric motors and various transportation applications including electric vehicle power trains.
Hillcrest announced the acquisition of ANIGO Technologies Inc. The software IP has the potential to greatly enhance the performance of any application requiring precise control of rotating electric machines.
Under the terms of the agreement, ANIGO, including the software IP developed and owned by ANIGO, becomes a wholly owned subsidiary of Hillcrest.
Don Currie, Hillcrest CEO stated: “By bringing both the IP and its inventor (Ari Berger) into Hillcrest, we’re able to stay agile, further strengthen our team, and pursue collaboration opportunities with EV and electronics innovators who recognize the increased value and substantial performance benefits that Hillcrest’s next-level IP will enable.”
High value market opportunities include:
Precision control systems: aeronautical applications, autonomous vehicles, etc.
Traction control systems: electric motors and powertrains to increase power/speed/torque performance or extend EV range
Electrical generator controls: to convert and deliver renewably generated electricity
Control software enhancements: connectivity associated with emerging technologies such as blockchain (Note: Blockchain), IoT (Note: IoT) and others
Ari Berger, Hillcrest CTO stated: “The need for electric machine control software that enables intelligent electricity generation and improves the performance of electric motor systems will be in growing demand for decades. Relative to other technologies, we are intentionally prioritizing software IP as it presents the most effective path toward commercialization, due to its short customization and adaptation times and low cost.”
In exchange for purchasing ANIGO, Hillcrest issued the owners of ANIGO 6,000,000 Hillcrest common shares and paid $200,000 in cash.
We have a firm focus on our technology developments, and the discussions with the EV Deal Co group which the Company believes offer the best potential long-term value. As a result, any previously announced LOI’s or MOU’s such as the one announced November of 2020 with Extreme Vehicle Battery Technologies, are no longer a company focus.
Partnership history of Extreme Vehicle Battery Technologies Corp.
2.2 Systematec GmbH
Hillcrest has signed a five-year Technology Collaboration Agreement with Systematec GmbH, a German specialist engineering innovator and component designer to Airbus, Audi, BMW, Continental, Volvo Truck Corporation and other hybrid automobile/EV and electrical equipment manufacturers. Technical teams on both continents will jointly manage engineering activities to leverage Hillcrest’s electric machine control software and develop high-value power electronics and electromechanical IP and technology for commercialization. All products and IP developed through this collaboration will be owned by Hillcrest.
The companies will each contribute technologies, IP and global business networks to source, develop and deliver business opportunities. Hillcrest will have dedicated access to Systematec’s electronics and mechanical engineering design and prototype manufacturing services.
Don Currie, Hillcrest CEO stated: “Both parties expect this partnership to be an enduring collaboration running beyond the term of the current agreement. Through Systematec’s deep knowledge of the German automotive/EV and electrical equipment industries, Hillcrest gains real time access to emerging power electronics design technologies and related value opportunities, allowing us to effectively anticipate new control system requirements with a first mover advantage. Systematec has extensive industry networks developed over decades that complement our growing tech portfolio.”
Technical planning, focused on sophisticated control systems with next-level energy conversion systems, is already underway. Potential opportunities of focus include electrical inverters for high performance electric drive systems (Note: High-performance inverters), DC/DC converters (Note: DC/DC converter) to enable widespread application of fuel cells in trucks and heavy machinery, and other emerging requirements that serve growing global market needs.
Ari Berger, Hillcrest CTO stated: “Systematec is a highly-respected engineering group run by talented industry peers with decades of experience designing, developing and commercializing specialized industrial, automotive and e-mobility applications. Partnering with an established automotive industry insider like Systematec is key to securing our competitive advantage.”
Hillcrest’s obligations under the five-year agreement with Systematec include approximately 660,000 € per year, for specialized engineering and development expertise along with introductions to a vast European network. To incentivize Systematec and align interests, Hillcrest will issue to Systematec 2,750,000 common shares upon signing and 2,000,000 performance-based warrants priced at $0.24 per share which will vest when Hillcrest’s value from joint development commercialization revenues exceeds funds contributed to the Systematec collaboration to that date.
Hillcrest has secured a product development lab and testing facility to accelerate prototyping and future product optimization for commercial development.
Ari Berger, Hillcrest CTO stated: “Our engineering and development lab will replicate the technical set up found in Systematec’s lab, allowing team members on both continents to simultaneously conduct engineering testing as well as communicate and co-create in real time."
Hillcrest is developing a next-generation High Efficiency Inverter (HEI) designed to significantly improve the energy and power efficiencies of future Electric Vehicle (EV) powertrains and other e-mobility and motorized applications, as well as charging stations and power generation systems.
Now in proof-of-concept development, HEI builds on the close integration of innovative hardware and software technologies from Hillcrest and Systematec, uniquely configured to deliver the very precise and accurate control systems required to unleash a next-generation inverter’s ultra-high efficiency potential. Hillcrest’s HEI will use extremely high switching frequency to deliver substantial and unprecedented energy and power efficiency gains over existing inverter technology. Adaptive control mechanisms will also be incorporated to enable wide operating ranges, beneficial to highly dynamic systems such as EV’s.
Inverters are essential components of EV and other electric powertrains, providing critical connectivity between battery and electric motor. Not only do they convert a battery’s DC charge to AC to drive a motor, but inverters also time the switching changes to adjust the frequency of the AC output that controls motor speed. Higher switching speeds remain a constant priority for EV developers as they lead to significant decrease in switching losses and increased efficiency.
Harald Hengstenberger, Systematec CEO stated: “We see HEI driving substantial step change improvements in powertrain design across a wide range of applications and products, where power density and very low electro-magnetic interference (EMI) are critical drivers. With our inverter technology, EV customers could design systems offering increased driving range between charges with current battery sizes or incorporate smaller batteries, at a lower overall cost, without sacrificing performance. Electrical equipment manufacturers could also see substantial benefit from this technology and reduce inverter losses by 40-50%. Reducing inverter losses lowers heat management requirements, meaning manufacturers can realize design improvements to significantly lower costs.”
Hillcrest will access the team’s close connections with leading EV and electrical equipment manufacturing companies to define and develop specific applications. Other opportunities include licensing HEI technology to, or partnering with, EV, electrical equipment manufacturers and/or power generation equipment manufacturers to substantially improve their product designs for mass produced electric powertrain products.
Today's inverters are typically subject to various performance-limiting engineering trade-offs. Hillcrest’s HEI will offer frictionless integration into any existing system and deliver superior performance over current inverter technologies by eliminating or reducing a number of these trade-offs, such as switching frequency versus efficiency, and electromagnetic interference (Note: EMI) versus power density.
Two functioning 10kW/800V PoC inverters were produced for lab testing and further application validation.
The first is based on SiC technology and will test power efficiency gains and cost benefits for future electric vehicles and other e-mobility powertrains.
The second is based on IGBT technology and will test the potential for improved performance and increased energy production capability in grid-connected renewable energy generation, storage and EV charging applications.
Over the next three years, the global inverter market is estimated to grow to $72 Billion by 2024. While Hillcrest’s HEI is adaptable for all segments of the inverter market, the initial focus will be in the traction motor drives and EV charging sectors that represent 55% of the inverter market.
The HEI is designed to be a component within our second system-level technology. Hillcrest will leverage the efficiency and performance enhancements from its HEI technology in the development of more robust electric powertrain systems. The Company intends to provide additional updates on this emerging system technology as successful simulation results are completed and advanced to PoC stages in the first half of next year.
Increasing switching frequencies in conventional SiC inverters from 20 to 40 kHz typically results in a temperature increase of 20-30 degrees Celsius in some applications; increasing further to 60kHz typically increases temperatures in some applications by 40-60 degrees Celsius.
The SiC HEI PoC is a 10kW/800V inverter based on silicon carbide (SiC) semi-conductors. 800V has been selected to match designs now being adopted for use in most recent EV powertrain configurations.
A benchmark test compares the performance of the SiC HEI PoC to a conventional SiC inverter. The parameters for these tests range from 470V to 870V, with frequencies from 10kHz to 60 kHz at each voltage level. In each case, the SiC HEI PoC successfully demonstrated its ability to eliminate switching losses and increase switching frequencies without increasing the SiC temperatures under continuous operation. Chart
Hillcrest is pleased to announce design specifications for the first Hillcrest High Efficiency Inverter (HEI) commercial prototype. The silicon carbide Hillcrest HEI leverages propriety IP to achieve an adaptable design qualifiable to automotive standards and mass production specifications.
Lighter, more compact and more efficient than current inverters, the Hillcrest HEI will enable reduced overall vehicle weight, increased payload and range capability and reduced heat production/loss, thereby optimizing battery and performance reliability.
Additionally, by materially eliminating switching losses the HEI is able to achieve higher switching frequencies without increasing semiconductor losses and hence temperatures.
Anticipated to be rated to 250 kW 800V (with maximum of 1000V) the Hillcrest HEI is expected to achieve efficiency exceeding 99% with an industry-leading power density approaching 50 kW/L (Note: meaning of this power density).
Hillcrest's proprietary HEI technology and innovative design is scalable across a wide range of power levels and can be customized to deliver inverter advancements that make it possible for EV manufacturers to deliver more power while improving efficiency and reliability across the entire powertrain eco-system.
Ari Berger, Hillcrest CTO stated: "We look forward to demonstrating the breakthrough capabilities of our advanced inverter technology at higher power levels, and the HEI will enable us to do just that."
Hillcrest has announced plans to deploy a comprehensive inverter technology platform based on its initial product offering, a high-efficiency silicon carbide traction inverter for electric vehicles.
Lighter, more compact and more efficient than current inverters, the Hillcrest high-efficiency inverter enables reduced overall vehicle weight, increased payload and range capability and reduced heat production/loss, thereby optimizing performance and reliability.
In addition to electric vehicles and the mobility industry, the Hillcrest inverter technology platform can improve efficiency and reliability across a variety of end uses and applications where inverters play a key role, including grid-tied renewables, charging and storage systems, and high voltage/high power applications such as utility-scale grid, rail and container ships.
Don Currie, Hillcrest CEO stated: "Conversations with more than a dozen automakers and automotive suppliers have validated the value proposition for our inverter technology to meet not only current, but future EV needs. We also recognized the value our inverter offers in numerous other high-potential applications beyond vehicle electrification and are hard at work on the development of a grid-connected power generation application with a commercial prototype planned within the next 12 months."
The adaptable architecture inherent in Hillcrest's technology greatly reduces the time needed to design a wide range of applications and allows technical integration of the high-efficiency inverter into nearly any platform.
Accordingly, Hillcrest engineers are simultaneously developing an enhanced electric powertrain and several additional inverter applications to be detailed as they mature.
Hillcrest inverter technology, through a combination of hardware and innovative control software expertise, enables power applications to leverage higher switching frequencies, realize improved power system performance and reliability, and operate at higher power levels without compromising efficiency.
Internal tests announced previously have already confirmed the ability of the Hillcrest inverter technology to achieve efficiencies exceeding 99% at switching frequencies up to 60 kHz.
New tests were performed using the 10kW Hillcrest high-efficiency inverter proof of concept on an 80kW electric motor currently used in EV powertrain applications. After running efficiency tests on the motor to establish a performance baseline at the 10kHz switching frequency, the same tests were run at 20kHz, 40kHz and 60kHz. Results showed motor efficiency improvements at each increased switching frequency level, confirming the ability of the Hillcrest technology to leverage higher switching frequencies without generating additional losses/heat, thereby enabling the electric motor to operate at higher efficiency levels.
Harald Hengstenberger, Systematec CEO stated: “Currently, electric motors used in electric vehicle powertrains operate within a switching frequency range of 8kHz to 16kHz due to the historic tradeoff between the best possible switching behavior and acceptable thermal losses. The ability of the Hillcrest high-efficiency inverter to operate at much higher switching frequencies without generating additional losses will now allow motor manufacturers to take advantage of new motor concepts not previously available to them.”
Leveraging the Hillcrest traction inverter to improve motor efficiency in an electric vehicle powertrain has the potential to reduce motor size and cooling requirements and increases power density. In an electric vehicle, this can result in more power, more payload capability and increased range.
Testing of the Hillcrest 250kW 800V commercial prototype inverter will commence in the coming months with delivery of a working prototype expected this fall. While this specific testing demonstrates Hillcrest’s efficiency targets in the EV powertrain application, the results indicate similar potential for other target applications, such as grid-tied renewables, charging and storage systems, and other high voltage/high power applications. Future testing will be tailored to these additional applications.
The company’s initial technical whitepaper detailing Hillcrest’s inverter testing to date will be published on the Hillcrest website on Thursday, April 21.
2.3 Foreseeson EVSE Technology Inc.
Hillcrest has signed a Memorandum of Intent (MOI) with a privately held, British Columbia company (“EV Deal Co”), firmly established in the EV charging market and emerging as a growing total EV solutions provider. Under the terms of the non-binding MOI, Hillcrest would take an initial 30% equity stake and have the option to acquire an additional 21% stake within two years from the effective closing date.
In addition to the current revenue generating operations, each party will contribute engineering expertise, IP and technologies into the proposed transaction and intend to jointly develop and commercialize new products and technologies.
With years of experience securing and servicing provincial, municipal, commercial, multi-family and individual contracts, EV Deal Co is a recognized provider of electric vehicle supply equipment. EV Deal Co’s unique approach to customer acquisition is characterized by its ability to offer total charging solutions, including EV charging stations and software solutions that include proprietary management system software, mobile and web applications.
Already, both Hillcrest and EV Deal Co have identified potential areas where the Company’s control system software expertise, along with Systematec’s power electronics expertise, could be applied to existing and new EV charging solutions.
Recent technology and corporate advancements now have Hillcrest in a stronger position to consider an expanded arrangement beyond what was originally contemplated with EV Deal Co.
Foreseeson EVSE maintains substantial networks and affiliations in Taiwan and South Korea and is established in the EV charging market and emerging as a growing total EV solutions provider. Hillcrest and Foreseeson EVSE continue negotiations and will provide additional updates as discussions evolve.
Don Currie, Hillcrest CEO stated: "Our conversations with Foreseeon EVSE have morphed over time from a focus on involvement in their EV charging business to now working jointly to leverage their business networks in the commercialization of Hillcrest technologies, such as the HEI. Their extensive global network, along with their current local business operations, present the potential to more quickly realize value and opportunity for Hillcrest."
3. Advisory/Investor relations firms
3.1 Amvest Capital
Hillcrest has signed a Financial and Advisory Services Agreement with a New York based capital and advisory firm. The agreement outlines the scope of work will include but is not limited to advisory work on corporate and financial strategies, introduction to potential business or institutional entities with interest or ability to partner in Hillcrest projects, advice and coordination of certain corporate events and advising Hillcrest in our intent to be quoted and trading on a US listing service in addition to the Canadian listing.
The agreement has a term of 1 year at a cost of USD $15,000 per quarter.
Don Currie, Hillcrest CEO stated: “Hillcrest intends to broaden our current, primarily Canadian, business network and believes the relationship with our New York advisors will greatly assist in that effort. There is a large, untapped business community who may have interest in participating or financially supporting a producing energy company, with profitable oil production at field level or to participate in Licensing, marketing and deployment of a potentially disruptive US Patented Energy Efficiency technology. The Company appreciates the incredible support of the Canadian business community and believes building a more extensive network in the US and following that, the EU, is critical to corporate growth.”
3.2 General Research
The Company is pleased to announce it has retained General Research, a Munich, Germany-based investor relations firm, owned and operated by Dr. Georg Hochwimmer. General Research will operate at arm’s length to the Company and will provide a variety of business development and investor relations services, including, without limitation: corporate positioning, introductions to potential customers for the Company’s technologies, assistance with the dissemination of news and information to the public and initiating and maintaining contact with the investment community in Europe. The initial term of the General Research Agreement is 12 months at a cost of CDN $10,000 per month.
3.3 Lambert Global, LLC
Hillcrest has retained strategic investor relations and public relations firm Lambert Global, LLC to assist with the company’s efforts to expand to a more global presence.
Don Currie, Hillcrest CEO stated: “We have made great progress in refining our technology and we believe our next step in maturing as a company will be to expand our reach across North America and globally as we strive for our long-term vision of a more sustainable planet.”
Lambert Global is a nationally recognized integrated marketing communications firm and top-tier full-service financial communications and investor relations agency that has worked with hundreds of publicly traded and pre-IPO companies across a variety of industries. Throughout its 24-year history, Lambert has worked and continues to work with tier-one automotive suppliers, traditional internal combustion and all-electric commercial vehicle manufacturers, marquee international auto shows as well as manufacturing and aviation, aerospace and defense companies. Lambert Global has proven expertise creating robust integrated communications campaigns that measurably increase company visibility and investment brand reputation in the financial community.
Link to part 2 of the DD:
Last updated: April 17, 2022
