Ener1, Inc. and Russia’s JSC Mobile GTES (MGTES) have signed a strategic framework agreement to manufacture lithium-ion-based uninterruptible power supply (UPS) systems as part of a five-year engineering and framework agreement. MGTES is a wholly-owned subsidiary of the Federal Grid Co. (FGC) of Unified Energy System.

Ener1 and MGTES previously signed a $40-million energy storage supply contract in November 2010. This new framework agreement follows a new Memorandum of Understanding (MOU) signed by both companies in March 2011. The purpose of the framework agreement is to set forth the parameters of what is contemplated to be a five-year supply arrangement. The effectiveness of the agreement is contingent upon specific conditions, including the parties negotiating and determining the number of units to be supplied, unit pricing, services to be provided, completion of a feasibility study, board of director approval by both companies, and finalization of other technical specifications.

The contemplated UPS systems are intended to provide near-instantaneous power back-up for FGC’s substation equipment to enable a more reliable bulk power transmission system. Coupled with Ener1’s battery management system, the UPS systems constitute a crucial element of FGC’s smart grid, which will enable electric power production, transmission and consumption to be controlled and optimized in real-time with a view toward ensuring maximum performance. MGTES would handle the on-site delivery, installation and subsequent operation of the UPS systems.

The proposed UPS systems -- which the companies anticipate will have an initial total capacity of 27.8 MW -- will provide back-up power for internal substation needs for one hour, including switchgear, lighting, communications and other needs. FGC believes this lithium-ion solution will have expanded capabilities beyond the company’s current lead acid solution, which is only able to back-up the switchgear for a short duration and does not provide back-up power for any other internal substation needs.