National Wealth Fund backs proposed £20m Invinity raise after UK investment warning

Invinity Energy Systems is seeking to raise at least £20 million, with fresh backing from the National Wealth Fund, just weeks after warning that it could reconsider further investment in British battery manufacturing.

The NWF, which already owns approximately 19% of Invinity, has conditionally agreed to invest at least £10 million, subject to matching investment from other investors. A separate retail share offer could increase the total fundraising to £25 million.

Of the initial £20 million, Invinity plans to spend £10 million on developing its vanadium-flow batteries and reducing production costs, £8 million on working capital and £2 million on manufacturing capacity across the UK and US.

This is not the first time Invinity has received backing from the National Wealth Fund. It initially invested in the firm back in 2024, investing £25 million to help commercialise Invinity’s technology and expand its manufacturing in Scotland. 

Following that investment, Invinity opened a larger facility in Motherwell, increasing its stated UK battery assembly capacity to more than 500MWh annually. But since then it has warned that its future investment could be in jeopardy after only one of 21 eligible projects proposing its technology entered Ofgem's provisional first-round LDES portfolio.

The company said it needed to make decisions about its British facilities quickly, with opportunities overseas potentially influencing where future investment would be directed. That could prove awkward for the National Wealth Fund which was set up to help drive economic growth in the UK. 

Uncertainty over future orders

It’s not exactly surprising to see Invinity reassess its commitment to the UK, however. After all, it ultimately has to prove it can grow into a profitable business – and at the moment, things aren’t looking like a sure thing, as the company has removed 2028 from its published revenue outlook. It cited uncertainty over when prospective battery projects will progress through financing, planning and grid connections, as the reason. 

Its commercial pipeline stood at approximately 12.8GWh in September, but only 77MWh represented signed unconditional orders. That leaves the company facing uncertainty over when it will need additional manufacturing capacity, despite the substantial potential demand for its batteries.

The proposed fundraising is intended to provide enough working capital to support operations into the first half of 2028, while allowing Invinity to continue developing its technology and reducing production costs.

The fundraising remains subject to shareholder approval, however.