Investing.com -- Energy storage solutions firm NeoVolta is on track to begin production at its FEOC-compliant Georgia battery storage facility in the third quarter, with the company’s $200 million letter of intent with Infinite Grid Capital expected to convert into binding purchase orders in the coming months, CEO Ardes Johnson has told Investing.com.

In late May, Infinite Grid Capital, which develops and finances large-scale power projects across North America, announced it had entered into a Letter of Intent (LOI) with NeoVolta for the strategic procurement of utility-scale battery energy storage products, to be manufactured at NeoVolta’s Pendergrass, Georgia manufacturing facility.

Johnson revealed that NeoVolta and Infinite Grid have since identified specific project locations and technical specifications, with Infinite Grid now working through project financing, a step he described as the standard procedural gate before formal purchase orders are issued.

He stated that the first project is expected to secure financing "in the coming months," triggering initial purchase orders and shipments.

When it comes to pricing, Johnson explained that the company’s recent FEOC compliance clearance is less about undercutting Chinese imports on price and more about qualifying for major projects at all.

With tariffs on Chinese-origin battery energy storage systems running between 55% and 60%, he noted that FEOC compliance has become a strict requirement for developers seeking investment tax credit eligibility and project financing.

"The metric investors should focus on is our capture rate: how much of our Georgia output goes into ITC-qualified, FEOC-compliant projects where bankability, not price, is the deciding factor," Johnson said.

Looking ahead, Johnson pointed to three operational milestones for investors to track over the next 12 months, including completing site acceptance testing by the end of August ahead of the Q3 production start, manufacturing yield and throughput as the plant scales toward an initial 2 GWh annual run-rate with room to grow to 8 GWh, and converting its existing pipeline, including the Infinite Grid letter of intent, into binding, tax-credit-eligible shipments.

Looking 12 to 18 months out, Johnson believes NeoVolta will be "fundamentally transformed" from the company it is today, with a fully operational, high-capacity manufacturing plant serving utility- and commercial-scale customers alongside its existing residential business.

"The scale of the company will make the NeoVolta of today unrecognizable," he commented. “We have the strategy and the operational footprint to become a dominant leader in domestic BESS manufacturing. This is the transformation that takes us from where we are today to where we believe this business belongs over the next 18 to 24 months, and we intend to get there.”