Dive Brief:
- Acciona Energía, a Spanish energy company, has signed an agreement with Qcells, a subsidiary of South Korean industrial group Hanwha Corp., to acquire the largest battery energy storage system project in Texas. Terms of the deal were not disclosed.
- In addition to the 190MW/380MWh Cunningham project, which is scheduled to be commissioned in the first quarter of 2023, the deal includes the acquisition of a portfolio of more than 1GW/2GWh of BESS projects in development.
- Acciona said the battery energy storage systems help reinforce grid stability and improve energy security, “offering a solution to unforeseen or exceptional situations such as Winter Storm Uri,” which devastated the Texas grid in 2021 and led to 246 deaths.
Dive Insight:
The standalone battery storage facilities in the deal will supply power and ancillary services to the Electric Reliability Council of Texas. The Cunningham project, which is 55 miles from Dallas, contains 159 cabinets of 2.4MWh blocks.
Acciona Energía operates more than 1GW of wind and solar power in the U.S. and has a portfolio of four photovoltaic solar plants under construction in Illinois, Ohio and Texas separate from the acquisition.
CEO Rafael Mateo said in the news release that Acciona Energía has been working on battery storage for more than 10 years and the technology is ready for commercial deployment.
“This transaction is an important milestone, as it includes the biggest BESS utility scale project in one of the world’s most developed BESS markets,” he said. ”With 1,214MW renewable capacity operating and under construction in Texas, this deal is a good opportunity for ACCIONA Energía to strengthen our presence and optimize the risk profile of our portfolio.”
The projects are eligible for investment tax credits available through the Inflation Reduction Act, Acciona said.
Texas regulators and ERCOT have been working to improve power reliability since Winter Storm Uri. Despite several market improvements and new generator weatherization requirements, the grid’s reserve capacity is lower this season than it was last year, ERCOT President Pablo Vegas said in November.
Developers and power plant owners plan to increase utility-scale battery storage capacity in the U.S. nearly fourfold in the next three years, reaching 30 GW by the end of 2025, according to the U.S. Energy Information Administration.
Clarification: We have updated the second bullet in this story to clarify that the deal includes the acquisition of a portfolio of more than 1GW/2GWh of BESS projects in development.
