Turkish utility Rönesans Enerji has ordered Nordex turbines totalling 189MW for three onshore wind projects in Turkey.
Rönesans subsidiary Heitkamp Industrial Solutions is set to act as EPC contractor on the developments, which are the 84MW Sağıluşağı project in Malatya, Eastern Anatolia; the 56MW Osmancık project near the city of Çorum; and the 49MW Kayalar project near the city of Sivas.
Shipping groups are testing high-tech sails to improve fuel efficiency and reduce carbon emissions. We look at how this new approach to an old technology could help the industry towards its goal of 50% emissions reduction by 2050.
People have been using wind to power boats for thousands of years. In ancient Egypt, the use of sails with rigging systems is thought to have originated around 6,000 years ago. Of course, this technology has long since been overtaken in the global shipping sector, where container ships are powered by engines, not sails.
But is wind the future of shipping once more?
On Monday, marine engineering company BAR Technologies and Japanese group Mitsubishi Corporation unveiled a container ship that is using wind power to aid its propulsion. The Pyxis Ocean has been retrofitted with BAR's WindWings technology, which act as high-tech sails that use the wind to improve vessels’ fuel efficiency by 30%. Yara Marine Technologies acted as industrialisation partner.
Food producer Cargill has chartered the Pyxis Ocean, and has said WindWings could play an important role in supporting decarbonisation in the shipping industry. BAR Technologies has co-funded its research in WindWings with the European Union’s greener shipping initiative CHEK Horizon 2020; and is set to monitor performance of the technology in the coming months to refine its design and operations.
Bernoulli benefits
The large wing sails of WindWings are 37.5 metres tall each, and can be fitted to the deck of either an existing or new-build cargo ships. Their curved three-panel design takes advantage of the Bernoulli principle: spreading out the air in front of the ‘sails’ leads to a decrease in air pressure in front of the sail, while concentrating the wind in the sails increases the pressure behind them. This creates lift that helps the ship to move faster – and is the same principle that is used to make wind turbines turn.
BAR Technologies said the system has two key benefits: first, it uses wind power to help move the ship meaning that less fuel is needed; and second, it helps the ship to travel in a direction that takes most advantage of the surrounding wind conditions, which again improves efficiency. The firm said it could install three or four WindWings on the most common vessel sizes, and would work on new solutions in the coming years.
The WindWings themselves can stow flat when they are not needed or would be in the way, such as when a ship is docked.
John Cooper, chief executive at BAR Technologies, said “innovation must come to the fore” if international shipping is to reduce carbon dioxide emissions. The International Maritime Organisation has set a goal for the shipping industry to reduce greenhouse gas emissions 40% by 2030 and 50% by 2050 compared to 2008 levels, and Cooper said making use of wind was an important part of the solution.
“Wind is a near marginal cost-free fuel and the opportunity for reducing emissions, alongside significant efficiency gains in vessel operating costs, is substantial,” he said. Cooper said WindWings could save 1.5 tonnes of fuel each per day, and this potential was even greater on transocean routes.
BAR Technologies and Yara are set to produce hundreds of WindWings in the next four years, both in the fleets of early adopters like Cargill and in the industry at large.
This is not the only solution of its kind. In March, Alfa Laval and Wallenius-backed joint venture Oceanbird installed a land-based prototype of its Wing 560 project at the Oresund DryDocks shipyard in Sweden. The goal is to install the system on an existing vessel in mid-2024 as part of the EU-funded Orcelle Horizon project.
In addition, Japanese shipping group Mitsui OSK Lines and utility Tohoku Electric Power last October announced the start of operations for the world’s first coal ship, using its Wind Challenger technology; and French start-up Zéphyr & Borée launched its sail-powered cargo ship Canopée.
These high-tech sails are not the only answer to make shipping net zero. We will not see ships completely jettison engines. However, these sails can play an important role in making shipping ‘greener’, alongside the increased use of environmentally-friendly fuels, including those derived from green hydrogen, and other inventions to improve cargo ships’ fuel efficiency, such as more hydrodynamic hulls.
The rest of this year will provide vital insights about how big a role these new wind-powered technologies can play in shipping. But this shows that moves are afoot to make container ships ‘greener’, both inside and outside the fuel tank.
Enel subsidiary Endesa has won approval from the Spanish government to replace its As Pontes coal power plant in Galicia, northwest Spain, with 1GW of wind power.
The Ministry for the Ecological Transition & the Demographic Challenge on Saturday approved the closure of the facility, which is Endesa's last coal plant on the Iberian Peninsula. Endesa already has environmental approval for 650MW of the planned 1GW wind capacity.
Vestas has won a 288MW order from an undisclosed customer to supply turbines for two wind projects in the US.
The Danish manufacturer is set to begin delivering the turbines in the second quarter of 2024 and commission them by the end of September 2024.
Brockwell Energy has signed a seven-year power purchase agreement to supply EDF with electricity from the 220.5MW North Kyle onshore wind farm in Scotland.
Brockwell is building the project in East Ayrshire and is set to commission it in early 2025. North Kyle is expected to produce 630GWh of electricity each year.
RES Group has picked Nordex to supply 49 cold-climate turbines for the 280MW Forty Mile onshore wind farm in Alberta, Canada.
The project is due to be commissioned in the first quarter of 2025.
Serbia has awarded contracts for difference (CfDs) of 400MW at onshore wind projects totalling 686.5MW in its debut renewable energy tender.
PowerChina and CWP Europe secured a CfD at €64.46/MWh for 210MW of the 291MW Vetrozelena project; Enlight K2-Wind won a CfD for 68MW of the 95.5MW Pupin project at €68.88/MWh; a group led by Masdar won a CfD for 108.5MW of the 150MW Čibuk 2 project at €73.70/MWh; and Crni vrh Power secured a CfD for 13.5MW of the 105MW capacity it submitted, in developments with total headline capacity of 150MW.
Australian consortium Elanora Offshore is developing a 5GW offshore wind farm off the coast of Gippsland in Victoria, Australia.
The group is led by Kima Energy, with partners including Energy Australia, Boskalis, Respect Energy and Polpo Investments. Maya Malik, chief executive at Elanora Offshore, has worked in the energy sector for two decades, including 12 years in offshore wind at Copenhagen Offshore Partners and Ørsted.
Green hydrogen electrolyser maker ITM Power has reported a loss of £94.2m in its 2023 financial year but said it is making "tangible progress" to tackle supply issues.
The company has reported its results for the year that ended on 30th April 2023. It saw revenue fall 7% year-on-year to £5.2m and its EBITDA loss more than double to £94.2m in the same period. However, it said that increased deliveries in the last six months showed it was making progress to boost revenue and narrow losses in 2024.
Australian energy firm Snowy Hydro has agreed to buy 40% of the electricity and green certificates from the 756MW first phase of TagEnergy's Golden Plains wind project.
TagEnergy is developing the 1.3GW Golden Plains project in Victoria, Australia, and achieved financial close on the 122-turbine 756MW first phase in November 2022. TagEnergy started building the scheme in April 2023 and is due to commission it in early 2025.
India has defined 'green' hydrogen as having well-to-gate emissions of less than 2kg of carbon dioxide emissions for every kilogram of hydrogen produced.
The country's Ministry of New & Renewable Energy has shared the definition to give clarity to developers and investors as it steps up tendering for green hydrogen projects. The definition includes electrolysis-based and biomass-based hydrogen production methods.
US retail giant Walmart has commissioned a green hydrogen production plant that it developed with Engie at its Quilicura Distribution Center in Santiago, Chile.
Walmart said the first phase of the project would enable it to replace lead-acid batteries of 200 forklift cranes with hydrogen energy cells; and the company added that it aims to run on 100% green hydrogen in Chile by 2025.
The business and scientific communities are bringing forward innovations designed to improve the efficiency and reduce the cost of green hydrogen production. We look at five innovations announced in the last month.
Oil giant BP’s innovation arm BP Ventures last week led a $12.5m series A funding round in green hydrogen electrolyser technology firm Advanced Ionics.
The other investors in the round included Clean Energy Ventures, Mitusbishi Heavy Industries and GVP Climate, but it is BP that has garnered the headlines. The scale of the investment is minuscule for BP, which reported profits of $28bn in 2022. Even so, this has highlighted the activities in the business and scientific communities that are aimed at improving the efficiency and reducing the cost of green hydrogen.
In this article, we run down five innovations we have seen in the last week that their proponents said could help make the green hydrogen sector more competitive:
Advanced Ionics has raised $12.5m to support initial deployments of its Symbion water electrolyser technology in heavy industry. The company said its technology uses low-temperature water vapour to produce hydrogen using 30% less electricity than typical green hydrogen electrolysers; and that the water vapour in its systems could come from heating systems already used in the industrial sector.
The company said this meant it could use less than 35kWh of power to produce a kilogram of green hydrogen, compared to more than 50kWh in existing systems. It said this could make green hydrogen available at scale for under $1 per kilogram.
Advanced Ionics is currently working with Spanish oil giant Repsol on a series of pilot deployments for its technology, and is now planning to do likewise with BP.
“The results we’ve achieved in our testing along with early customer interest have indicated that we are an ideal technology provider for industrial customers looking to augment, expand or replace their existing hydrogen production facilities with green hydrogen,” said Chad Mason, chief executive at Advanced Ionics. New investment and interest from big-name backers will show if it can achieve its scale-up plans.
Australian start-up Hysata last week secured A$20.9m ($13.5m) backing from the Australian Renewable Energy Agency to test its green hydrogen electrolysers at commercial scale at a manufacturing facility in Port Kembla, New South Wales.
Hysata said its ‘capillary-fed electrolyser’ could transform the economics of green hydrogen by improving the efficiency of electrolysers from around 75% for existing commercial electrolysers to 95%. Hysata uses capillaries that are similar to delicate blood vessels in the human body to carry water to the electrolyser’s electrodes. By doing this, it says its technology stops air bubbles gathering around the electrodes and reducing efficiency.
After testing the technology in Port Kembla, Hysata will then deploy it at Stanwell’s Rockhampton power station in Queensland in 2025. After validation, its plan it to roll out the electrolysers in projects with headline capacity of 1GW or more.
Paul Barrett, chief executive at Hysata, said its electrolysers could produce green hydrogen at less than $1.50 per kilogram, which is needed to increase uptake of the renewably-produced fuel in hard-to-abate sectors.
Scientists at University of Colorado last week announced they have found a more efficient way to produce green hydrogen than conventional methods.
Traditionally, green hydrogen is made using electrolysis to split molecules of water into hydrogen and oxygen, but the Colorado scientists said they are working on a ‘thermochemical’ approach that uses iron-aluminate materials and the sun’s rays to conduct those reactions at high pressures. They said this could more than double the efficiency of green hydrogen production, and could be the first commercially-viable way to produce synthetic gas for use in petrol, diesel and kerosene.
Kent Warren, one of the study’s two lead authors, said he hoped it would open the way for transport fuels “derived from sunlight, water and carbon dioxide”. However, the technology is still at an early stage and far from commercial maturity.
In the UK, scientists at the University of Sheffield last week said they were boosting green hydrogen production to be larger than any other UK facility; and added that it would help to support the rollout of more sustainable fuels in the aviation sector.
The university is using electrolysers from IMI Remosa to produce 140 normal cubic metres of green hydrogen per hour, which it would use to develop hydrogen-based fuels at its Sustainable Aviation Fuels Innovation Centre. Sheffield researchers are also working with Virgin Atlantic on technology for the first sustainable transatlantic flight, which is due to take off on 28th November 2023.
Mohammed Pourkashanian, director at the university’s Energy Institute, said it was vital “to understand more about the possibilities and capabilities of green hydrogen” if the world is to achieve a “decarbonised future”.
Scientists at Israel’s Tel Aviv University reported last month that they had been able to create green hydrogen at 90% efficiency without carbon dioxide emissions. They wrote in journal Carbon Energy that this was due to an enzyme called hydrogenase that is usually able to produce hydrogen from sunlight via photosynthesis.
The researchers said they had been able to attach this enzyme to an electrode by using a water-based gel, which means it can be activated by electricity to produce green hydrogen at high efficiency levels.
Oren Ben-Zvi, senior research associate at the university, said: “We hope that in the future, it will be possible to employ our method commercially, to lower the costs, and to make the switch towards using green hydrogen in industry, agriculture, and as a clean energy source.”
There is no guarantee that any of the innovations in this article will be commercially successful, and this can only provide a snapshot of innovative research work in this part of the green hydrogen sector. But these breakthroughs give us confidence that the technology still has plenty of scope to reduce costs and boost efficiency.
Councillors on the planning committee at Frome Town Council in Somerset in the UK have unanimously rejected Trina Solar’s planning application for a 30MW energy storage facility due to concerns about fire risk.
Chair of the planning committee, Cllr Steve Tanner, said the application had been rejected because there would be a “detrimental impact on the residential amenity” of local properties and the wider area. However he added that “despite assurances the committee was very concerned about the risk to public safety, not only the fire/thermal runaway but from the release of toxic gases both into the atmosphere or the nearby stream”.
However, Tanner said that the council acknowledged the need for battery storage in the town due to the fact that there is “not currently enough provision in the grid and that this is impacting new development as well as the supply to existing users”.
Californian energy storage company Rondo Energy has secured $60 million in new investment from a group of investors including Rio Tinto, Microsoft's Climate Innovation Fund, and Aramco Ventures.
Other participating investors included SABIC, Siam Cement Group, TITAN Cement Group, Breakthrough Energy Ventures, Energy Impact Partners, Sustainable Development Capital.
By leveraging materials like brick and iron wire, the Rondo Heat Battery “minimises safety, durability, cost, and supply chain risk”, the company says. Thousands of tons of bricks are heated directly by thermal radiation, and store energy for hours or days with very low loss - less than 1 per cent per day - the company claims.
Alinta Energy is to build a 100MW two-hour ‘big battery’ at its Wagerup Power Station to help stabilise and backup the grid in South West Western Australia.
Alinta has appointed Shanghai Electric Power Design Institute and Sunterra to deliver the battery by early 2025.
Works at the site, located around 120 kilometres south of Perth, will commence immediately.
Ken Woolley, Alinta Energy chief development officer, said: “This project is a great example of how Alinta Energy, Western Power, AEMO and our key supply partners are rapidly mobilising to ensure the electricity system in South West WA has the smoothest transition to renewables possible.”
Mainstream Renewable Power and Ocean Winds have grown the footprint of their Arven offshore wind project in Scottish waters to 2.3GW.
A 50:50 joint venture between the firms was named preferred bidder for a 1.8GW site to the east of the Shetland Islands in the ScotWind leasing process in August 2022. The pair have now agreed to add an adjacent site with the potential for up to 500MW of offshore wind capacity into their development plan.
The energy storage industry is at a crucial phase of its development, only those companies that effectively plan how to extend the lifetime of their technology will survive
The energy storage industry is entering a pivotal era when competition will intensify and some market players will fall by the wayside as the market leaders take a more strategic approach to the development of their business. Indeed, the best energy storage companies will have looked at ways of extending the longevity of their technologies even before they officially launched them. While this may be counterintuitive, professors at Harvard Business School concluded that considering life extension at the pre-introduction stage had three key benefits:
1. It generates an active rather than a reactive product policy
Considering product life extension “systematically structures” a company’s long-term marketing and product development efforts in advance, one professor at Harvard Business School argued, rather than each effort or activity being merely a “stop-gap response to the urgent pressures of repeated competitive thrusts and declining profits”. The argument is that the life-extension view of product policy enforces thinking and planning ahead, that is, thinking in a systematic way about the moves likely to be made by potential competitors and about potential changes in consumer reactions to the product. This school of thought can be seen as having particular relevance to the energy storage sector when you consider that towards the end of November 2022, US-based Energy Vault, which had long extolled the virtues of gravity and kinetic energy-based storage, performed a high profile pivot to the selling of conventional battery storage. This was viewed as the type of reactive product policy that Harvard Business School had warned against, though Energy Vault did not abandon gravity-based storage completely, but rather described the move as a “technology diversification across energy storage mediums”. In addition, the point about how customer reactions to a product can change is an especially pertinent one for the energy storage industry, particularly when you consider that while the vast majority of the public support the use of renewable energy, public opposition to the siting of energy storage systems in certain communities is a persistent problem, despite storage being a key component of the global energy transition.
2. It lays out a long-term plan designed to breathe new life into the product at the right time
Harvard Business School professor of marketing Theodore Levitt believes that many activities designed to increase sales and profits of existing products or materials are often undertaken “without regard to their relationship to each other or to timing – the optimum point of consumer readiness for such activities or the point of optimum competitive effectiveness.” Levitt argues that careful advance planning, long before the need for such activity arises, “can help assure that the timing, the care, and the efforts are appropriate to the situation”.
3. Arguably the most significant benefit of engaging in advance, pre-introduction planning for sales-extending activities later in the product’s life is that the practice forces a company to adopt a wider view of the nature of the product
For companies interested in continued growth and profits, successful new product strategy should be viewed as a “planned totality” that looks ahead over some years, Levitt says. New product strategy should try to forecast the likelihood, character, and timing of competitive and market events. Though Levitt acknowledges that prediction can be “hazardous and seldom very accurate”, he argues that it is far better than not trying to predict at all. His belief is that every product strategy and every business decision involves making a prediction about the future, about the market, and about competitors. “To be more systematically aware of the predictions one is making so that one acts on them in an offensive rather than a defensive or reactive fashion – this is the real virtue of preplanning for market stretching and product life extension,” he argues.
It’s vital that the energy storage sector now takes stock of its position on the ‘industry life cycle’. The industry life cycle refers to the evolution of an industry through four phases based on the characteristics of businesses commonly displayed at each phase. The four phases of an industry life cycle, according to the Investopedia website, are: introduction, growth, maturity, and decline. Broadly speaking industries are born when new products are developed, though there is significant uncertainty regarding market size, product specifications, and main competitors. In time, consolidation and failure whittle down an established industry as it grows, and the remaining competitors minimise expenses as growth slows and demand eventually wanes.
Introduction Phase
The introduction, or start-up, phase involves the development and early marketing of a new product or service. Innovators often create new businesses to facilitate production and proliferation of the new product. Information on products and industry participants is often scarce, so demand is generally unclear. Consumers of the goods and services need more information about them, while the new providers are still developing and refining the offering. The industry tends to be highly fragmented at this stage. Participants are often unprofitable because expenses are incurred to develop and market the offering while revenues are still low.
Growth Phase
Consumers in the new industry now understand the value of the new offering, and consequently demand grows rapidly. A handful of important players become apparent, and they compete to secure market share. Immediate profits are generally not a top priority as companies invest in research and development, or marketing. Business processes are refined, and geographical expansion is often a feature. Once the new product has demonstrated viability, larger companies in adjacent industries often enter the market through acquisitions or internal development.
Maturity Phase
The maturity phase starts with a ‘shakeout’ period, during which growth slows and focus shifts towards cost reduction, with market consolidation a feature. Some companies succeed in achieving economies of scale and this negatively impacts on the sustainability of smaller competitors. As maturity is achieved, barriers to entering the market become higher, and the competitive landscape crystalises. Market share, cash flow, and profitability become the key objectives of the surviving companies now that growth is relatively less important. Price competition becomes a significant factor as product differentiation declines with consolidation.
Decline Phase
The decline phase signifies the end of an industry's ability to support growth. Obsolescence can negatively impact demand and lead to declining revenues. Margin pressure becomes more common and this forces weaker competitors out of the industry. Further consolidation is common as participants look for synergies and gains from scale. Decline often signals the end of the viability of the incumbent business model, resulting in industry participants being pushed into adjacent markets. The decline phase can be delayed with major product improvements or repurposing, but the endgame is ultimately unavoidable.
The answer to this question, to a degree, depends on which part of the world we’re talking about. However, more broadly speaking, there is an element of consolidation – with some storage companies merging and making acquisitions – but there is still considerable fragmentation and there are a large number of companies, even some of the bigger players, that are unprofitable due to investments being made in research and development. Demand is certainly growing rapidly – with the energy storage market predicted to grow in value from $44.7 billion in 2023 to $87.2 billion by 2028 – but it’s not immediately obvious which companies are the dead certs to become market leaders. Given all these considerations, the energy storage industry can be said to be transitioning from the ‘Introduction Phase’ to the ‘Growth Phase’.
Yes, the industry is still in its relative infancy, but it is precisely for that reason that market players need to take steps now to secure the future of their business in what will be an increasingly competitive market. These steps include:
- Anticipating moves that could be made by competitors
- Anticipating possible changes in public sentiment towards your product (for example, determine how your offering compares to competitors’ products in terms of fire risk, or considering how ESG concerns could potentially impact on take-up of lithium-ion battery storage systems)
- Plan sales drives well in advance to ensure the timing is right and ensure such drives are given due consideration
- Take time to forecast the likelihood, character and timing of possible future market developments.
Energy storage companies that fail to take these steps will be the most vulnerable when the market turns, margins get tighter and weaker players fall by the wayside.
There are four key actions that could contribute to success in the battery energy storage market, according to McKinsey. They are:
Focus on underserved needs in the value chain
In a nascent industry such as energy storage, companies should consider other products and services that they could provide, “whether through organic moves or inorganic ones”. For example, could a system integrator do battery packaging in-house? Or co-develop a new cell chemistry with a battery manufacturer? Or perhaps a battery manufacturer could develop system-integration or service capabilities to appeal to a specific BESS segment, such as utilities?
Serious consideration should be given to software. Storage system value is expected to evolve from simple hardware into the software that controls and enhances the system, unlocking the opportunity to capture bigger customer segments and higher margins. Battery storage companies need to develop these capabilities early.
Make supply chains more resilient
Vital battery storage components (ranging from battery cells to semiconductors in inverters and control systems) are dependent on complex supply chains, which are vulnerable to shocks from a range of sources, such as raw material shortages and regulatory changes. Strategic partnerships, multi-sourcing, and local sourcing should all be considered when developing your supply chain strategy, but you should bear in mind potential technological developments. Along with battery storage components, a potential bottleneck is engineering, procurement, and construction (EPC) capability and capacity, especially in the context of front-of-the-meter applications. Developing strategic partnerships with major EPC players in preparation for major BESS installations is vital if battery storage projects are to be successful.
Concentrate on the most important features of the product
Ensure product specifications have a laser-focus on what customers actually care about. Creating a customer segment strategy that informs the product’s direction and vision will increase the odds that every feature matters to customers. This is vital because price competition will be ever-present in the battery storage sector. An effective product ‘roadmap’ will also enable your business to more easily develop a unique selling proposition. For example, integrating with existing customer infrastructure could eliminate barriers to entry for many customers.
Think big and move fast
Battery storage currently has a high profile and revenues are growing quickly, so now is not the time to adopt a conservative approach. Yes, there is still considerable fragmentation in the market, but some of the major players are beginning to build market share. This poses a challenge for smaller battery storage companies in particular, which may have started life as research projects and now possess valuable intellectual property. Now is the time for these companies to take some calculated risks in order to increase their prospects of gaining market share, rather than losing out to major players.
ABB and Northvolt have expanded an existing partnership to include battery recycling at the Revolt Ett battery recycling facility being established by Northvolt in Skellefteå, northern Sweden.
ABB will provide “process electrification” at the Revolt Ett facility, an ABB statement said.
Financial details of the deal were not disclosed.
Revolt Ett will ultimately process 125,000 tons of end-of-life batteries and battery production waste each year, making it the largest plant of its kind in the world, according to ABB. It will service Northvolt’s gigafactory on the same site, which brought one production block online in 2022 and will establish others to reach an annual production capacity of 60 GWh.
“Batteries are a critical technology within the energy transition,” said Emma Nehrenheim, chief environmental officer at Northvolt. “But with massive growth in battery demand it is critical that we secure solutions to recycle batteries and ensure reliable, sustainable supply of critical minerals. This new facility Revolt Ett will help us achieve both of these goals as we work towards our mission of building the world’s greenest battery.”
Staffan Södergård, business unit manager, battery manufacturing, process industries at ABB said: “This is ABB’s first order within the strategically important battery recycling segment. In conjunction with a trusted partner in Northvolt, this project offers us the opportunity to help our customers avoid carbon emissions, reuse material and protect critical supply chains.”
Canadian Solar’s wholly-owned subsidiary Recurrent Energy has secured a 20-year tolling agreement with Arizona Public Service Company (APS) for Papago Storage, a 1,200 MWh energy storage project under development in Maricopa County, Arizona.
Construction of Papago Storage is expected to begin in the third quarter of 2024 with commercial operation scheduled for the second quarter of 2025. Once operational, Papago Storage will be the “largest standalone energy storage project in Arizona”, Recurrent Energy said in a statement.
Recurrent Energy began developing Papago Storage in 2016. Following construction, Recurrent Energy will own and operate the asset. Once operational, the project will dispatch enough power for approximately 244,000 homes for four hours every day. Canadian Solar’s majority-owned subsidiary, e-STORAGE, will deliver its ‘SolBank’ battery energy storage system and provide full integration and commissioning services for Papago Storage.
Recurrent Energy has delivered 9 GW of solar and 3 GWh of battery storage power plants, which are now in operation across six continents. In 2022, Recurrent Energy brought 2GWh of energy storage online in the US.
Dr. Shawn Qu, chairman and CEO of Canadian Solar, said: “This landmark project will give Arizonans more renewable energy every day. Recurrent Energy is delighted that Arizona Public Service selected Papago Storage via its rigorous competitive procurement process to support its 1.3 million customers’ growing need for affordable and reliable energy storage, and we look forward to growing our partnerships with APS and other utilities that are adding record amounts of energy storage in their service areas.”
Canary Wharf Group recently signed a power purchase agreement with Brookfield to use wind power in its own operations. We consider how the wind and commercial property sectors could work more closely together.
“You can’t connect the dots looking forward. You can only connect them looking backward. So you have to trust that the dots will somehow connect in your future.”
In almost ten years at Tamarindo writing 'A Word About Wind', I have avoided quoting the late Apple founder Steve Jobs. Partly because his quotes used to be so ubiquitous on LinkedIn, and partly because they haven’t fitted the article. But today is the day, as a story emerged recently that gave me a dots-connecting moment.
In June, banking giant HSBC announced it is set to leave its 45-storey headquarters in London office district Canary Wharf in 2027. It plans to move to a smaller building in central London that will enable it to better cater for the higher proportion of staff that are working flexibly since the Covid-19 pandemic. The move will also help it to reduce its energy use as, like other firms, it is striving to move towards net zero.
This will also put pressure on landlord Canary Wharf Group to work out its plans for 8 Canada Square post-HSBC. Sustainability is likely to be one of its priorities, given that Canary Wharf revealed on 9th May that it has signed a 15-year power purchase agreement with Brookfield to use electricity from a 60MW wind farm in Scotland, for around 70% of its electricity needs. This deal is to supply electricity used by Canary Wharf Group in its own operations, not across the whole 150-acre office, retail and leisure estate, but it may lead to the increased use of green power in the area.
Now, about those dots. Before ‘A Word About Wind’, I spent five years writing for the commercial real estate magazine Property Week, including three focused on areas including sustainability. It has been interesting to see a well-known commercial landlord embracing wind, and consider how this evolves in the years ahead.
However, it also raises questions I have grappled with over the years. Why has the commercial property sector been so slow to embrace wind and other renewables in their estates? And how can wind companies tap into such a huge potential source of power demand? The United Nations says 40% of carbon emissions worldwide are from the real estate industry, and wind must have a role in helping to reduce that.
One reason I believe that commercial property owners have been slow to embrace wind power is that renewable energy simply hasn’t been a priority for most of them.
Energy is a small fraction of the overall cost of developing, building and running a commercial building, whether that is an office, shopping centre or leisure complex. That may have changed a little given recent power price rises but, for many years, there simply hasn’t been much interest in where the power for buildings has come from as long as the lights were on, or in moving to ‘green’ electricity sources.
When commercial landlords have sought to become ‘greener’, their focus has been on improving the building fabric to boost efficiency and reduce carbon emissions. It is a good step. The greenest power of all is the power that isn’t used, and it makes sense to improve buildings because most will be in operation for decades to come.
Let’s consider the Empire State Building in New York. In 2021, the building’s owner announced that the famous skyscraper was now 100% powered by wind, but it was a move that came at the end of a decade-long programme to improve the physical fabric of the building. This feels symbolic of the approach of the industry as a whole. Buying green energy has been less of a priority than improving energy efficiency.
But this may now be changing. Over the last five years, we have seen some of the biggest companies in the world signing power purchase agreements to use wind or solar power in their own offices and operations. If tenants start demanding that they want to use renewable energy in the buildings they occupy – and refuse to occupy buildings where this cannot be guaranteed – then landlords will have to provide it.
One of the key benefits when landlords and tenants sign a PPA directly with the owner of a wind or solar farm is that they are clear where the power is coming from.
Canary Wharf Group said its PPA is attractive because it can show it is supporting the addition of new renewables capacity to the UK power mix: the 60MW wind farm in Scotland is due to be commissioned in 2026. This provides a PR benefit because Canary Wharf can show that it is taking action on important climate issues.
Finally, I believe the lack of PPAs with commercial property companies is due to the fact that PPAs are a relatively new mechanism. Those of us in the wind sector may get excited about how much PPAs have expanded, but commercial property is still a relatively conservative sector with well-established asset management processes. It takes time for new approaches to emerge and they can be slow to proliferate.
This is why Canary Wharf’s PPA is exciting. It is a well-known name committing to use wind power and other renewables for its own operations, and in the portfolio it operates. Wind power attracts broader support across the UK political spectrum in 2023 than it did even ten years ago, and this will be reflected in business culture.
Shobi Khan, chief executive of Canary Wharf Group, explained that this would help it to achieve its commercial goals: “To be truly sustainable, companies need to help those up and down their value chain to lower their environmental impact as well as addressing their own emissions,” he said.
The space in 8 Canada Square may soon be vacant, but the opportunities for wind farm owners with commercial property landlords are only growing.
Rural and local communities across England will be able to bid for funding from a new £10 million UK government fund aimed at setting up local energy projects including small-scale wind farms, rooftop solar, and battery storage.
The funding from the Department for Energy Security and Net Zero will “help to kickstart projects including small-scale wind farms and rooftop solar partnerships, as well as battery storage, rural heat networks, electric vehicle charging points, and fuel poverty alleviation schemes - all proposed, designed and owned by local people,” a department statement said.
The so-called Community Energy Fund will open to applications in the early autumn, the department said.
Minister for Nuclear and Networks Andrew Bowie said: “Local communities are at the heart of our plans to boost our energy security and grow the economy. The Community Energy Fund for England will empower communities to do just that. With it, they’ll be able to drive forward innovative energy projects that will have a lasting positive impact, bringing costs down, building stronger communities, and securing clean energy for generations to come. Importantly, these energy projects could expand beyond local areas by attracting further investment from the private sector, in turn inspiring other communities to power their area with energy from England.”
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Mercia Power Response, a provider of flexible power response services to the UK grid, has signed an agreement with RheEnergise to explore the potential deployment of long-duration hydro-energy storage in the UK.
Mercia and RheEnergise will work together to “identify suitable sites” for ‘High-Density Hydro’ (HD Hydro) projects, a statement said.
“The two companies’ initial focus will be the feasibility of getting 100MW of HD Hydro in commercial operation by 2030 by utilising Mercia PR’s existing grid connections,” the statement added.
RheEnergise’s HD Hydro storage system, rather than using water, uses an environmentally benign fluid which is 2.5 times denser than water, and which can provide 2.5 times the power when compared to a conventional low-density hydro-power system. It means that HD Hydro can be deployed beneath the surface of hills rather than mountains.
Graham White, CEO at Mercia, said: “It is very exciting to explore how we can engage with RheEnergise's HD Hydro technology, applying our expertise in finding the right locations, developing sites, getting grid connections and operating within the capacity market. We see enormous potential for HD Hydro deployment as a future low-carbon alternative to our existing gas-powered assets.”
Stephen Crosher, chief executive of RheEnergise, said: “Mercia PR’s experience in flexible power response and its deep knowledge of the UK energy system will be hugely beneficial to the RheEnergise team. Our HD Hydro technology can provide medium and long duration energy storage, which is becoming increasingly important as the UK moves towards net zero and with a UK energy system that is increasingly reliant on intermittent renewables.”
The UK Government is continuing negotiations with 17 of the 20 green hydrogen projects it has shortlisted for support in its allocation round last month.
The country's Department for Energy Security & Net Zero is seeking to back projects with Hydrogen Production Business Model and Net Zero Hydrogen Fund capital expenditure support. The 17 projects where negotiations are ongoing have total capacity of 262MW, and winning bidders are due to be announced by the end of 2023.
The three projects that dropped out are a demonstration project led by ERM Dolphyn; Gigastack led by Ørsted and Phillips 66; and Quill 2 led by Inovyn ChlorVinyls.