Mainstream Renewable Power and Hexicon's 50:50 joint venture Freja Offshore has submitted a planning application for a 2.5GW floating wind farm in Sweden.
The companies are developing the Mareld floating wind farm more than 40km off the west coast of the country's Orust municipality. The Swedish government and other public agencies will now consider the application.
AVANGRID, part of the Iberdrola Group, and the Navajo Tribal Utility Authority (NTUA), the largest multi-utility enterprise owned and operated by a Native American tribe, have signed a memorandum of understanding (MOU) to explore opportunities to develop up to 1 GW of wind, solar and battery storage projects within the Navajo Nation in the states of New Mexico and Arizona.
The two parties said in a statement that the partnership would enable them to “create new jobs, create economic development on the Navajo Nation, offset lost revenue on the Navajo Nation, and bring reliable, affordable, and renewable energy to power Navajo Nation businesses and residents”.
The statement added that, as part of this partnership, AVANGRID and NTUA will explore how the projects being considered could benefit from the Inflation Reduction Act. “The IRA opens a path to meaningful emissions reductions in Indian tribes through the development of projects that can help them transition to a cleaner energy economy,” the statement said.
Lithium-ion cells and energy storage systems manufacturer KORE Power will supply battery energy storage systems to Cordelio Power for the repowering of Cordelio’s 20 MW/44 MWh McHenry standalone storage facility in the US’ PJM Interconnection.
Repowering will increase the power, safety and flexibility of the facility, a statement said.
PJM Interconnection coordinates the movement of electricity through all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia.
Cordelio Power is an independent power producer that develops, owns and manages renewable power and battery storage facilities across North America. Cordelio’s development pipeline includes more than 18GW of clean energy projects.
The UK Government is considering changes to the country's Contracts for Difference regime to include 'non-price factors' in companies' bids for support.
Graham Stuart, minister of state for energy security and net zero, said today that major reform to the CfD regime could help drive further investment in UK renewable energy deployment and improve energy security.
The Government is seeking views on changes to CfDs that could include factors such as supply chain sustainability, addressing skills gaps and how projects support grid flexibility. CfDs have been used in the UK between 2015 and 2022.
Stuart said: "Our flagship Contracts for Difference scheme has been hugely successful in supporting British low-carbon electricity generation, while also driving down costs for the benefit of consumers. But we want to go further to ensure we maximise the scheme’s potential to improve energy security and ensure renewable energy developers can make the necessary investment in supply chains and innovation, which will ultimately make for a stronger sector and help our economy to grow."
The consultation runs until 22nd May 2023.
The Italian Government is set to replace utility Enel's longstanding CEO Francesco Starace with Flavio Cattaneo, who is currently executive vice president at rail operator Italo.
Starace has held the post since 2014 and is currently at the end of his third term as the company's CEO, but has also reportedly not found favour with the country's new government. The change is scheduled to be ratified by shareholders on 10th May.
Italy's Treasury has also confirmed Claudio Descalzi will serve a fourth term as CEO of Italian oil giant Eni.
The Virginia State Corporation Commission (SCC) has approved nearly two dozen new solar and energy storage projects.
Once in operation, the projects will generate more than 800MW of carbon-free electricity, enough to power about 200,000 Virginia homes at peak output.
The projects are expected to deliver more than $250 million in fuel savings for customers during their first ten years of operation, a statement said.
The SCC approval includes nine solar projects and one energy storage project –totalling nearly 500 MW – that will be owned and operated by Dominion Energy Virginia. Two of the projects – Kings Creek Solar and Ivy Landfill Solar – will be built on previously developed land. Ivy Landfill Solar will be the company's first solar project developed on a former landfill. The SCC also approved power purchase agreements (PPAs) with 13 solar and energy storage projects – totalling more than 300 MW – that are owned by independent developers.
Construction of the projects is projected to support “thousands of jobs” and more than $920 million in economic benefits across Virginia, the statement said.
US hydrogen electrolyser and fuel cell maker Plug Power is facing a class action lawsuit from shareholders who claim they were misled about its financial prospects.
The action follows allegations that the company misled investors over the strength of its order pipeline and its likely 2022 revenue figure in its second-quarter results presentation in August 2022, which led to investors reporting losses in March 2023.
We have approached Plug Power for comment.
Greenwood Sustainable Infrastructure (GSI), the North American renewable energy subsidiary of Libra Group, has acquired the solar and battery development portfolios of Saturn Power, including a 1.4GW pipeline of early to late-stage solar and energy storage projects in five US states and two Canadian provinces.
The acquired pipeline includes 72 solar projects, 90 per cent community solar projects, and six battery storage projects. GSI plans to direct $200 million of capital investment to bolster its North American operations, including building the acquired pipeline in the coming years.
The deal expands GSI’s footprint from seven to 12 US states, which will now include New York, Massachusetts, Vermont, Florida, Minnesota, Michigan, Colorado, Illinois, New Mexico, Pennsylvania, Virginia, and Washington, as well as Alberta and Saskatchewan in Canada.
Tech giant Google has signed power purchase agreements (PPAs) totalling 177MW to buy wind power in Belgium and the Netherlands.
The company has agreed a 10-year PPA totalling 153MW with Dutch utility Eneco for electricity from the Fryslân and Kroningswind wind farms in the Netherlands. It is set to use the power for its data centre in Eemshaven.
It has also signed a 12-year PPA with EDF's Belgian subsidiary Luminus for to buy around 45.8GWh annually from four onshore wind projects with headline capacity of 23.8MW. The deal is due to start in 2024 at the latest.
The UK Government has followed the announcement of its first Net Zero Hydrogen Fund winning projects by publishing more details about its hydrogen strategy. But it is blue hydrogen projects, not green, that have dominated so far.
The UK Government is looking to be a leader in low-carbon hydrogen production, and has committed to achieving 10GW of installed capacity by 2030. But what can investors read into the flurry of activity coming out of Whitehall?
On 11th April, the UK’s Department for Energy Security & Net Zero opened to bids from companies seeking support in the second allocation round for the £240m Net Zero Hydrogen Fund. Companies can bid for financial backing for projects that need support in their early development phase, or capital expenditure for construction.
This follows the announcement on 30th March of the winners in the first allocation round, where a total of £37.9m was deployed for 15 projects. The winners included Conrad Energy, Octopus Hydrogen, RWE and Statkraft. You can see the full list of winning projects in this debut allocation round here.
Also on 30th March, the UK announced the identities of 20 shortlisted bidders in the fund’s first bidding process for projects that use electrolytic hydrogen technology. These projects totalled 408MW hydrogen capacity, and the bidders must now submit more information as the UK Government seeks to back 250MW of them.
The winners of this allocation round are due to be revealed by the end of 2023, and companies in the running include Carlton Power, EDF, Octopus Renewables, RES Group and Scottish Power. You can see the full list here.
You would be forgiven if these different tenders are tying you in knots. Last week, the UK sought to clarify its approach by unveiling its Hydrogen Net Zero Roadmap. This sets an ambition where hydrogen could represent between 20% and 35% of the country's final energy consumption by 2050, focused on industry, power generation and transport.
This roadmap also gave further details of a flurry of hydrogen policy activity. It confirmed its timeline to design new business models for hydrogen in the UK by 2025; revealed its timeline to develop a Supply Chain Roadmap; and is looking at other mechanisms to boost investor certainty. But truly green hydrogen is a small part of the mix.
Research from energy consultancy Westwood Global Energy last month said there are 45 low-carbon hydrogen projects totalling 17GW being planned in the UK. Most of these are small green hydrogen schemes. However, blue hydrogen projects most of the headline capacity, as they total 14.3GW (or 84% of the planned capacity). The green hydrogen projects in Westwood’s analysis have headline capacity of just 2.6GW.
There are some obvious reasons for this, most notably the availability of natural gas to produce hydrogen and the head start enjoyed by blue hydrogen technology.
By contrast, green hydrogen projects are small. The largest currently being planned is the Gigstack scheme by Ørsted, Philipps 66, ITM Power and Element Energy that is set to use electricity from the 1.3GW Hornsea 2 offshore wind farm to create hydrogen. However, even the Gigastack project would start with a 5MW electrolyser in its demonstration phase, which would be expanded to 100MW in future.
There is a great opportunity for green hydrogen production in the UK powered by the electricity from offshore wind farms. With the amount of new offshore wind being planned in UK waters, this sidesteps any concerns that new green hydrogen facilities will use green electrons that would otherwise be used to power the electricity grid.
But let’s not ignore the biggest flaw in the UK Government’s green hydrogen plans: it still has a de facto ban in place on new onshore wind capacity in England, and this is a major impediment to the use of onshore wind to produce British green hydrogen. If this is not addressed, the nascent UK green hydrogen industry will always be at a disadvantage while fighting against gas-powered blue hydrogen projects.
There are other challenges too. The UK’s hydrogen strategy could face upheaval if we see more political change at national government level, although we can at least be confident that any Labour government would continue to focus on green energy.
Then there are the competing policies from the US and European Union, which could attract green hydrogen investors away from Brexit Britain; the lack of certainty on future backing for green hydrogen after the next Net Zero Hydrogen Fund allocation round; and the need for fast clarity on business models if developers and investors can take the final investment decisions needed to press ahead with their developments.
The ambition is good as far as low-carbon hydrogen goes, but there are clearly issues to be solved. For now, green hydrogen is struggling to keep pace with its dirtier rivals. If the UK Government wants the greenest hydrogen then it must fix these problems now.
The Australian Capital Territory Government in Canberra has entered into a “long-term partnership” with Macquarie’s Green Investment Group global specialist energy storage team, Eku Energy, to develop the next stage of the Big Canberra Battery with a large-scale battery storage facility in Williamsdale.
The 250MW, 500MWh battery energy storage system is expected to store enough renewable energy to power one-third of Canberra for two hours during peak demand periods.
The storage system will cost between $300 and $400 million to build and will be developed, built and operated by Eku Energy. Construction will start in late 2024 with completion expected in 2025.
Clearway Energy Group has closed $1 billion of financing for two utility-scale solar and storage projects located in Riverside County, California on US Bureau of Land Management (BLM) land.
The Victory Pass and Arica solar projects will generate 463 MW of combined clean energy capacity and 186 MW of battery storage, which is enough electricity to power roughly 132,000 homes annually.
The Victory Pass project is fully contracted with two community choice aggregators, Silicon Valley Clean Energy Authority (SVCE) and Central Coast Community Energy (3CE). Arica is fully contracted with three customers, including Clean Power Alliance (CPA) and Peninsula Clean Energy.
The $1 billion of construction loans and project letters of credit was provided by a bank consortium consisting of MUFG, Sumitomo Mitsui Banking Corporation (SMBC), Societe Generale, DNB, Siemens Financial Services, Inc., CoBank, HSBC and Wells Fargo.
Clearway has also “arranged committed tax equity and a long-term common equity partner” to invest in the project upon commercial operation, which is scheduled for later this year.
Battery storage systems for both projects will be supplied by Fluence,
Energy trader Axpo has signed an eight-year power purchase agreement (PPA) to supply chemicals group Borealis with electricity from a wind farm in Kröpuln, Finland.
The PPA is due to take effect in 2024, and follows a ten-year PPA announced between Axpo and Borealis in December 2022.
Tomas Sjöberg, managing director at Axpo Sverige, said: “By expanding our collaboration with Borealis for renewable power in the Nordic countries, we are glad to have found a forward-looking partner that we can support in reaching their sustainability goals."
Skyborn Renewables is seeking consent for a 3.9GW offshore wind farm in the Swedish section of the Gulf of Bothnia.
The company submitted a permit application for the giant Eystrasalt project yesterday. It is seeking to start construction on the project in the early 2030s and switch it on in the mid-2030s.
Co-location of renewables assets with storage was rarely considered in the era of subsidies, but it is about to become the norm as investors seek to maximise the value of assets
Given the numerous benefits of co-locating energy storage with solar or wind projects, it’s surprising that such schemes aren’t more common.
Co-location means power can be stored when the wind is not blowing or the sun is not shining. In addition, co-located projects present a price arbitrage opportunity – that is, power is bought during off-peak hours (when grid prices are cheapest), and then stored and used during peak hours (when grid electricity prices are highest).
Co-located projects can also provide grid services such as ‘dynamic containment’, that is, catching and containing any deviations in energy frequency that could be caused by the loss of a generator, for example. In addition, solar plus storage in particular is viewed as doing much to mitigate the risk of yield and profit compression (known as the ‘solar capture rate’), that is the continuous reduction in energy price when the sun is shining and more solar assets enter the market.
Other benefits of co-location include an increase in the return on investment from renewables projects by reducing the capital outlay required – that is, fewer wind turbines or solar panels are needed to generate the same revenue.
Meanwhile, capital and operational costs can also be reduced by sharing existing infrastructure, land and grid connections. Combining storage and generation assets also allows more effective utilisation of connected grid capacity. As a consequence, the savviest investment funds are taking the step of retrofitting storage to their existing renewables projects. For example, last year it emerged that Next Energy Solar Fund would be retrofitting its 11MW North Norfolk solar farm with a 6MW/12MWh battery system.
Given the multiple benefits of co-location, why aren’t more wind and solar projects linked with storage systems? A key reason is that subsidies for wind and solar projects artificially reduced the high cost of projects and meant that there was less incentive for project developers to do everything possible to optimise the value of projects.
Now policymakers are providing less by way of subsidy for renewable energy projects so there is a greater onus on project developers to find ways of making schemes more attractive to investors and an effective way of doing this is by co-locating wind and solar with storage. For example, data from the US Energy Information Administration shows that total renewable-related subsidies were about $15.5 billion for both FY 2010 and FY 2013, then dropped to $6.7 billion in FY 2016 (see graph below).
Indeed, even if project developers are not planning to co-locate storage with wind and solar projects at the outset, they are now being advised to ‘future-proof’ their project by ensuring leases, for example, allow for a battery facility in addition to the main generation facility. Developers are also being encouraged to structure planning applications in such a way that they cater for potential battery add-ons in the future as this will maximise the value of the asset.
Yet barriers to co-located wind and storage projects remain. While corporate power purchase agreements (PPAs) have been flagged as offering a potential route to market for co-located assets, there is concern that the greater flexibility offered by co-located assets will result in PPAs that involve much higher premiums – because the extra flexibility is priced in – and this could be off-putting for potential corporate customers.
One potential solution is the development of hybrid PPAs. There are concerns about negotiating a contract for a hybrid PPA will be more complicated than treating assets as standalone and setting up separate routes to market for each asset. However, the counterargument is that the ability of co-located sites to guarantee more output, and meet both peak and baseload energy requirements, will enable operators of co-located sites to get a better price for their energy output.
Yet, despite an element of uncertainty about the best way forward for co-located projects, they will be the norm in the future. The appeal to investors of such projects is beyond doubt – witness Intersect Power confirming the $3.1 billion financial close of one of the US’ largest ever solar-storage portfolios, which included the Oberon I and II projects in California, which total approximately 685 MWp of solar and around 1GWh of battery energy storage.
Meanwhile, earlier this year, Copenhagen Infrastructure Partners, on behalf of its Flagship Funds, entered into a partnership with Amberside Energy with a view to developing 2GW of solar and battery storage projects in the UK. Elsewhere, in January, NextEnergy Capital launched a new fund, NextPower V ESG (NPV ESG), which will invest in solar and energy storage assets in OECD [Organisation for Economic Co-operation and Development] countries. NPV ESG is targeting capital commitments of $1.5 billion with a $2 billion ceiling.
This is just the start. Co-located solar and storage, which has been dubbed by some market observers as the ‘power couple’, is set to take-off. DNV has predicted that, within a decade, around one-fifth of all PV will be installed alongside dedicated storage, and by 2050, this will have risen to 50 per cent of all PV. DNV says that, by mid-century, total installed global solar capacity will amount to 9.5TW, with a further 5TW of solar-storage capacity.
With renewable energy developers less able to rely on government subsidies to make projects viable, and with investors looking to ‘future-proof’ renewables, co-location will be a key consideration when seeking to maximise the value of wind and solar assets.
KGAL Investment Management has signed 15-year power purchase agreements to supply cement maker Lafarge with electricity from the Krasin and Rywald onshore wind farms in Poland. The two projects are set to supply Lafarge with around 230GWh of electricity annually.
Finnish utility Fortum has launched €200m arbitration proceedings in Sweden against Vestas in a dispute about the impact of Russian sanctions.
Vestas reported yesterday that Fortum has launched the arbitration proceedings in the International Chamber of Commerce in Sweden because it could not receive turbines for planned projects in Russia. Vestas said it had to terminate the orders to comply with European Union sanctions arising from Russia's invasion of Ukraine.
Henrik Andersen, president and CEO of Vestas, said: “We strongly believe the arbitration to be without merit, and we are astonished and dismayed a state-owned company from a fellow EU-country would openly question the sanctions against Russia and thereby the unity of EU countries.”
Fortum said it would "vigorously defence itself against false claims by former business partner Vestas that it flouted sanctions against Russia". It said the dispute is related to "sizeable advance payments" it made to Vestas for 50 wind turbines for projects that were not built.
Nora Steiner-Forsberg, general counsel at Fortum, said: “We are at a loss to understand why our long-standing business partner Vestas would suddenly question our adherence to EU sanctions in this case. There is absolutely no doubt about Fortum’s commitment to upholding and defending EU laws, EU sanctions, and ultimately EU unity."
Invinity Energy Systems plc has been awarded £11 million in funding by the UK government’s Department for Energy Security and Net Zero (DESNZ) to build what it describes as the “largest grid-scale battery ever manufactured in the UK”.
The Vanadium Flow Battery (VFB) Longer Duration Energy Asset Demonstrator project will involve a 30 MWh Invinity VFB system deployed at a key node on the National Grid.
The battery will be capable of delivering more than 7 MW of power on demand.
With a capacity equivalent to the daily energy use of more than 3,500 homes, this battery will be the largest ever to be manufactured in the UK. Approximately six times larger than Invinity’s battery system at the Energy Superhub Oxford, it will also be “one of the world’s largest flow batteries”, an Invinity statement said
“Furthermore, with the ability to deliver full power for a discharge duration of over 4 hours, it is expected to be the largest long duration battery asset connected to the UK grid,” the statement added.
Two other energy storage projects also received funding from DESNZ. They were:
Steel giant ArcelorMittal has picked Siemens Gamesa as turbine supplier for a 166MW wind project in Andhra Pradesh, India.
The 166MW Kurnool wind farm is part of a 989MW wind-solar hybrid complex that is being developed by AM Green Energy Private Limited, which is a joint venture between ArcelorMittal SA and ArcelorMittal Steel India Limited.
The power from the Kurnool wind farm is set to power an ArcelorMittal steel plant in Hazira in the Indian state Gujarat.
Clean energy company Masdar has acquired a 50 per cent stake in a combined solar and battery storage project in California from EDF Renewables North America.
The Big Beau project comprises a 128MWac photovoltaic (PV) solar plant and a 40 MW/160 MWh battery energy storage system.
It is one of eight operational renewables projects - with a combined capacity of 1.6GW - that Masdar and EDF Renewables are managing in partnership.
Australian miner Iron Road has picked Amp Energy to develop an up-to-5GW green hydrogen production facility at Cape Hardy Port Precinct in South Australia.
Carlyle portfolio company Amp Energy is developing three large green hydrogen projects in Australia with a combined 20GW of electrolyser capacity and the potential to produce 19million tonnes of green ammonia a year. The Cape Hardy project would include up to 5GW of electrolyser capacity over the next decade.
Enagás, Hive Energy and JCCM have announced plans to develop a €10bn green hydrogen production hub in Albacete, Spain.
The companies have entered into a collaboration agreement with the local government in Albacete to develop the project. Construction work could begin in 2025 with hydrogen production scheduled to start in 2027.
Californian not-for-profit electricity provider Clean Power Alliance (CPA) has entered a 15-year power purchase agreement with NextEra Energy Resources, LLC, for a 75MW long-duration standalone energy storage project.
The project is located at NextEra’s Desert Sands Energy Storage facility in Riverside County, California.
CPA will begin storing and discharging energy from the facility in June 2026. The project marks CPA’s first executed contract incorporating eight-hour storage capabilities.
CPA is an electricity provider for 30 cities across Los Angeles County and Ventura County.
The US state of Maryland can “cost-effectively” build more than 3.5GW of energy storage by 2033 , according to a report by the American Clean Power Association.
The report added that building more than 3GW of energy storage could save Maryland ratepayers as much as $100 million annually by 2033. It also said that
a Maryland “state energy mix” with more than 3GW of energy storage could reduce emissions by 93% over the next ten years, relative to today’s emissions.
For more information on the report, click here