Swiss asset manager Capital Dynamics quickly compiled one of the most ambitious energy storage pipelines in the U.S.
The firm is teaming up with Tenaska to develop and operate nine battery projects totaling nearly 2 gigawatts and up to 7.8 gigawatt-hours of grid storage in California. They will target the coastal hubs of San Francisco, Los Angeles and San Diego to provide the dispatchable capacity that is sorely missing right now as the state struggles with days of critical electricity scarcity.
The portfolio joins Capital Dynamics’ earlier acquisition of the Eland solar-storage project, which 8Minute Solar Energy contracted to the Los Angeles Department of Water & Power. CapDyn also acquired Strata Solar’s 100-megawatt/400-megawatt-hour battery near Oxnard in June, Greentech Media has learned. That system is under construction, expected online in the first quarter of 2021.
“It’s obvious to us that the energy transition will require a combination of hybrid plants — solar-plus-storage, wind-plus-storage — as well as standalone storage,” said Benoit Allehaut, managing director for clean energy infrastructure at Capital Dynamics. But, he added, “there’s still plenty to be built before it starts to make a dent.”
California has shut down nuclear- and gas-fired capacity without building enough new firm capacity to meet demand after the sun goes down. Capital Dynamics’ investment thesis appears tailor-made to tackle the root causes of the grid drama unfolding this week.
The partners identified the densely populated coastal areas as places where emissions-free capacity would be most valuable. Those areas consume the most power but are losing local capacity as gas plants shut down. Permitting new gas plants has already become a challenge, and the state’s 2045 deadline to eliminate fossil fuels from power production limits the payback period for new gas projects.
Tenaska chose the greenfield locations based on substation capacity and value for resource adequacy at both the system level and the local level, Allehaut said.
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