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Capital Dynamics Makes Multi-Gigawatt Bet on California Energy Storage
Expect to see a LOT more of these projects being initiated over the coming years.
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.
Interesting that Capital Dynamics plans to own these projects. Rather, than sell and take a small profit they are hoping to use batteries to make money on CAISO market - charge batteries when wholesales prices are cheap and discharge in early when prices rise.
Capital Dynamics will fund development and plans to own the projects after they come online in 2022 and 2023; Tenaska will have an opportunity to co-invest.
This comment is spot on...
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.
Note: the 8.2GWh of energy capacity mentioned in this article is equivalent to about 2.7% of the daily NG/coal generation in CA (CEC-2018). Thirty more projects like this and CA could timeshift solar to replace most of its NG generation.
Capital Dynamics Makes Multi-Gigawatt Bet on California Energy Storage
The infrastructure firm is working with Tenaska to develop and operate batteries near coastal population centers totaling nearly 2 gigawatts and up to 7.8 gigawatt-hours of grid storage in California.
Discussions
Nathan,
Thanks for the LBNL link - great resource.
I'm predicting the outcome based on the engineering, not simply extrapolating trends.
Really - do you mean "engineering economics"? Because I don't see how you can predict the outcome based on "engineering".
I'm saying that in only desert regions, you'll see substatial penetration of solar PV, and a substantial fraction of all night-time electricity supplied by batteries.
The current state of the CAISO grid does make storage a no-brainer. You can buy cheap and sell high - easy money. We will definitely see a flattening of the curve below and solar/storage will "eat" most of the NG generation on the grid.
You may see lots of MW of batteries going elsewhere, but especially in windy areas, they'll have sub-one-hour duration, as their main purpose will be to allow fossil fuel power plants time to throttle up/down when the wind/insolation changes.
I assume you are referring to TX here. ERCOT currently has a pretty flat pricing curve throught the day. Solar only has a small midday share of generation and any storage would have to compete with wind in early evening/night. So yes, early adopters of storage in TX will implement storage systems with short durations. These systems will be good for peak capacity and "playing the market" - trying to capture big price spikes.
That said, once solar reaches 20-30GW in TX - ERCOT's hourly pricing will start to look more like CAISO and storage durations of projects will increase. Economics not engineering.
Regarding US nuclear, agreed, no US new builds for a while (at least until the first SMRs break ground). We're napping while China and Russia dominate the export market
What export market? Are you talking about the one or two projects per year that China and Russia export? 1-2GW per year?
Here are recent China/Russia "wins".
- 2020 Turkey - AKKUYU-2
- 2019 Iran - BUSHEHR-2
- 2018 Turkey - AKKUYU-1
- 2018 Bangladesh - ROOPPUR-2
Curious - are you worried about the Chinese dominance of solar mfg?
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