A unit of the huge Australian bank Macquarie is investing in esVolta to help make the idea work.
The investment, whose size was undisclosed, will “support the continued North American expansion of esVolta and finance its portfolio of over 600 MWh (megawatt hours) of contracted energy storage projects, primarily in California, and an additional development pipeline of more than 2 GWh (gigawatt hours),” the companies said.
The Macquarie deal comes about a year after esVolta landed a nearly $140 million senior secured credit facility to finance a series of large utility projects.
SCE, PG&E Partners
CEO Randolph Mann said the business was started about four years ago “with the vision that energy storage was about to take its place as part of the core infrastructure for the electric utility sector.”
Mann’s company is a developer, owner and operator of utility-scale energy storage projects across North America.
“We’re seeing some dramatic growth in our company as we participate in that growing market,” according to Mann.
As he summarizes the projects: “It’s a battery that has the capability of buying energy from the electric grid, storing it for a period of time and then selling it back to the electric grid.”
“We’re being paid for those services. We’re being paid for buying and selling electricity at a profit,” according to Mann. He says esVolta has contracts with companies including Southern California Edison and Pacific Gas and Electric Co.
Large Capital Costs
The company doesn’t disclose revenue or the amount of capital the Macquarie unit is providing, but Mann says the company is involved in projects that will be worth “several hundred million dollars” in capital costs.
EsVolta says its projects provide essential services for electric utilities and large energy users including on-demand capacity, energy arbitrage and ancillary grid support services
The company now has under 20 employees and is in the process of hiring more. It was advertising for two open positions on its website as of Feb. 22.
“Our business is really developing energy storage projects, and then financing, constructing, building and operating them,” according to Mann. “We haven’t scratched the surface of the total amount of growth that we’ll see in the energy storage space in the utility sector.”
“A lot of our projects right now are at development stage, where we still have a little bit of work to do until they are fully ready to be constructed,” Mann says.
Hummingbird Project
He said esVolta has two projects in operation, two in construction, and another six or eight that have utility contracts signed and are in a late-stage development getting ready for start of construction over the next year.
Mann cites one key project, Hummingbird in San Jose. It is a little more than 100,000 square feet, “like a giant warehouse, the size of a football field.”
He says competitors include Key Capture Energy and LS Power, both of New York.
The firm says it is also supported by a long-term capital commitment from RBP Partners LLC, and a strategic procurement arrangement with Powin Energy Corp.
EsVolta said the investment from Macquarie’s Green Investment Group would initially take the form of a bridge loan but would convert to equity upon receipt of regulatory approvals, including the approval of the Committee on Foreign Investment in the United States and the Federal Energy Regulatory Commission.
