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Blackstone’s Aypa Power secures California BESS agreement, Texas tax exemption

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Blackstone portfolio company Aypa Power has secured an energy storage service agreement (ESSA) with community electricity provider Ava Community Energy (Ava) covering energy arbitrage, resource adequacy (RA), and ancillary services from one of the developer’s standalone BESS assets located in the city of Irwindale in Los Angeles County, California.

At a regular Board of Directors meeting on 12 June 2024, Ava’s Director or Origination Scott Harding presented details of the agreement which was unanimously approved.

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Ava – formerly East Bay Community Energy (EBCE) – is a Californian not-for-profit Community Choice Aggregator (CCA) power provider that last week announced former COO Howard Chang would be taking the helm after inaugural CEO Nick Chaset’s imminent departure next month.

In a LinkedIn post a couple of weeks ago, Chaset revealed that he would be joining the Octopus Energy Group to increase growth in North America. Through its generation arm, Octopus Energy last week announced its first investment in the US renewables industry, acquiring two solar assets located in the PJM region from utility-scale solar and storage developer Vesper Energy.

London, UK-headquartered clean energy company Octopus Energy has set itself a target to invest US$2 billion in the US renewables industry by 2030.

Aypa’s 20-year energy storage service agreement with Ava

Under the terms of the approved 20-year ESSA, Aypa Power will provide Ava with 100MW/400MWh of energy arbitrage capability and RA from its wider standalone 400MW/1,600MWh San Gabriel Storage facility.

Ava selected the Aypa Power project as part of its joint long-term resource RFO which it launched in 2023 alongside San Jose Clean Energy (another not-for-profit electricity provider operated by the City of San Jose in California).

Aypa Power has yet to secure a CAISO interconnection agreement for the project but holds a request for the facility under the name Gabriel Storage (queue no. 2113) which is being processed as part of the California system operator’s cluster 14 process. Interconnection to the CAISO grid will be via Southern California Edison’s (SCE’s) Rio Hondo 230kV substation.

Ava’s portion of the Gabriel project is expected online by 1 June 2027.

Another 125MW/500MWh capacity from Gabriel Storage contracted to 3CE

Aypa Power has already secured an offtake agreement for its Gabriel project after it successfully negotiated an ESSA with another community-based electricity provider, Central Coast Community Energy (3CE), in March of this year.

The agreement gives 3CE the dispatch rights to a larger 125MW/500MWh portion of the Gabriel project along with RA benefits for a shorter 15-year period commencing June 1 2027. 

Aypa gets Texas tax abatements for US$47 million BESS investment

Elsewhere in the US, Aypa Power recently obtained tax abatements relating to the battery storage portion of its Stargazer Solar and BESS facility located in Fort Bend County, Texas.

The abatements, granted by Fort Bend County and Fort Bend County Drainage District under Section 312 of the Texas tax code, gives Aypa Power a partial property tax exemption for its proposed development for a period of ten years.

In order to qualify for the abatements, Aypa Power has agreed to make a US$46.8 million minimum capital investment in the project, commence construction on the project no later than 30 June 2025 and then bring the project online within two years of breaking ground. However, it can apply for a one year extension on either of these deadlines.

The developer has also agreed to issue annual payments in lieu of taxes to Fort Bend and the Drainage District of US$74,424 and US$2,164, respectively.

The Stargazer facility will pair a 100MW/200MWh BESS with a solar farm across 1000 acres of land located approximately 5 miles northeast of Damon in Fort Bend County. Aypa Power expects to commence construction on the facility in the second quarter of 2025 and bring the project online in the final quarter of 2026.

Apya Power holds an ERCOT interconnection queue position for the solar portion of the project (queue no. 25INR0555) and another which is associated with the BESS (queue no. 25INR0556).

Unlike other interconnection queues in North America that pair different technologies together, ERCOT accepts submissions for each individual technology.

Aypa developing more than 22GW of standalone and hybrid battery storage in North America

After Blackstone’s acquisition of NRStor C&I from Fengate Asset Management and Lake Bridge Capital in March 2020, it rebranded the former NRStor subsidiary as Aypa Power.

Since the rebrand, Aypa Power has extensively grown its development pipeline, claiming to now have over 22GW of utility-scale energy storage and hybrid renewable projects in development across North America which includes 33 projects in operation or under construction.

In November last year, the developer secured US$550 million debt and tax equity financing for 700MWh of BESS projects in California and Texas, further to US$320 million in corporate credit facilities it closed on at the beginning of 2023.

12 November 2024
San Diego, USA
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