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Calpine Corporation closes US$1 billion financing for 680MW California BESS

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Gas and geothermal plant developer and operator Calpine Corporation has closed a syndicated financing for what could be one of the largest battery energy storage system (BESS) projects in the US.

The credit facilities totalling over US$1 billion will finance the development and construction of a 680MW BESS project in Menifee, Riverside County, California, law firm and advisor to Calpine on the financing White & Case said this week (10 January). Few additional details have been provided by either firm but various public filings seen by Energy-Storage.news shed more light on the project.

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It will be built in five phases with construction already underway, Calpine announced in December 2023 calling the project the 680MW ‘Nova BESS’. When completed it will be one of the largest BESS in the US.

Various news sources including S&P Global previously reported that an energy storage facility called Nova would be built at the former site of Calpine’s 800MW Inland Empire legacy power plant, which closed in late 2022.

In May 2023, a Staff Report from the City of Menifee recommended approving the project, which it called the ‘Nova Power Bank Project’, and gave substantially more details on its specifics.

This includes the project’s plan to utilise existing infrastructure at the site including switchyard, control room, warehouse, storm water drainage system.

The plan is also to interconnect the project with the grid at a substation owned by Southern California Edison (SCE), one of the state’s main investor-owned utilities, using existing facilities at the decommissioned Inland plant adding. No additional transmission facilities would be needed and the interconnection capacity would be no higher than 680MW.

On use cases, it said the project would utilise battery storage technology (either lithium-ion, flow batteries or other technology) to store energy from the grid to be discharged when customer demand is high.

Then in June 2023, a document from the California Public Utilities Commission (CPUC) showed that SCE was in discussions to contract with the Nova BESS project for Resource Adequacy (RA). RA is the framework in the California electricity market (run by grid operator CAISO) for utilities to contract with energy assets such as BESS to provide capacity through long-term deals.

The proposed deal with Calpine’s ‘Nova IV’ BESS for 110MW of capacity – potentially giving an idea of the size of its first phase of construction – would start in September 2024 and last until August 2039.

The CPUC added that Nova IV and the other five it was seeking to contract with were all four-hour lithium-ion battery projects. Others in the list included Terra-Gen’s major solar-plus-storage project Edwards Sanborn.

A 4-hour duration for the Nova BESS at full 680MW power would mean an energy storage capacity of 2,720MWh, slightly smaller than the current largest BESS in the world, Vistra’s 750MW/3,000MWh Moss Landing BESS.

Calpine Corporation claims to be the US’ largest generator of electricity from natural gas and geothermal resources with 78 plants in operation nationwide and one operational 80MW BESS in California, while three BESS under construction include the Nova BESS as well as the 25MW West Ford Flat BESS and the 13MW Bear Canyon BESS, both located in The Geysers geothermal field of California.

California is the largest BESS market in the US and the world with over 7.3GW already online and is set to continue leading deployments this year along with ERCOT according to recent data from the Energy Information Administration (EIA).

Energy-Storage.news has asked Calpine Corporation additional comment and will update this article in due course.

Energy-Storage.news’ publisher Solar Media will host the 5th Energy Storage Summit USA, 19-20 March 2024 in Austin, Texas. Featuring a packed programme of panels, presentations and fireside chats from industry leaders focusing on accelerating the market for energy storage across the country. For more information, go to the website.

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