Gore Street secures ‘stackable’ Resource Adequacy contract for California BESS

The project was acquired by Gore Street Energy Storage Fund (which trades under the GSF ticker) in February last year and will come online in December 2024.

The RA contract is worth over US$14 million annually, will start in Summer 2025 and is fully ‘stackable’, meaning GSF can still combine it with other revenues from wholesale trading and ancillary services. Because RA requires a 4-hour duration, only 100MW of Big Rock’s power is being contracted.

It will account for 40% of the project’s revenue over its lifetime and will support raising project-level debt thanks to its guaranteed revenues.

The BESS will be provided by system integrator LS Energy Solutions, as announced a year ago.

RA, which is how load-bearing entities secure long-term capacity similar to a capacity market (CM), has been among the main drivers of the grid-scale BESS market in California, which is now at around 11.5GW of capacity. The programme requires the entities, including utilities, to show they have secured enough generation capacity via RA to cover their forecast peak demand, plus an additional reserve margin.

GSF’s expansion in the US comes during a prolonged downturn in revenues and valuations in the UK’s BESS market. The fund expanded abroad earlier than its peers, which has helped but not prevented it from having to cut its dividend for this year.