French independent power producer (IPP) Neoen has been awarded a 20-year capacity services contract for its 200MW/1,600MWh energy storage project in Ontario.
Ontario’s Independent Electricity System Operator (IESO) awarded Neoen with the contract for 190MW/1,520MWh of energy storage, as part of its Second Long-Term Request for Proposals (LT2), which is fulfilled by the 1,600MWh battery energy storage system (BESS) project.
It was earlier in June that the IESO announced the results of the LT2 procurement, securing 640MW of new capacity through three projects selected under the capacity stream. Though then it didn’t reveal the winning projects.
LT2 follows the IESO’s Long-Term 1 (LT1) competitive tender, which awarded over 850MW of BESS capacity contracts across two tranches in May and June 2023, representing Canada’s largest battery storage procurement to date.
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Announced in August 2024, LT2 aims to procure 3TWh of energy generation alongside 600MW of new capacity resources.
Neoen’s BESS will be located approximately 15 km west of the City of Dryden, in the District of Kenora in Northwestern Ontario. Construction is expected to begin in 2028, with a target in-service date of 2030.
The asset will be co-owned by Neoen and Eagle Lake First Nation in a 50% equity partnership. Neoen claims it will deliver significant economic benefits including jobs and local spending. This is also the first utility-scale renewable energy project for Eagle Lake First Nation.
In May 2024, Neon was awarded a 20-year capacity contract by the IESO for the 400MW/1,600MWh Tara BESS, as part of the LT1. It was among the top 10 projects selected and the second largest in terms of storage capacity.
At the beginning of last year, Neon initiated the permitting process for the Tara BESS, which it is developing with land development firm Shift Solar. Unlike the other nine BESS projects or its most recently awarded, which are being developed in partnership with First Nations developers, Tara BESS does not include indigenous involvement in its project ownership.
In May, the IESO launched its Long Lead-Time request for proposal (LLT RFP) to procure up to 800MW of long-duration energy storage (LDES). Shortly after, LDES developer-operator Hydrostor announced its intention to submit a compressed air storage project into the LLT RFP.
