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UK local authority to invest directly in its own 25MW battery system

Chinese manufacturer BYD will supply lithium batteries for the project. Image: BYD / Wattstor

South Somerset District Council, which oversees an area of about 400 square miles in the south west of England, is to become the latest local authority to build a large scale energy storage system, with plans for a 25MW battery.

The council, in partnership with locally-headquartered firm Opium Power, will directly invest in the one-hour duration battery facility as part of its commercial strategy. It hopes to use the project to generate income from National Grid’s ancillary services markets, which are currently undergoing an extensive redesign and overhaul process. 

The council is aiming for an internal rate of return (IRR) of around 14%, with a minimum return on investment after repaying the loan and interest at 7.5%.

South Somerset District Council leader Ric Pallister said: "This project is just what we want our commercial strategy to deliver. Our team has worked incredibly hard to secure an exciting investment which will not only help the environment, but also provide invaluable revenue to help protect and strengthen vital services for our communities."

Battery supplier already selected

It is hoped the project will be operational by the end of the year, with the council already selecting BYD as its battery supplier. Additional services are to be provided by power management and equipment firm MSF Technologies, aggregator Kiwi Power and independent connections provider (ICP) BSR Connect. The battery facility itself will be jointly owned by the council and Opium Power, which will also be the project manager.

Henry Hobhouse, South Somerset District Council's portfolio holder for property and income generation, said: "Here's a superb example of where our commercial strategy can take us - working with key partners to invest in green technology that will be of lasting national benefit.

While the council was unable to disclose the location of the battery for “site security reasons”, it is within 75 meters from a major grid substation and with an approved grid connection already in place, it will benefit from a major reduction in setup and development costs.

The project is the latest energy infrastructure investment to have come from a local authority following approval by Swindon Borough Council of a 50MW project being developed by its own subsidiary, Public Power Solutions, back in November.

Hobhouse explained that the council had turned to energy storage as it offered access to more income opportunities will also meeting its environmental objectives to enable greater use of green technology.

"As well as finding significant efficiency savings, the council is committed to protecting front line services and meeting its ambition to improve life in South Somerset. To achieve that aim we are being more commercial in our approach and making investments that will deliver valuable income. We also take our role in caring for the environment seriously. We are committed to doing all we can to promote the efficient use of energy resources,” he said.

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