In a double-hit of Texas news, Ormat is commencing operations at its Lower Rio energy storage facility, and Engie is partnering with Prometheus Hyperscale to power data centres in the state.
Ormat begins operation of 120MWh Texas BESS
US renewable energy company Ormat Technologies has commenced commercial operations at its 60MW/120MWh Lower Rio energy storage facility battery energy storage system (BESS) project in Texas, US.
The BESS will provide energy and ancillary services under a seven-year tolling agreement.
The company signed the agreement with optimiser Equilibrium Energy, for Lower Rio and the 60MW/120MWh Bird Dog BESS in August 2024.
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Lower Rio and Bird Dog were Ormat’s first tolling deals in the Electric Reliability Council of Texas (ERCOT) market, and at the time, the company said those deals allowed it to proceed with construction of the 100MW/200MWh Lousia project.
Ormat recently signed a US$62 million hybrid tax equity partnership with Morgan Stanley Renewables to monetise the 40% Investment Tax Credit (ITC) available for the Lower Rio project and the 42MW solar Arrowleaf project in California.
The transaction generated about US$25 million in proceeds. Ormat says this helped move the company closer to its goal of monetising US$160 million of tax benefits this year.
News of the tax equity partnership came shortly after the company released its Q1 2025 financial results, with a 120% increase in energy storage segment revenues. Ormat’s main business area is geothermal energy, but it has diversified into other technologies, opening its energy storage division in 2020 and targeting rapid growth in the segment.
CEO of Ormat, Doron Blachar, said of tax credits when announcing the partnership with Morgan Stanley Renewables:
“This Hybrid Tax Equity partnership is the first of its kind for our Energy Storage portfolio and highlights the innovative efforts we are taking to optimise the projects’ economics and the company’s profitability to ensure that we have the funding we need to support our long-term growth, while simultaneously helping advance our explicit goal of monetising US$160 million of tax benefits this year.”
Blanchar remained confident of the company’s ability to monetise ITCs, stating, “By continuing to effectively monetise the benefits of ITCs for our growing energy storage project portfolio through 2026, we are strengthening our ability to further invest in our development pipeline and ensure that we remain well-positioned to support the growing demand for energy storage projects.”
Engie to provide BESS for data centre developer Prometheus
Utility and power firm Engie has entered into an agreement with data centre developer Prometheus Hyperscale to co-locate data centres at BESS facilities along Texas’ Interstate-35 (I-35) corridor.
Prometheus will deploy its “high-efficiency, liquid-cooled” data centre infrastructure alongside Engie’s renewable and battery storage assets. The first sites are expected to go live in 2026 with more locations planned for 2027 and beyond.
Prometheus will collaborate with on-site power generation provider Conduit to offer short-term bridging and backup solutions. This partnership will also allow tenants to offset project-related carbon emissions using what the company describes as “established market-based mechanisms.”
In May, Prometheus partnered with flow battery startup XL Batteries to deploy its organic long-duration energy storage (LDES) flow battery technology at data centres following XL’s commissioning of a 333kW demonstration-scale project.
In the same month, Energy-Storage.news Premium reported that residents of Fannin County, Texas raised concerns as Engie neared completion of a 300MW standalone BESS project.
Despite these prior challenges, Engie appears committed to working with Prometheus in the state, with David Carroll, Chief Renewables Officer and SVP, ENGIE North America, saying, “Our collaboration with Prometheus demonstrates our shared approach to finding innovative approaches to developing, building and operating projects that solve real-world challenges.”
