The North American arm of Sweden’s Eolus Vind has secured financing and advanced the sales process for its 100MW/400MWh Pome standalone BESS facility located in San Diego County, California.
Details of the financing and sales process were revealed in Eolus’ quarterly financial report, covering the period 1 April 2024 to 30 June 2024. The report was filed 29 August as required by the Nasdaq Stockholm stock exchange – the home of the company’s Class B share listing.
The company decided it was going to sell the Pome project during the beginning of 2023, and announced in its Q2 2023 financial report that it had reached a financial investment decision on the project, as reported in Energy-Storage.News last July.
‘Project is fully financed until commissioning’
Eolus’ CEO, Per Witalisson, revealed in his opening message of the interim report that the Pome standalone BESS is now “fully financed until commissioning” after the company secured US$175 million in financing during the month of August from an unnamed US bank.
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Witalisson also revealed that Eolus had spent the second quarter of 2024 focusing on divestment of the Pome project, and that the company is expecting to sign a sales agreement “in the coming months”.
The company announced last year that it had secured an agreement with a “major battery supplier” for the Pome project, and revealed in its recent quarterly report that it expected delivery of the BESS containers to commence this month (September 2024). However, the battery supplier has still yet to be named.
California environmental review exemption
The proposed BESS facility is located on 13830-13790 Danielson Street in the City of Poway in San Diego County, California and was granted an exemption from a full environmental review under the California Environmental Quality Act (CEQA).
According to documents on the CEQA website, the project received this exemption due to the development falling under the “Light Industrial/Storage (LI/S)” designation as stipulated in the South Poway Specific Plan. These are a set of rules, guidelines and best practices created by the City of Poway used by regulators when considering new developments in the area.
The project will connect to the California grid via San Diego Gas & Electric’s (SDG&E’s) Pomerado 69kV Substation (CAISO queue number 1669).
Entire capacity fully committed with California CCA
Eolus revealed last year that it had signed an agreement for offtake from the Pome project with an undisclosed buyer. However, documents filed by Eolus with the Federal Energy Regulatory Commission (FERC) reveal this offtaker to be Sonoma Clean Power (SCP) – one of the 25 community choice aggregators in California.
Under the terms of the energy storage tolling agreement, SCP has the exclusive rights to Eolus’ Pome BESS project for a period of 10 years. This will commence once the project has been cleared for commercial operations which is expected to occur during the first quarter of next year.
Eolus’ develop and divest strategy for BESS projects
If Eolus is able to close on the sale of its Pome development, it will be the third project incorporating a BESS which the Swedish-headquartered company has developed and divested in the US.
The 100MW/400MWh Cald standalone BESS located in downtown Los Angeles was Eolus’ first sale of a US project incorporating storage, acquired by Blackstone portfolio company Aypa Power in December 2021. The project has a 12-year tolling agreement with California public utility San Diego Gas & Electric (SDG&E).
In October 2022, Eolus also sold its Centennial Flats solar and storage project located in La Paz County, Arizona for an estimated US$104 – US$190 million to Carlyle portfolio company Copia Power. The project comprises 500MW of solar co-located with 250MW of battery storage expected to come online in 2026.
2.7GW+ of global storage capacity
Despite reporting a net loss of SEK82 million (approx. US$7.98 million) during the first half of 2024, Witalisson remained optimistic about the company’s outlook. The CEO described the future of Eolus’ operating markets as looking “positive”, attributing this to cost levels normalising and falling interest rates.
Witalisson had a particularly positive stance on the US market, describing it as “perhaps the most exciting” and having “considerable potential”.
Globally, Eolus claims to have a total renewable energy portfolio surpassing 28GW, primarily in Sweden (46%) but also a growing amount in the US (21%), including 2.755GW of battery storage capacity worldwide.
Eolus is focused on developing standalone and co-located battery facilities but is “also looking into opportunities to incorporate hydrogen production into some [storage] projects”.
