Arizona utility Salt River Project (SRP) has signed an agreement for full dispatch rights to a new 250MW/1,000MWh battery energy storage system (BESS) project.
SRP announced last week (18 July) that the contract has been signed for Signal Butte, a standalone BESS project in Mesa, Arizona, US, with developer Aypa Power.
The 4-hour duration lithium-ion (Li-ion) battery asset will be constructed in Mesa’s Elliot Road Technology Corridor, an industrial development hosting high-tech manufacturing and tech companies.
Tenants include Apple, Meta, Amazon, and others. Google is also due to set up some operations at the development. The city of Mesa has provided utilities infrastructure, speedy permitting processes, and a Foreign Trade Zone, with Salt River Project providing power to the industrial park.
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Aypa Power, formerly known as NRSTOR C&I before its acquisition by private equity giant Blackstone in 2020, took over the project from another developer, Eolian. The pair jointly bid Signal Butte into SRP’s 2023 all-source request for proposals (RFP).
Aypa Power, which bought the project during late-stage development from Eolian, will continue to own it, while utility SRP has full rights to control the dispatch of stored energy into its grid.
It marks Aypa’s first BESS project in Arizona. The company’s other major announced projects are in the US battery storage hotspot states of California and Texas, with two further projects in Indiana, one of which was purchased also from Eolian.
The project is due to go into commercial operation by mid-2026. Eolian CEO Aaron Zubaty commented last week that its location in Signal Butte was chosen strategically in 2018 due to the presence of a substation serving “multiple operating and under-construction data centres”.
“The continued growth of our economy now depends more than ever on deploying fast-responding and flexible resources in the right locations to provide critical instantaneous capacity, and battery energy storage projects like Signal Butte can be built at a speed that matches and enables continued rapid growth in electricity demand,” Zubaty said.
Arizona utilities adding BESS resources through RFPs
Meanwhile, SRP and the desert Southwest state’s other main electricity supplier, Arizona Public Service (APS), have signed a number of similar agreements for large-scale battery storage projects in recent months.
Earlier this month a tolling agreement between APS and developer Strata Clean Energy was announced for a 150MW/600MWh standalone BESS project, and in June SRP held a celebration event to officially ‘open’ two projects from Plus Power, adding a combined 340MW/1,360MWh of battery resources to the utility’s portfolio.
These projects have all earned their utility contracts through participation in utility RFPs. SRP is currently hosting its 2024 peak power all-source RFP (PDF), launched in April. Through it, the company wants to add 200MW of peak generation capacity by May 2026, and at least another 300MW the start of May 2027, as well as 500MW of new carbon-free energy resources.
In addition, SRP recently launched an RFP specifically for the procurement of long-duration energy storage (LDES) resources from non-lithium storage technologies for deployment in the early 2030s.
