A major battery storage project in Canada, said to be the country's largest, is advancing after the majority owner announced it has fully secured financing.
Toronto-based Northland Power Inc. leads a consortium that plans to build the 250-MW, 1,000-MWh Oneida Energy Storage site in Haldimand County, Ontario. The company, which owns 72% of the lithium-ion project, is partnering with NRStor Inc., Six Nations of the Grand River Development Corp. and Canada-based contractor Aecon Group Inc. to develop it. The firms estimate project cost at the equivalent of about $592 million.
Aecon, in addition to holding equity in the project, leads engineering, procurement and construction. The team has signed an agreement with Tesla Inc. to supply “Megapack” lithium-ion batteries for the project, according to NRStor.
Aecon says it plans to start construction this year. Oneida Energy Storage is expected to begin operating in 2025.
The facility will take surplus electricity from the Ontario grid during off-peak hours and return it during times of higher demand. The developers have a 20-year contract in place with the government-owned Independent Electricity System Operator in Toronto for most of its capacity, according to Northland.
Mike Crawley, company president and CEO, said in a statement that the facility “will play a key role in providing stability and reliability to energy grids.”
The Canada Infrastructure Bank, which has invested in Oneida Energy Storage, says the facility is expected to reduce greenhouse gas emissions by 4.1 million metric tons over 20 years.
The project’s financial close comes after Canadian government officials included a first-time renewable energy investment tax credit in their 2023 federal budget to include a 15% refundable tax credit for investments in stationary power storage systems that do not use fossil fuels.
Analysts from energy research firm Rystad Energy said in a statement that the tax credits stand to make Canada “a global leader in favorable financial conditions for green energy projects.” Rystad said the credits may help draw projects the way legislation such as the Inflation Reduction Act has in the U.S.
“Canada looked at its southern neighbor’s renewable tax breaks and the influx of investment it is set to trigger and thought: ‘I want some of that,’” Geoff Hebertson, Rystad’s senior renewables and power analyst, said in a website statement. “Its answer to the Inflation Reduction Act could have wide-ranging implications.”
In a statement, Northland says it is exploring how the tax credits may apply to the Oneida Energy Storage project.
Post a comment to this article
Report Abusive Comment