The developers of the UK’s largest battery are aiming to take it up to 150MW. And they say they can go even bigger.
Penso Power, the originators of the 100MW Minety battery, are now in talks with potential offtakers for the 50MW extension.
The Minety project, backed by China Huaneng Group, is actually two 49.9MW adjacent schemes in Wiltshire. It is expected to enter operation in autumn. The extension, called Stone Hill, is “immediately adjacent to the projects, said Penso CEO Richard Thwaites, and is expected to come on stream in 2021.
He said the company has another 100MW project in planning that will be “investment ready within three months”, and a further 100MW scheme “a little further out”, both in the south of England.
Shell is the offtaker at Minety, with its Limejump subsidiary monetising the battery in merchant markets.
Thwaites, formerly chairman at Limejump, said offtake arrangements for the extension – and other upcoming projects – would likely follow a similar structure.
In the two years since founding Penso, he along with chairman John Wybrew and CFO Andrew McAleavey appear to have hit on a structure that gives investors sufficient confidence to back very big batteries.
Getting the next tranche over the line will underline its credentials.
“We need to meet the risk appetite of investors that will fund these projects. So there is a fixed element of the offtake structure that provides a guaranteed monthly income, with some upside beyond that,” said Thwaites. “So we can demonstrate to investors that they will hit a returns target with secure income, and there is scope to go beyond that.”
Thwaites did not disclose precise returns, but said they were double digit.
While the Minety project is billed as Europe’s largest battery, Thwaites said Penso “could go a lot larger”.
“It really comes down to the opportunities that are available and those we can find,” he said. “I don’t think the technology is a limiting factor in terms of size.”
Meanwhile, big batteries could partner with some interesting generation assets.
“We are looking at a range [of colocation projects],” said Thwaites. “The initial pipeline is standalone, but we are very open to colocation models as well.”