AES Corp (AES) to Build Energy Storage Projects for SDG&E
The AES Corporation’s AES subsidiary, AES Energy Storage, has won a contract from San Diego Gas and Electric (SDG&E), a utility unit of Sempra Energy SRE, to build two new energy storage projects, totaling 37.5 megawatts (“MW”), in San Diego County, CA.
The contract followed the California Public Utilities Commission’s (“CPUC”) approval of a proposal by SDG&E to build two energy storage projects. In May, the Southern California electric utilities were asked to speed up the installation of new energy storage alternatives by the CPUC to improve regional energy reliability and facilitate the addition of new renewable energy resources.
SDG&E has chosen Advancion 4, AES Corp.’s fourth-generation battery-based energy storage platform, which has been designed for swift operation. Advancion is a smart, reliable and cost competitive substitute to peaking power plants which helps improve existing electric infrastructure and improves penetration of clean energy resources.
The energy storage arrays are scheduled to be operational by the end of Jan 2017. Once operational, they will improve regional reliability and incorporate an increasing share of renewable energy. The SDG&E arrays are expected to provide 37.5 MW of power for four hours at a stretch and serve as a flexible resource with a capacity of 75 MW for the grid.
The arrays will be integrated at two substation facilities of SDG&E − 30 MW in Escondido and 7.5 MW in El Cajon. After completion, the Escondido array will be the leading battery-based energy storage operational project in the U.S. Both the arrays will comprise components from the finest Advancion certified suppliers, which include Samsung SDI’s batteries and Parker Hannifin’s power conversion systems.
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According to James P. Avery, SDG&E’s chief development officer, the batteries will maintain a reliable flow of energy to customers during times of urgent requirement. Being the country’s leading distributor of renewable resources, the company expects these batteries to efficiently incorporate the supply of clean energy in the power grid.
Since 2008, AES Corp. has been installing advanced battery-based energy storage on electric grids. Its recent installations were spread across the U.S., Northern Ireland and the Netherlands. AES Corp. is the most experienced energy storage provider in the world. It has over 3.0 million MW-hours of delivered service across 136 MW of energy storage projects in four countries. Additionally, it has 296 MW under construction or in late-stage development.
AES Corp. currently has a Zacks Rank #3 (Hold).
Stocks to Consider
A couple of better-ranked stocks in the utility space include Spark Energy, Inc. SPKE and Korean Electric Power Corp. KEP, both sporting a Zacks Rank #1 (Strong Buy).
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