Canadian Solar (CSIQ) to Supply 220 MWh DC Battery Storage
Canadian Solar Inc. CSIQ recently announced that its subsidiary CSI Solar Co. Ltd.'s division e-STORAGE will supply 220 Megawatt-hour Direct Current (MWh DC) of energy storage solutions to Epic Energy's standalone energy storage project in Mannum, South Australia.
The Mannum project, being developed by Canadian Solar’s subsidiary, Recurrent Energy, will commence in second-quarter 2024.
CSIQ’s Role in the Project
Per the terms of the deal, e-STORAGE will provide Engineering, Procurement, and Construction (EPC) agreement and a Long-Term Service Agreement (LTSA) for the aforementioned battery project.
e-STORAGE's proprietary SolBank's cutting-edge battery technology will be incorporated in the Mannum project, which will improve grid stability in the region. SolBank includes an active balancing Battery Management System and a Thermal Management System for the highest safety and performance.
Battery Storage Prospects in Australia
Realizing the need to reduce greenhouse gas emissions like many nations, Australia has also been rapidly expanding its renewable portfolio in recent times. Per the latest report by the International Energy Agency, Australia’s government has joined forces with 130 governments that are collectively targeting a reduction in methane emissions of at least 30% by 2030. Of late, energy storage has been playing a critical role in constructing a country’s sustainable renewable energy market.
Further, significant funding for building storage projects offered by Australia’s government, as well as competitive market design, has bolstered the energy storage market in this nation. To this end, per the Wood Mackenzie analysis published in July 2023, Australia leads the global market for battery energy storage systems, with the total pipeline of announced projects exceeding 40 gigawatts.
Wood Mackenzie expects a 28% increase in the country’s battery storage capacity from now until 2032. In light of such projections, we believe that the latest agreement comes as a great opportunity for Canadian Solar to reap the benefits of the expanding Australia’s energy storage market. In November 2023, e-STORAGE was selected by Copenhagen Infrastructure Partners to deliver 480 MWh DC of battery storage solutions to the Summerfield battery storage project in South Australia.
Peer Moves
Other solar players in the industry that are indulging in the expansion strategy to meet the growing demand of Australia’s energy storage market are as follows:
Maxeon Technologies MAXN: During third-quarter 2023, Maxeon began the sale of battery storage projects in Australia. In October 2023, the company showcased some of its new products at the All Energy 2023 event. These products included SunPower Reserve, the company's home energy storage system, available for purchase through authorized dealers and installers in Australia. It expects to bring to the market the three-phase version of the SunPower Reserve storage system in 2024.
MAXN boasts a long-term (three-to five-years) earnings growth rate of 39.7%. The Zacks Consensus Estimate for 2023 sales implies a rise of 7.2% from 2022’s reported figure.
JinkoSolar Holdings JKS: In November 2023, the company revealed that it has successfully supplied the renowned Australia-based distributor, Blue Sun Group, with 300+ MW of solar modules, complemented by an energy storage capacity of 2488.32 kilowatt-hours (kWh). JinkoSolar leads the way in developing liquid-cooled energy storage systems in the country’s market.
The Zacks Consensus Estimate for JKS’ 2023 sales implies a rise of 30.7% from 2022’s reported figure. The stock delivered an average earnings surprise of 102.66% in the last four quarters.
Enphase Energy ENPH: In September 2023, the company announced that it is witnessing an increased deployment of its Enphase Energy Systems, powered by the new IQ Battery 5P and IQ8 Microinverters, in Australia. In December 2023, Enphase expanded its distribution partnership with AC Solar Warehouse for the distribution of Enphase Energy System in the country.
ENPH’s long-term earnings growth rate is 18.3%. The stock delivered an average earnings surprise of 11.97% in the last four quarters.
Price Performance
Over the past three months, shares of CSIQ have gained 3.1% against the industry’s 5.1% decline.
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Zacks Rank
Canadian Solar currently has a Zacks Rank #5 (Strong Sell).
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