Corre Energy, a Dublin-listed energy storage developer for renewable power firms, said on Wednesday it plans to have 1.3 gigawatts (GW) of storage projects in construction by 2026 following the signing of a deal in Germany.
The company said in a trading update that it has reached commercial close on its key Zuidwending (ZW1) project in the Netherlands on schedule. This includes binding agreements for power companies to take stored energy, grid connections and relevant land use deals.
The ZW1 project, the first large-scale compressed air energy storage (CAES) facility to be constructed in Europe in almost 50 years, will allow for surplus energy to be converted into compressed air, stored in underground salt caverns. ZW1 will be capable of supplying up to 320MW of electricity to the grid for a period of up to 3½ days.
Corre’s 320MW Green Hydrogen Hub (GHH1) project in Denmark is on track for commercial close in the second half of the year, the company said.
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The company also confirmed that it had signed an option agreement on more than 500MW of projects in Germany, which are already in construction, and that it has identified targets for potential investment in North America that will benefit from stimulus programmes in the US and Canada.
“Together with our new projects in Germany and further planned sites, including in North America, we are now targeting to have 1.3GW of storage in construction by 2026,” said chief executive Keith McGrane. “As previously stated, to support growth plans we are considering a variety of funding options, including debt and strategic equity investment in the company itself or at project level, and this will now accelerate in [the second half of] 2023.”
For context, 1.3GW equates to almost a quarter of the Republic’s current peak energy demand.
Corre Energy has raised almost €9 million from a share placing in February and the commercial close on ZW1 will unlock as much as €4 million in equity previously committed by Italian private equity fund Fondo Italiano per L’Efficienza Energetica (FIEE) to the project.
The company’s target remains to achieve internal rates of return (IRR) on equity invested in the “mid-high teens” per cent, or to realise value at financial close of individual projects by selling down assets to third parties, it said.
