(Montreal) Renewable energy producer Boralex is making a breakthrough in the energy storage market. The Quebec company won a call for tenders in Ontario for two battery storage facilities, for a total capacity of 380 megawatts (MW).
For the company, which wants to become “a major player” in storage, it’s “a victory”, according to the senior vice-president and general manager, North America, Hugues Girardin, in an interview on Wednesday.
“We already have a 1 MW project in France, which has been in service for a few years. […] This time, we are really talking about an important entry. A 380 MW project is relatively large. It’s going to be one of the big projects in North America. »
In the longer term, Boralex is targeting a portfolio of storage projects of 1,000 MW by 2030. “With these two projects, we are in line with our strategic plan, perhaps even a little ahead,” adds he.
The Quebec company is making this first Canadian breakthrough in Ontario. The province is developing the storage sector before Quebec, because nuclear energy, an important part of Ontario’s energy mix, does not offer the same flexibility as that provided by Hydro-Québec reservoirs.
“Quebec is probably able to wait before acquiring storage capacity, judge Mr. Girardin. I think we’re going to see that kind of need appear. There is probably a lag of a few years. »
Ontario could provide other outlets for Boralex. Ontario’s Independent Electricity System Operator (IESO) wants to obtain 2.5 gigawatt hours (GWh) of storage capacity by 2027. “Boralex may have other opportunities to propose projects”, believes analyst Rupert Merer of National Bank Financial.
Mr. Girardin replied that Boralex is working on other projects in these different markets, but he did not want to give more details.
Two projects
The IESO has retained Boralex for two projects in Hagersville and Tilbury, Ontario. Commissioning is scheduled for the end of 2025.
Both projects could result in spinoffs of between 50 cents and $1 per share, Merer estimates.
With this 380 MW, the Quebec company won all the proposals it submitted as part of a 780 MW round of calls for tenders. Alberta-based Capital Power won the other bids.
Boralex expects the project to require investments of between $700 million and $900 million. Both yards are expected to qualify for a 30% federal tax credit for clean energy generation, transmission and storage. “A priori, yes, says Mr. Girardin. You should still know that the final details have not yet been communicated. There is a good chance that this is the case. »
Costs and returns will be shared with its Aboriginal partners. Boralex is associated with the Six Nations of the Grand River for the Hagersville site and with the First Nation of Walpole Island for the Tilbury site.
Boralex shares lost 18 cents, or 0.46%, to $38.94 on the Toronto Stock Exchange in the morning.
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