CEP and Marubeni unveil plans for 1GW battery and 1.5GW of solar in Australia

A sizeable new renewables fund chaired by former NSW Premier Morris Iemma and numbering executives from Macquarie, AEMO and Tesla, has revealed billion-dollar plans to install 1.5GW of solar and a gigawatt of battery storage across commercial and industrial sites around Australia over five years.

CEP.Energy said this week that the first phase of the rollout would start relatively soon, on the assets of industrial developer and property owner Pelligra Group, which has a portfolio of several hundred properties, including the former Ford manufacturing sites in Victoria.

An agreement with Pelligra will see CEP.Energy lease a portion of the company’s millions of square metres of roof space and build and operate solar and storage systems, starting with a 400MW “virtual power plant.”

The Pelligra solar and battery VPP – presumably using Tesla batteries, if the appointment of ex-Tesla energy storage man Jan Muller is any hint (RE is awaiting confirmation on this) – will be managed and operated through a separate deal with retailer SmartestEnergy, a subsidiary of Japanese conglomerate Marubeni.

CEP.Energy says SmartestEnergy will manage the assets, optimise the value of the solar energy produced, and sell it back to Pelligra’s retail and commercial customers at a roughly 20 per cent discount on grid prices.

CEP.Energy has also entered into negotiations with several large companies for long-term corporate power purchase agreements, a statement says.

To fund all of this, CEP.Energy has launched a $1 billion capital raising, which it expects will attract the interest of institutional investors that are currently “light on renewables,” and who want to green up their portfolios.

According to the company’s CEO, ex-Macquarie Bank executive director Peter Wright, the capital raising is progressing well, putting CEP.Energy on track to get to work in Victoria as the state progresses out of lockdown – which should mean within the next two weeks.

“We’ve had a strong market response driven by the fact that many institutional investors are underweight in commercial clean energy investments,” Wright said.

Of SmartestEnergy, which AER records show was granted authorisation as an electricity retailer in May of this year, Wright said the company had a proven track record in the commercial and industrial energy space in the UK.

“They will use their experience and battery and solar technology to offer electricity at a materially lower cost,’’ Wright said.

SmartestEnergy CEO Robert Owens said the company was strongly committed to a future energy market focused on decarbonisation, decentralisation and digitisation.

“We share a vision with CEP.Energy of an intelligent system maximising the opportunities of solar and battery VPPs to the benefit of consumers and the wider market,” he said. “We look forward to growing the opportunity with them.”

As well as Iemma, Wright and Muller, the CEP.Energy team includes Marjorie Maydwell as the company’s head of embedded networks. Maydwell, originally from France, has worked in roles at EnergyAustralia, Ausgrid, TrueEnergy and Scentre Group.

RenewEconomy reached out to CEP.Energy for more information on the finance and technology behind the plans, but had not heard back in time for publication.