Tesla lands 500MWh storage contract, renewable boom in Brazil, S. Africa

Bloomberg New Energy Finance

Gamesa, Spain’s biggest wind-turbine manufacturer plans to invest more than $25.7m to expand production capacity in Brazil. The Latin America nation’s wind market has boomed of late, supported by government incentives – through guaranteed power purchase agreements and power-contract auctions – to boost demand.

As noted in Bloomberg New Energy Finance’s Q2 2015 AMER Wind Market Outlook: “Latin America installed 1GW of new wind in Q1 2015, driven mainly by Brazil with 0.8GW.” The London-based research organisation expects new wind build in Latin America, “to surge to 6.4GW in 2015 from 4.7GW in 2014, due to Brazil, Mexico, Uruguay and Chile.”

Across the Atlantic, SunEdison was again successful in finding new opportunities in South Africa, winning bids in the country’s latest renewables auction. The leading US solar company won bids to build and operate 371MW of solar power in the African country, which is struggling to meet its growing power demand. Solar projects in South Africa now beat the cost of coal-fired generation, which coupled with their quick build time, make the prospect of generating energy from the sun attractive in the sun-blessed nation.

North of the equator, Siemens was selected as the preferred supplier for ScottishPower Renewables’ $3.1bn UK offshore wind farm. The utility has requested that Siemens deliver as many as 102 of its 7MW systems to the wind farm off Britain’s east coast – a deal which could amount to almost half the value of the total project cost. Keith Anderson, CEO of ScottishPower Renewables, said the project will be, “the most cost-effective offshore wind farm ever delivered.”

In the corporate sphere, Swedish home retailer Ikea upped its renewables spend last week, pledging to invest 500m euros on wind energy and 100m euros on solar power by 2020, in an effort to make a bold commitment to climate change.

Elsewhere in Scandinavia, Statkraft cancelled its $1.4bn investment in some of the Nordic region’s biggest wind-farm projects, due to the low power prices prevailing in the region which made the projects commercially unviable.

The promise of commercial-scale energy storage advanced this past week, with Advanced Microgrid Solutions’ agreeing to buy 500MWh of battery capacity from Tesla Motors. The California-based provider of energy-storage systems will use the purchase to develop 50MW of storage for Edison International, as well as a number of projects going forward. As discussed in our H1 2015 AMER Energy Storage Market Outlook: “Behind the meter storage for demand charge management at commercial and industrial buildings continues to grow,” due to the pressing operational issue of peak demand management for US utilities, with demand charges often in the region of 40-60% of building energy bills.

Indeed, Albemarle and FMC, two of the leading lithium producers, are considering new factories to meet an expected surge in demand for lithium-ion batteries. Louisiana-based Albemarle, is vying to become the lowest-cost producer of lithium batteries, by designing a plant to convert spodumene directly into lithium hydroxide.

In other US news, cellulosic ethanol producers are pushing the Environmental Protection Agency to limit the number of credits available to oil refiners who wish to buy their way out of the renewable fuel standard obligation to blend cellulosic ethanol into their products. As explored in Bloomberg New Energy Finance’s recent Analyst Reaction on the topic, corn ethanol and cellulosic biofuel producers have recently seen their markets cut below what the law previously mandated, while demand for biodiesel is expected to reach at least 2.1bn gallons in 2016 in the US.

Last but not least, seven of the world’s richest nations have united to stamp out fossil-fuel emissions by the end of the century, during a summit in Germany hosted by Chancellor Angela Merkel. The push to “decarbonise” looks likely to be led by carbon-capture and alternative technology, and nations should aim for emission cuts near 70 percent of 2010 levels by mid-century, according to a statement issued by the G-7 yesterday.

Originally published by Bloomberg New Energy Finance. Reproduced with permission.