ABB Wants to Boost Storage & Microgrid Activity with a $113-Million Fund
ABB, a global technology company that specializes in power and automation, plans to boost energy storage and microgrid installations with a $113 million fund provided by Susi Partners, a clean energy infrastructure investment advisor.
Under an agreement between the two companies, ABB will provide its ABB Ability-based microgrid technology and battery energy storage systems. SUSI, a Swiss company, will finance the projects through its energy storage fund.
Either SUSI will own the assets or will partner with developers in the projects, said Markus Bruegmann, global product group manager for ABB’s Grid Edge Solutions, in an interview with Microgrid Knowledge.
ABB plans to focus on behind-the-meter and end-of-utility line applications in developed countries, including the U.S, Europe and Australia. The projects might include microgrids or storage that support mining operations, companies installing electric-vehicle charging infrastructure, and remote villages.
“SUSI already has renewable and solar funds, and sees a demand to support the battery storage microgrid application,”Bruegmann said. “Our goal is to develop new projects together.”
Financing renewable-rich microgrids
ABB believes a large number of developers and end customers are interested in using the funds. “We have just started discussion,” Bruegmann said.
In many cases, he said, microgrid customers lack financing, and this partnership aims to overcome that challenge.
“For example, take commercial and industrial customers, companies that want more renewable power. How do they finance the project and have a high penetration of renewables?” said Bruegmann. “This is the kind of challenge we are addressing. With our technology and the financing from SUSI, we will boost project implementation.”
ABB is steering away from the independent power producer (IPP) model because in some countries, regulators don’t allow for IPPs, he said.
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“In that kind of context, you can’t deploy these kinds of funds,” he said. However, in many countries, the partners can aim for higher penetration of renewable energy without violating any regulations if the projects are behind the meter, Bruegmann said.
ABB sees more opportunities for behind-the-meter storage and microgrids.
“These funds we believe we can deploy easier for commercial and industrial customers,” he said.
The companies aren’t focusing on residential applications of storage and microgrids, but are open to projects that aggregate residential energy storage. For example, if a small village wanted to become greener by aggregating numerous resources from residential customers, ABB would be open to such projects.
“For example, in Europe, more villages and counties want to become 100 percent green. If one of these villages would approach us to make it happen by making use of these funds, we would look into it,” he said.
Remote mining operations are also a possible market, he said.
“You have many mines in remote areas, say Australia and South America, where the mines are not grid connected; they operate diesel generation, which is very expensive to transport from a harbor to a site,” said Bruegmann. In these instances, ABB could install a system that uses solar, storage and diesel. The operators would only use diesel as a backup, he noted. ABB has delivered several projects to mining operations, he noted.
EVs, energy storage and microgrids
Another market is companies that plan on installing EV charging infrastructure, Bruegmann said. This includes car dealerships. With solar and storage, the dealerships could create a business model that reduces their costs, serves customers who need charging, and generates additional revenues. Generally, a third party would operate the system, possible providing peak shaving and other services to the grid.
“If the car dealer has a small engineering team, it could do this using ABB software,” he said. “With the software, everything would be in place so the end customers would also be the operator.”
ABB sees its microgrid offering as a way to meet today’s challenge of integrating high penetrations of renewables into the energy supply and ensuring reliable power. The company sees opportunity in serving commercial and industrial sites looking for alternative ways to optimize costs and minimize carbon emissions.
ABB now has more than 40 microgrid installations globally. They serve remote communities, islands, utilities and industrial campuses. SUSI has completed more than 60 transactions in sustainable energy infrastructure.
“The aim of this partnership is to support and finance the energy transition,” said Bruegmann.
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