Debt-Financed 100MW/400MWh Battery Project Serving California Non-Profit Energy Supplier

Luna Battery Storage, a 100MW/400MWh battery energy storage system (BESS) project in California which was the subject of a “landmark” debt finance deal, is now online and serving community choice aggregator Clean Power Alliance (CPA).
CPA has contracted for 100MW of flexible energy storage capacity for a 15-year term with AES Corporation, which owns the project and developed it through subsidiary sPower – which was later merged into the parent company, becoming AES Clean Energy.
CPA said last week that it is now receiving the clean energy capacity from the system in the City of Lancaster, Los Angeles County.
“This resource will capture renewable energy during the day when solar is plentiful and send clean energy back to the grid during periods of peak energy demand,” CPA VP of power supply Natasha Keefer said.
“The Luna Battery Storage Project is a critical resource and CPA is proud to bring it online in time to meet California’s grid reliability needs this summer.”
As regular readers of will note, California has been pushing to deploy battery storage as one of a number of tools to help the state integrate higher shares of renewable energy and secure stability of the electric grid as it does so, as legacy thermal generation comes off the system.
Grid and wholesale market operator CAISO has targeted cumulative deployments of 4GW in its service area – covering roughly 80% of the state’s electricity customers – by the end of summer 2022. That effort continues, although recent months have seen some slowdown in deployment.
California community choice aggregators (CCAs) like CPA have become prolific in procuring energy storage resources over the past couple of years, and Luna marks CPA’s third standalone battery storage project to date in the state.
One, Johanna Energy Storage System, in Santa Anna, Orange County, is a 20MW/80MWh BESS which came online in October 2021 through developer Hecate Energy’s joint venture (JV) with investor InfraRed Capital Partners, constructed by Mitsubishi Power and with inverter and power conversion equipment supplied by Ingeteam.
The other covers a portion of battery capacity at Edwards Sanborn, a project under construction in Kern County, by developer Terra-Gen and EPC partner Mortenson, which also went online in late 2021. When fully complete, with 760MW of solar PV and 2,445MWh of battery storage, Edwards Sanborn looks set to be one of the biggest, if not the biggest, solar-plus-storage projects in the world so far.
CPA is among many offtakers for that project and as with Luna Battery Storage, has signed a long-term contract for 100MW of battery storage from it. Meanwhile the group, which has about three million customers in California, has also contracted for renewable energy from various solar-plus-storage projects too. That includes EDF Renewables’ Desert Quartzite project, pairing 300MW of solar PV with 600MWh of batteries.
At Luna, global system integrator and battery storage solutions manufacturer Fluence supplied its Gridstack sixth generation BESS solution. AES is one of Fluence’s main shareholders.
Back in February 2021, SPower closed a US$152.4 million non-recourse debt finance deal for the project. At that time, was told by Frank Beckers, a partner at clean energy advisory and consulting firm Apricum that it was something of a “landmark deal,” which demonstrated “the ability to tap on sizeable Project Finance debt funding for a standalone utility-scale battery storage project,” thanks to long-term revenues having been secured through the Energy Storage Agreement with CPA.