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Boralex to build Oxford battery energy storage project in Ontario

Company recently reported 62% increase in net earnings in Q1

A battery storage container at one of Boralex's facilities. (Courtesy Boralex)
A battery storage container at one of Boralex's facilities. (Courtesy Boralex)

Canadian renewable energy developer Boralex Inc. (BLX-T) has been chosen by Ontario's Independent Electricity Systems Operator (IESO) to build the 125-megawatt, four-hour duration Oxford Battery Energy Storage project.

The Oxford project joins the 300-megawatt Hagersville and the 80-megawatt Tilbury projects in Ontario in the portfolio of Montreal-based Boralex.

The Township of South-West Oxford (just outside London) will be the site for the battery storage facility that is intended to provide greater flexibility, reliability and stability to the energy-hungry province's electric grid.

One of the principal reasons for the construction of the Oxford plant, expected to become operational by 2027/28, is the need for additional battery energy storage capacity in a province that seeks to increase the proportion of renewable energy sources in its overall energy mix.

The need for battery storage for renewable power

Given the inherent variability in wind and solar power generation due to weather conditions, it is necessary to store such energy and then deliver it to the power grid according to demand and supply conditions.

"In an energy environment where you have a large fleet of nuclear facilities and a growing fleet of wind and solar and there is a mandate to reduce substantially your gas consumption, you inevitably reach a point where additional storage is going to be required," Hugues Girardin, Boralex executive vice-president and general manager, North America, said in an interview with Sustainable Biz Canada.

"It's pretty obvious to us that the success of renewable energy like wind and solar, in a larger concentration, in the Ontario environment where you have to start with nuclear, was the first place that this was going to happen.

"In the case of wind power, it needs to be stored because in conditions when the wind is down, the energy grid is lacking this energy, and when the wind is high, you may have excess energy."

The additional capacity afforded by Boralex's Oxford facility will compensate for this by providing efficient storage of wind, solar and nuclear energy for optimal transmission to the grid as needed, particularly during peak stress hours.

"For us, in today's environment, where battery prices are decreasing almost on a monthly basis, it's pretty clear that battery energy storage is going to be a more popular product going forward . . . we believe very strongly in the storage market," Girardin added.

Boralex partners with Six Nations Indigenous community

The Oxford plant also marks another project where Boralex has made it a "key priority" to team up with a local Indigenous community. In the case of Oxford, the company has entered into a 50 per cent partnership with Six Nations of the Grand River Development Corporation.

Boralex and Six Nations previously entered into a 50-50 partnership on the 230-megawatt Niagara Region Wind Farm in Ontario's Niagara Peninsula, which was first commissioned in November 2016 and powers the equivalent of 76,000 homes per year.

In addition, Boralex announced in September 2023 it had secured $827 million in funding to begin construction of the 200-megawatt Apuiat wind farm on Quebec's North Shore in association with its Innu community partners.

Impressive earnings results pave way for Boralex expansion

The announcement of the Oxford project comes on the heels of a strong earnings report by Boralex, which reported a 62 per cent increase in net earnings in Q1.

These positive results are likely to find Boralex expanding its wind and battery storage plans to take advantage of favourable demand and the need of Ontario and Quebec to accelerate renewable energy production to meet sustainable targets. 

"Right now we're focusing on Ontario and Quebec, but we remain open to any jurisdiction in Canada that would have a long-term demand," Stéphane Milot, Boralex vice-president, investor relations, said.

"We've always been in Quebec, that's our home market . . . and we have a strong pipeline of projects there. But we also feel the same way about Ontario. Ontario will have important energy needs going forward and our forecasts show that Ontario will be a very interesting market for us for the long term." 

Boralex has plans to double in size every five years

Buoyed by the earnings growth largely driven by its wind power projects, Boralex is poised to expand both its wind and battery energy storage operations.

"We're going to be dedicating quite a lot of resources towards developing new projects," Girardin said. "We're going to be in wind, we're going to be in solar, but we need to make sure that we are diversified.

"Given our strong wind results, the temptation is important to invest more in wind. But it's also important for us to have the correct diversification and to make sure that our shareholders get some stable revenue going forward."

Girardin sees Boralex becoming an increasingly important part of Canada's renewable energy mix in the future.

"We're already part of the solution and we have important plans for future growth. We want to double (the size) of this company every five years, which, if you do the math, is faster than the expected growth in demand.

"Our plan is to provide different products - wind, solar, and battery energy storage capacity - and take a bigger chunk of the energy environment in Canada and occupy a larger space in a CAGR (compound annual growth rate) way. Looking at the long term, we want to achieve a two, three, four, five and ultimately six per cent share of this grid."

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