Calgary-based SWITCH Power Corp. has commissioned five battery energy storage system (BESS) projects in Ontario during the past nine months, after entering the market in late 2021.
The projects are located near client facilities in the Greater Toronto Area and have a combined capacity of 3,310 kilowatts. The individual systems range from 500 kilowatts to 980 kilowatts.
They are under long-term energy services agreements and were energized between July 2022 and March 2023.
“In the fall (of) 2021, we bought a portfolio of assets from Peak Power. They're sort of the darling of Ontario around sustainable energy, and we've known them for about five years,” Trevor White, SWITCH’s president and CEO, told SustainableBiz.
“As part of that process, we bought four operating assets and nine development projects. Five were ready to build and four are still outstanding, that would be deployed over the 2023 (to) 2024 period.”
SWITCH now has nine operating BESS projects in Ontario.
Founded in 2019, SWITCH is an independent power producer that develops, finances, builds, owns and operates sustainable power generation assets such as solar and wind.
SWITCH’s Ontario BESS projects
The BESS systems were supplied by Calgary based Eneon-ES. Peak Power is contracted to provide dispatch services and the energy optimization software platform, Peak Synergy, to capture adjustment savings and ancillary services revenue.
SWITCH’s subsidiary, SWITCH Power Ontario Battery Operations Corp., owns and operates the BESS projects.
The company put an estimated $6.8 million toward funding. Over $2.3 million was provided by Natural Resources Canada’s $1.56-billion Smart Renewables and Electrification Pathways program.
“The assets that we're looking to build this year are 6.5 megawatts and 5.1 megawatts, respectively. So combined, 11.6 megawatts. The ones we’re looking to build also have grid resiliency features,” White said. “So they're not just global adjustment, or ancillary service revenue streams, they're actually providing power, quality and reliability to the customers.”
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All of the projects, commissioned or otherwise, represent behind-the-meter units. In aggregate, White said the total portfolio is approximately 20.2 megawatts.
Most of the BESS projects have a 20-year asset life, but the energy service agreements range from 10 to 15 years.
While White would not specify the clients, he did state they are generally involved in industrial manufacturing or real estate.
“Generally, we have what we call an electricity-as-a-service model where we want to find a customer, we want to understand what challenges they're having and then we want to develop a bespoke power solution or project around that,” White said.
“In this case, they're behind-the-metre energy storage systems. But different from an EPC (engineering, procurement or construction) or an engineering firm, we want to deploy our own capital as an owner-operator.”
SWITCH and expansion
Beyond being a new market for expansion, White had two main reasons for entering Ontario.
“(A) semi-deregulated market, which allows more opportunity for developers to come in and provide energy solutions. I wouldn't say it's a mature market, in terms of the (Industrial Conservation Initiative) program, but the energy storage market has been around. There's a precedent for these types of projects, there's a market and a regulatory framework to support it,” he explained.
“And then in general, Ontario has an interesting market from a demand requirements, a capacity requirements, clean energy targets (perspective).”
He also said much of the demand in the province is commercial and industrial, which is a significant focus for SWITCH.
SWITCH is also active in the solar sector in Ontario. In September 2022, it acquired an operational rooftop solar project in Vaughan which totalled 428 kilowatts of direct current. White declined to offer any specific details, but identified the firm has “multiple megawatts” under exclusivity for acquisition.
Aside from Alberta and Ontario, the company is also active in Saskatchewan. Canada’s Arctic region is part of its ancillary market, where it has a solar storage project in development.
“We are following what's happening in Eastern Canada around some of the energy calls in Nova Scotia (and) for wind and storage in New Brunswick. We don't have a presence there but again, with our financing and our growth mandate, we'll start to look at other emerging markets. B.C. is one we'll look at from maybe an efficient perspective of operating assets,” White said.
“We have our pulse on the market. But I would say Alberta, Saskatchewan and Ontario are kind of the core markets.”