Over 700 MW of Energy Storage Projects Announced as Next Step in Canada’s Largest Energy Storage Procurement to Date
FOR IMMEDIATE RELEASE
16 May 2023
Today the Independent Electricity System Operator (IESO) announced seven new energy storage projects in Ontario for a total of 739 MW of capacity.
The announcement is part of the province’s ongoing procurement for 2500 MW of energy storage to support the decarbonization and electrification of Ontario’s grid, which was originally announced in October, 2022.
Electricity demand in Ontario is expected to grow substantially in the next two decades, due to economic development and the predicted shift of many fossil fuel-reliant industries to electricity as part of the ongoing efforts to decarbonize. Energy Storage can support decarbonization efforts, storing excess low-cost energy – often from renewable sources – for later use. Lesley Gallinger, President and CEO of the IESO stated the IESO “recognize(s) the vital role energy storage plays in the decarbonization effort and in ensuring a stable and reliable energy supply.”
“At Energy Storage Canada we’re excited to see the IESO’s announcement of more than 700 MW of energy storage projects as the next step in Canada’s largest energy storage procurement to date,” said Justin Rangooni, Executive Director, Energy Storage Canada. “Energy storage is a flexible and sustainable means of managing and operating Ontario’s grid in a safe, reliable, and efficiency manner as the province, and Canada more broadly, undergo the current energy transition. We’re pleased to see the province of Ontario leading the way and we look forward to seeing additional projects announced in the coming months.”
Key Facts:
The IESO predicts an increase in electricity demand in Ontario of two percent annually for the next twenty years. Adding Energy Storage assets to the province’s grid will allow Ontario to capitalize on its clean energy supply mix to store low-cost excess energy and inject it back into the grid when it needs it most. Energy storage is also a critical tool in providing flexibility and reliability to the system to ensure energy is available when ratepayers need it. The IESO expects Ontario will have at least 1217 MW of energy storage capacity active in the market by 2026.
The seven projects announced as part of the initial 739 MW are in different places throughout the province and range in size from 5 to 300 MW. Five of the seven projects have at least fifty per cent economic interest from Indigenous communities. These projects will serve as a complement to the Oneida Energy Storage Facility, a 250 MW energy storage project which recently reached its next phase of development.
A 2020 report commissioned by Energy Storage Canada, Unlocking Potential: An Economic Valuation of Energy Storage in Ontario, found that 1000 MW of energy storage in Ontario could provide as much as $2.7 billion in savings for Ontario electricity customers. These savings will help lower costs to Ontario electricity customers over the next decade, and with energy storage assets designed to operate for 20 years or more, could provide savings well beyond ten years.
Grid-scale BESS have experienced significant cost declines and performance improvements in recent years due to technological innovation and manufacturing scale. Not only can BESS balance supply with demand by storing electricity when it is generated for when it is needed, BESS can rapidly provide an array of services such as “frequency regulation” that are needed for the safe and reliable operation of the power system. Such services increase in value as conventional fossil fuel powered generation is replaced by variable renewable energy resources such as wind and solar.
A 2022 report commissioned by Energy Storage Canada, Energy Storage: A Key Pathway to Net Zero in Canada, found that energy storage will play a critical role in Canada’s path to net zero. The report identified the need for a minimum of 8 to 12 GW of installed capacity for Canada to reach its 2035 goal of a net zero electricity grid. While the recent milestones (listed below) position energy storage for potential growth, national installed capacity is less than a gigawatt, which leaves a substantial gap to close.
Major recent milestones for BESS project development in Canada include: a competitive procurement for 2,500 MW in Ontario; the capacity of projects in the queue to connect in Alberta exceeding 2,500 MW; the 250 MW Oneida Energy Storage project moving toward commercial operation in Ontario; and NB Power soliciting proposals for 50 MW of energy storage projects in New Brunswick. In addition to BESS projects, there are also many Long Duration Energy Storage (LDES) technology-based projects advancing in Canada such as compressed air, pumped hydro and other non-lithium ion battery chemistries.
About Energy Storage Canada: Energy Storage Canada is the only national voice for energy storage in Canada today. We focus exclusively on energy storage and represent the full value chain of energy storage opportunities in our own markets and internationally. Energy Storage Canada is your direct channel to influence, knowledge and critical industry insights. For further information visit: www.energystoragecanada.org.
For additional information:
Leone Benson King, Communications & Media Relations Lead, Energy Storage Canada,
(613) 818-3849, leone.benson.king@energystoragecanada.org