Energy Transition in Motion (Week of Aug. 9, 2024)

The U.S. Department of Energy’s Loan Programs Office (LPO) is offering up to $1.45 billion in financing support to South Korean conglomerate Hanwha Solutions’ Qcells, the company developing the U.S.’ largest solar supply chain facility in Georgia.

Located in Cartersville, the facility will manufacture all of the key parts needed for solar power production—ingots, wafers, cells and the finished solar panels—under one roof. Qcells finished construction of its module production line at the site earlier this year. The facility, expected to become fully operational in 2025, will expand its annual manufacturing capacity of ingots, wafers, cells and modules to 3.3 gigawatts (GW).

“The project will also help build the U.S. solar industry while reshoring production capacity for solar components that are largely produced in China and Southeast Asia, boosting domestic supply chain resilience, and helping lower costs for customers and communities across the United States,” the LPO said in a news release. “Projects like the one announced today will benefit from the Section 45 Advanced Manufacturing Production Tax Credit, also known as 45X, created by President Biden’s Inflation Reduction Act (IRA), which incentivizes domestic manufacturing at each step of the solar supply chain.”

The Cartersville plant will the largest ingot and wafer plant built in the U.S., according to the LPO.

News of the loan commitment for the facility came as solar power generation continues to climb in the U.S. The U.S. Department of Energy forecast solar power generation will reach 286 billion kilowatt-hours (kWh) in 2025, up from 163 billion kWh in 2023.

Qcells completed expansion of its Dalton, Georgia, facility in 2023. The expansion boosted the facility’s annual solar panel production capacity to 5.1 GW.

Together, the Dalton and Cartersville facilities will increase Hanwha Qcells’ total annual production capacity of modules to 8.4 GW, which the company said is enough to generate the electricity required to power 1.3 million U.S. households for one year.

Here’s a look at other renewable energy news this week.

Biogas

Clean Energy Fuels Starts Up RNG Facility in Minnesota

California-based Clean Energy Fuels has started producing renewable natural gas (RNG) from its facility in Minnesota, the company said Aug. 5, transforming cow manure into pipeline quality gas.

Located at the Ash Grove Dairy in Lake Benton, the facility is expected to supply up to 480,000 gasoline gallon equivalent of negative carbon-intensity RNG annually when at full capacity, according to a news release. The facility will process up to 60,000 gallons of manure daily, capturing methane and converting it into 165,000 MMBtu of RNG daily.

The $22 million project was financed through one of Clean Energy’s production joint ventures and developed by Dynamic Renewables. The dairy farm is home to more than 2,000 milking cows, according to the news release.

Ash Grove is Clean Energy’s fifth renewable natural gas facility to come online in the last nine months.

“It’s always rewarding to see our efforts come to fruition when we begin injecting. With the growing demand for RNG, and interest really starting to take off as fleets realize how effective and immediate they can fuel cleanly, the RNG produced at Ash Grove will directly help with reducing carbon emissions across the country,” said Clay Corbus, senior vice president at Clean Energy.

Energy storage

E3 Lithium Gears Up to Build Lithium Demonstration Facility

E3 Lithium said on Aug. 8 it plans to build a fully integrated lithium brine demonstration facility as it advances direct lithium extraction (DLE) technologies and targets commercial production.

The company is extracting lithium from the brines of Alberta, Canada’s, Leduc reservoir.

“E3 Lithium aims to be a direct supplier of products to the battery industry,” said E3 Lithium CEO Chris Doornbos. “The Demo Project is an important step towards progressing the Clearwater Project, providing samples to potential strategic partners and an overall advancement for lithium assets on a commercial scale in Alberta.”

The Clearwater project is located between Red Deer and Calgary in an area that has supported decades of oil and gas operations. The company has said it intends to utilize existing infrastructure to help extract lithium from oilfield brine through a closed-loop system of wells and pipelines.

The demo facility’s project follows a 2023 DLE pilot program that evaluated multiple DLE technologies, including E3’s own. The company’s objective is to unify necessary components onsite into a fully integrated process replicating a smaller-scale commercial system, E3 Lithium said.

Ørsted, Mission Clean Energy Form Energy Storage JV

Denmark-based Ørsted has partnered with Wafra-backed Mission Clean Energy plan to advance four battery energy storage projects with a combined capacity of 1 GW across the midwestern U.S.

The initiative marks Ørsted’s first standalone battery storage partnership in the U.S. and globally, the company said in an Aug. 8 news release.

“Continuing to invest in and build out storage solutions is critical for ensuring a resilient and reliable grid, and this partnership with Mission advances this important goal,” said James Giamarino, chief commercial officer for Ørsted.

Mission Clean Energy will lead development of the projects, while Ørsted will provide capital to secure and maintain interconnection queue positions for the four projects, according to a news release. Interconnection for the projects, which will be owned by Mission with an option for Ørsted to acquire an ownership stake, have been submitted in Mid-Continent Independent System Operator (MISO) Central and North.

Use of battery energy storage systems is expected to continue rising, alongside renewable energy, to improve the reliability of electricity grids in the U.S.

Earlier this year, the U.S. Energy Information Administration (EIA) forecasted battery storage capacity in the U.S. would set a record in this year. Battery storage capacity is expected to nearly double if companies’ plans to add 14.3 GW of battery storage to the existing 15.5 GW are fulfilled, the EIA said in February.

“The partnership with Ørsted marks a significant milestone for Mission Clean Energy,” said Mission Clean Energy CEO Max Bakker. “Ørsted is an ideal partner to complement our development capabilities with their balance sheet strength and sponsorship support. Our combined expertise and resources will accelerate these projects and deliver impactful clean energy solutions in the MISO region.”

Mission Clean Energy said it has a more than 11 GW pipeline of solar and energy storage projects across the U.S.

Ørsted is developing about 3 GW of offshore wind capacity. Its more than 5 GW of onshore clean energy assets in the U.S. include a 40-megawatt (MW) storage project at the Permian Solar Center in West Texas and a 300-MW storage project at Eleven Mile Solar Center in Arizona.

Solar

Microsoft, Pivot Energy Seal Solar Agreement

Microsoft and renewable energy provider Pivot Energy have agreed to develop up to 500 MW of community-scale solar energy projects in the U.S.

The first projects are expected to come online before the end of 2024, Pivot said in an Aug. 8 news release.

The five-year framework agreement will enable Pivot to develop about 150 solar projects in about 100 communities across 20 states, including Colorado, Maryland, Illinois, Delaware, Pennsylvania and Ohio, according to the release. As part of the agreement, Microsoft will purchase the projects’ renewable energy credits for a 20-year term.

“The agreement represents Pivot’s largest Renewable Energy Credit (REC) agreement and most significant community impact collaboration,” Pivot said. “This also marks Microsoft’s first major distributed generation portfolio and, by matching customer electricity usage with new renewable electricity generation, supports the company’s goal of reducing its Scope 3 emissions by more than half by 2030.”

AES Indiana Makes $1.1B Investment, Shifts from Coal

AES Corp. subsidiary AES Indiana on Aug. 8 said it plans to invest about $1.1 billion in Pike County, Indiana, as it adds more solar and shifts coal-powered generating stations to natural gas.

The company said the Pike County Battery Energy Storage System and the Petersburg Energy Center will add 250 MW of solar and 180 megawatt-hours (MWh) of battery storage to its portfolio. The project, scheduled to start operations by year-end 2025, is expected to be one of the largest in the Midcontinent Independent System Operator (MISO) area.

AES is also taking steps to convert its two remaining coal units at its Petersburg Generating Station to natural gas by the end of 2026.

“These investments demonstrate our continued commitment to Pike County and leading the energy transition here in Indiana in a way that maintains affordability and reliability for our customers,” said AES Indiana CEO Ken Zagzebski. “The economic growth across the state has been powered by our people at Petersburg for more than 50 years and will continue to play a significant role in Indiana’s economic future.”

Ebon Solar to Construct Manufacturing Plant in N.M.

Delaware-based Ebon Solar has selected New Mexico as the site of an estimated $942 million solar cell manufacturing facility it plans to build, according to an Aug. 7 news release.

Located in Albuquerque’s Mesa del Sol industrial development area, the planned 834,000-sq-ft facility is expected to bring more than 900 new jobs to central New Mexico.

“The choice of Albuquerque for our investment aligns with our commitment to sustainable innovation, and New Mexico offers abundant solar resources, favorable renewable energy policies, and a dedicated, skilled workforce,” said Ebon Solar CEO Judy Cai. “These factors enhance Ebon Solar’s capital investment and production capabilities and make the city of Albuquerque, Bernalillo County, and the state of New Mexico ideal partners as we integrate into the clean energy market.”

RWE, Steelmaker Salzgitter Reach Green Power Supply Agreement

German utility RWE’s trading arm and steelmaker Salzgitter have reached agreement on a sizeable long-term green electricity supply contract to help Salzgitter on its route to covering power demand with renewables by 2030.

RWE Supply & Trading (RWEST) will provide Salzgitter with 64 gigawatt hours (GWh) of power from Brandenburg-based solar park Boitzenburger Land for seven years from 2027, the companies said in a joint statement Aug. 6.

Salzgitter’s SALCOS conversion program to low-carbon technology seeks to enable its flat-steel business, its biggest unit, to gradually reduce CO₂ emissions in steel production by introducing green hydrogen from 2026.

Conventional steelmaking is one of the largest industrial contributors to CO₂ emissions, with its damaging effects on the climate.

SALCOS entails exchanging the traditional blast furnace iron ore route based on coal input with so-called direct reduction, using hydrogen derived from green electricity in an electrolyzer, as well as, separately, electric arc furnaces using steel scrap.

The 64 GWh delivery volume in the contract represents three days’ worth of power output from a big nuclear plant, or five years of output from one wind turbine.

“We are getting serious about green energy sources,” said Marco Hauer, head of energy procurement at Salzgitter Flachstahl. “By 2025, half of our electricity requirements will come from non-fossil sources, and by 2030 we want to be using 100% green electricity.”

The contract is a so-called power purchase agreement, arranged by RWEST as part of its energy solutions activities.

Boitzenburger Land, a 180-MW solar photovoltaic park, has been in operation since 2023 and is jointly owned by Solarenergie Boitzenburger Land, GP Joule Group and Mainova.

Financial details of the transaction were not disclosed.

Wind

Tokyo Gas to Buy Stake in Portugal’s Floating Offshore Wind Farm

Japan’s largest city gas provider Tokyo Gas said on Aug. 6 it will buy a 21.2% stake in the WindFloat Atlantic operational floating offshore wind power project in Portugal to gain operational and maintenance experience.

Floating offshore wind is at an early stage in Japan, but the country considers it as essential to its goal to become a major offshore wind power producer as part of decarbonization efforts.

The government has a goal of 10 GW of offshore wind projects, including bottom-fixed and floating, by 2030 and up to 45 GW by 2040.

The deal marks Tokyo Gas’ first direct investment in an overseas floating offshore farm.

WindFloat Atlantic operates small, 25-MW floating wind farms off the Atlantic coast, and is majority-owned by Ocean Winds, a joint venture between Portugal’s main utility EDP and French company Engie.

The project is the world’s first semi-submersible floating offshore wind farm and has been operational since 2020. It uses a floating foundation system developed by Principle Power, a U.S. technology startup in which Tokyo Gas bought a stake in 2020.

Tokyo Gas said the system is exceptionally stable and has a proven ability to operate under severe weather conditions.

“We aim to leverage the knowledge gained from the collaboration to work towards the commercialization of floating offshore wind farms in Japan,” Michiko Hirose, senior general manager at Tokyo Gas, told reporters.

Under the deal, Tokyo Gas will buy the WindFloat Atlantic stake from Ocean Winds and Principle Power. The transaction is expected to close by year-end, but terms were not disclosed.

Reuters contributed to this report.