ReVolve Renewable Power Corp (TSX-V:REVV) has provided an update on the progress of its 3.2MWh (megawatt per hour) Battery Energy Storage System (BESS) project in Cancun, Mexico.
Installation works are expected to be completed over the coming weeks. This is the first BESS project that the company signed on August 29, 2022, under the company's new Revolve Renewable Business Solutions division.
In a statement, Eric Hickert, Revolve's head of Distributed Generation, said: "We are delighted with the progress of the project to date and look forward to completion of the installation works over the coming weeks."
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The 3.2MWh battery storage system is being installed at the site of a major hotel chain in Cancun, Mexico.
Revolve owns 100% of the project and has responsibility for the financing, installation and operation of the BESS system.
A 10-year Energy Services Agreement (ESA) has been signed between the company and the hotel operator for the provision of peak-saving and other energy-related services.
Under the ESA, Revolve will receive an annual fixed payment, in addition to sharing the energy savings delivered by the project over the 10-year contract period.
An Engineering Procurement Contract (EPC) has been signed with Quartux Mexico SA de CV, a highly experienced installer and operator of battery storage systems in Mexico, to deliver a turnkey solution for the installation and commissioning of the BESS system.
In addition to the EPC, a 10-year maintenance agreement has also been signed with Quartux for the day-to-day operation and optimization of the system, including all routine maintenance.
The project is expected to cost around US$1.8 million to install and commission, including all related financing and transaction costs.
Project update
Quartux has provided the company with an update on the installation works for the project as follows:
- Site enabling works have been completed at the hotel, including the installation of specialist metering equipment to facilitate the operation of the Project once fully commissioned;
- Manufacture of the BESS system has been substantially completed and shipment of the first BESS units has commenced. The initial units are expected to arrive on site in mid-February 2023 with the remaining scheduled for delivery in March 2023;
- Installation of the BESS system will commence before the end of February and is expected to be completed by the end of March 2023; and
- The project is forecast to be fully operational and generating revenue for Revolve shortly thereafter under the 10-year ESA.
Revolve said it financed this project through a combination of cash on hand and a secured loan of C$1.86 million from RE Royalties Ltd. Drawdown of the secured loan was based on certain project-related milestones. Given the project's progress, the company has now completed the second drawdown under this facility of around C$880,000.
Going forward, Revolve is targeting 5,000MW of utility-scale projects under development in the US and Mexico, and in parallel is rapidly growing its portfolio of revenue-generating DG (distributed generation) assets.
Revolve develops utility-scale wind, solar and battery storage projects in the US and Mexico with a portfolio of around 2,450MW under development.
The company has a second division, Revolve Renewable Business Solutions, which installs and operates sub-20MW "behind the meter" distributed generation (or DG) assets.
Revolve Renewable Business Solutions currently has an operating portfolio of 2.85MW with an additional 6.2MW under construction phase.
Contact the author at jon.hopkins@proactiveinvestors.com