ReVolve Renewable Power Corp (TSX-V:REVV) said the majority of installation and commissioning works have now been completed at its Battery Energy Storage System (BESS) project located in Cancun, Mexico, and it is expected to be fully operational and revenue-generating from May 1, 2023.
The 3.2MWh project, which is being installed at the site of a major hotel chain in Cancun, is the first BESS project signed under the company's new division, Revolve Renewable Business Solutions.
In a statement, Eric Hickert, Revole's head of Distributed Generation commented: "The Cancun BESS project is now moving into the final stages with full commissioning expected in the coming weeks. We continue to see increasing demand for similar projects across our target markets and remain confident of securing further new projects in the short term."
READ: Revolve Renewable Power updates on development of Vernal BESS and Primus Wind projects
Revolve is the 100% the owner 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 shaving and other energy related services.
Under the ESA agreement, 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 approximately US$1.8 million to install and commission including all related financing and transaction costs.
Quartux has now provided the company with an update on the installation works for the project, which is summarized as follows:
- Delivery of the entire BESS system to the project site has now been completed.
- Installation and commissioning of the first two BESS units representing circa 70% of the project have also been completed and both of these units are operational.
- Installation of the final BESS unit is due to commence this week and full commissioning is expected before the end of April 2023.
- Construction, installation and commissioning costs for the project remain in line with previous guidance.
Revolve has financed the project through a combination of cash on hand and a secured loan of C$1.86 million from RE Royalties Ltd. Given the progress on the project as outlined, the company has now completed the final drawdown under this facility of C$368,249.
Revolve was formed in 2012 to capitalize on the growing global demand for renewable power. The company develops utility-scale wind, solar and battery storage projects in the US and Mexico with a portfolio of approx. 2,350MW under development.
It has a second division, Revolve Renewable Business Solutions which installs and operates sub-20MW 'behind the meter' distributed generation (DG) assets. Revolve Renewable Business Solutions currently has an operating portfolio of 2.85MW with an additional 6.2MW under construction phase and 71.8MW under development.
To date, Revolve has developed and sold over 1,550MW of projects. 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 assets.
Contact the author at jon.hopkins@proactiveinvestors.com