GIGA STORAGE SAVES ENERGY WITH ENORMOUS STORAGE SYSTEMS
When can we definitively leave the era of fossil fuels behind and transition to green energy? The answer might come from GIGA Storage, a young company developing gigantic batteries for the storage of energy generated by solar and wind sources. Despite the exciting challenges and complex procedures involved in this form of energy storage, CEO Ruud Nijs firmly believes in his energy storage business. “Our ultimate goal is to finally be able to shut down coal and gas power plants.”
MORE AVAILABLE GREEN ENERGY & THE BEGINNING OF THE END OF FOSSIL FUELS
That the transition to renewable, ‘clean’ energy is one of the priorities of the present time should come as no surprise. Solar fields and wind parks are being established continuously to provide us with sustainable electricity. However, there is one problem: storage. Energy generated by elements like the sun and wind naturally has a variable nature. At one moment, gusts of wind and sun rays produce significant amounts of energy, while during thick cloud cover and little wind, the harvest is meager. Moreover, the demand for energy does not correlate with the weather. Hence, it is essential to store the generated energy as well. The more storage capacity we have, the more we can rely on this renewable source.
THE CHALLENGES OF ENERGY STORAGE
Unfortunately, the market for energy storage in the Netherlands is still in its infancy. The business case for storage systems is complex, permitting procedures are slow, and a considerable amount of money is required to make it all happen. For instance, installing a 48-megawatt-hour (MWh) battery can easily cost 25 million euros, as it requires as much as 6,250 kilograms of the metal lithium. But that’s not the only issue: the extraction of this raw material is problematic for multiple reasons. The demand for it has exploded in recent years, and lithium often comes from poor or politically unstable countries where human rights and the environment are under significant pressure. The EU is now working on ethically responsible extraction of this resource and experimenting with other materials. However, until then, the early-stage circumstances in an unpredictable market make it challenging to make large investments in the short term, even though the energy transition demands it.
NINE THOUSAND HOUSEHOLDS IN ONE ENERGY STORAGE SYSTEM
Still, GIGA Storage remains optimistic about the future of battery storage. This can be seen in the ambitious mission statement displayed on their website: ‘Clearing the path to shut down coal and gas power plants with giga-batteries.’ To achieve this ultimate goal, the company is currently investing in projects aimed at optimizing energy supply and grid stability. Meanwhile, they are forming partnerships with Eneco, Rabobank, and the Triodos Energy Transition Europe Fund as financial sponsors.
“OUR AMBITION IS TO BECOME EUROPE’S LARGEST SUSTAINABLE ELECTRICITY STORAGE COMPANY”
In October of last year, GIGA Storage completed the construction of the largest battery in the Netherlands: the GIGA Buffalo, an energy storage system with a capacity of 25 megawatts (MW) and 48 megawatt-hours (MWh). The amount of energy that can be stored in this battery annually is comparable to the annual energy consumption of over nine thousand households. This, in turn, can lead to saving up to twenty-three thousand tons of CO2 emissions per year.
EUROPE’S LARGEST SUSTAINABLE ELECTRICITY STORAGE COMPANY
For the construction of this breathtaking energy project, Rabobank provided the majority of the loan, alongside an investment from the Triodos Energy Transition Europe Fund. Incidentally, this is the first battery that Rabo finances in its own country – in 2019, the Project Finance division already financed a battery in the USA. Currently, the bank has financed over 3 GW of battery capacity worldwide: six in the USA, seven in Europe, and one in Asia.
“Our ambition is to become Europe’s largest sustainable electricity storage company,” says Nijs. “With the support of Rabobank and others, we are now able to take this big step towards even larger energy storage. Some future batteries will be even bigger and can be leased to multiple parties simultaneously.”
A BATTERY OF SMART MINDS
Last year, Rabobank took a minority stake in GIGA Storage through its investment arm, Rabo Investments. This makes Rabobank the first formal investor at the shareholder table. However, Rabobank also emphasizes its role as a “financial advisor”. The in-depth knowledge of colleagues from RaboResearch, who recently published a study on the business model for batteries, proved valuable in shaping a sustainable business model.
The same applies to Rabobank’s network. For example, the bank is the house banker of Elestor, a young company in Arnhem focused on developing a new battery technology with significantly lower emissions. Nijs has already indicated that he is eager to switch to construction using the most responsible materials once that new technology becomes available and affordable.
“We have chosen a growth investment in GIGA Storage because we believe that flexible storage is crucial for the energy transition,” says Malaya van Ruitenbeek from Rabo Investments. “The GIGA Storage team has proven its ability to attract the right partners and employees, enabling the company to be effective not only as a project developer but also to create attractive business cases in a young market. As co-shareholder, we focus on financing the ambitious project pipeline and ensuring the company’s rapid growth is manageable so that it can become a successful player in the large-scale energy storage sector in both the short and long term.”
Bronvermelding: rabobank.nl/over-ons/impact/article/011375807/giga-storage-spaart-energie-met-reusachtige-opslagsystemen