Plus Power, a renewable energy firm based in the United States, has closed a loan arrangement for its Kapolei Energy Storage project in Hawaii. The said project has a capacity of 185 MW/565 MWh. The company has agreed to a $219 million credit facility with Hawaiian Electric, which includes $188 million in non-recourse construction debt and $31 million in letters of credit. CoBank and Silicon Valley Bank joined Mizuho Securities USA and KeyBanc in leading the financing.
On the island of Oahu, the Kapolei Energy Storage project will interface at a major Hawaiian Electric substation. The project will add capacity and shift low-cost renewable energy to peak demand periods, as well as provide 50 MW of fast-frequency response services. It would support the closure of Hawaii’s coal plant, reduce renewable energy curtailment, and enable for the purchase and integration of new renewable energy resources as part of the state’s transition to 100 per cent renewable energy generation.
In May 2021, the Hawai’i Public Utilities Commission approved the project. The proposal gained unanimous support from the local Neighborhood Board, as well as the City and County of Honolulu’s acceptance of its Conditional Use Permit-Minor. The project site is ideal for new energy infrastructure because it is located in I-2 (Industrial) zoning outside of the Tsunami Evacuation Zone.
REGlobal’s Views: Energy storage projects are becoming critical for island regions like Hawaii especially as they move to decarbonise their energy systems and integrate more renewable energy. These storage projects enable load shifting, peak load management and reduce renewable energy curtailment.