Corre Energy has entered an exclusivity agreement to acquire a 280MW compressed air energy storage (CAES) project in the US, for its international portfolio.
The project in the West Texas region of ERCOT comprises three pre-constructed salt caverns and Corre is targeting financial investment decision (FID) in 2025.
The exclusivity agreement to acquire 100% of the project assets has been signed with Contour Energy, a Texas-based energy storage developer.
Contour Energy will provide an experienced on-the-ground team and work closely with Corre Energy to complete the project.
The Texas project is supported by a positive economic environment, including the Inflation Reduction Act and extended Investment Tax Credit offered by the US government, representing an attractive entry point into the US market for Corre Energy.
Confirmatory diligence and project finance arrangements for the Texas acquisition are now underway.
The transaction by Corre Energy US Development Company, the company’s North American subsidiary, is expected to close later this year.
The Texas project supports Corre Energy’s pathway towards 1.3GW of storage in construction by 2026 across the portfolio.
It follows an option agreement last month to secure four existing salt caverns totalling over 500MW in Germany, doubling Corre Energy’s European project portfolio.
The company recently announced a milestone with the commercial close of its 320MW ZW1 project in The Netherlands.
Corre Energy remains on track to achieve commercial close on its 320MW Danish project in H2 2023.
Corre Energy is in the process of securing investment with interest from a range of institutional investors to fund Corre Energy’s portfolio, targeted at project level.
The process is “well advanced” with advisers appointed to support the Company in selecting a preferred funding solution and partner(s).
The process is expected to be completed in or by Q4 2023 and further updates will be made in due course.