Energy storage investment in APAC Energy Storage Strategy Paper

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1 Energy storage investment in APAC Energy Storage Strategy Paper Future energy and finance 2017 Presentation Date or name of Presentation team

2 About Camborne Capital Camborne Capital Group privately owned parent company to Camborne Energy Storage Ltd and Camborne Land Investments Ltd. UK Solar PV experience 200MW financed through to commissioning. Energy Storage developing upwards of 400MW of assets in the UK, looking for increased APAC exposure and development in Land Investments focussed on sustainable rental sector investment of > 500m. 2

3 Growth of Renewable Energy Generation (UK) The UK has ambitious targets to meet 15% of its energy needs through renewable energy generation by By the end of 2016, there was over 30GW of installed renewable energy generation in operation. Electricity Provided by Fuel Type, 2000 Electricity Provided by Fuel Type, 2016 Q1 & Q2 Wind & Solar Hydro Other renewables Net imports Coal Other renewables Net imports Coal Oil & other fuels Wind & Solar Nuclear Oil & other fuels Hydro Nuclear Gas Gas 3

4 Electrical Energy Storage Pumped storage where we started <125GW installed globally in 2012 Compressed air energy storage Battery storage Sodium sulphur batteries Lead acid batteries Nickel batteries Lithium ion batteries Lithium titanate Further technologies where we are Flywheel Cryogenic energy Metal-air batteries Hydrogen storage Superconducting metals Sand Chemical mixes? Hohenwarte Pumped Storage Scheme & Leighton Buzzard Battery Storage Scheme 4

5 Energy Storage Benefits Reduce curtailment. Stabilise system frequency. Electrification schemes. Support peaking power plant mothballing. Source: Bellona Europa (2015) Defer distribution network reinforcement. Maximise value through arbitrage. Demand profile smoothing. Significant environmental benefits. 5

6 Flexibility

7 UK Ancillary Services Contracts Commercially Valuable Enhanced Frequency Response (EFR) Grid balancing service (50htz) Four-year contracts Sub-second frequency response Firm Frequency Response (FFR) Grid balancing service (50htz) Shorter contracts (1-2 years) Response time 2-10 seconds Capacity Market Capacity balancing service Up to 15 year contracts (for new capacity) Up to 4 hours notice of stress event Potential to participate in addition to EFR and FFR contracts 7

8 Energy Arbitrage Opportunities presented by volatility in the markets Battery energy storage responds effectively to increasing instances of intraday price movements Prices of 1,000 pmwh already seen in the UK this winter 8

9 Storage Facilitating EV Charging Increased numbers of EVs on the roads will have repercussions to the energy network: Expansion of charging infrastructure to meet demand resulting from increased EV numbers Network reinforcement will be required to support the increase in demand for EV charging As battery technologies improve, EV capacities increase and quicker charging is enabled, all requiring higher network capacity A significant challenge in expanding the EV charging network will be cost, with securing a grid connection and sufficient capacity being a significant portion of up front capital expenditure. Co-locating energy storage alongside EV charging infrastructure can alleviate these impacts: Improved load management, reducing necessity to reinforce grid infrastructure Support greater numbers of EVs charging simultaneously Improve the operational expenditure for energy by operating energy storage to avoid peak power pricing 9

10 EV Charging Hubs Significant increase in fleets of EVs is expected: London is set to own Europe s largest fleet of electric buses, with two routes, 507 and 521, becoming all electric. APAC experiencing significant growth in vehicle manufacture, delivery and use anticipated growth of EV ownership in the millions over next 5-10 years. UPS spent over 600,000 upgrading energy infrastructure at one of their central London depots, specifically to ensure their fleet of 16 EVs could be charged. The charging of EVs at peak times was, from an energy perspective, in direct competition with their sorting machinery, with the local grid unable to deliver sufficient capacity to meet demand. 10

11 Impact of EVs on Battery Prices Global increase in number of EVs has had a pronounced effect on Li-ion battery prices Battery surveys include electric vehicles. Source: Bloomberg New Energy Finance 11

12 Challenges Finance High technological cost. o Getting cheaper with time. Investor security contracts, guaranteed repayment, risk appetite. Technology Emerging technology. Uncertainty surrounding lifespan and degradation issues. o Manufacturers claim long life and durability. Small manufacturing quantities. 12 Other For some energy storage solutions, such as pumped hydro and compressed air, there are other barriers, such as geographic constraints. Policy influence. Comparative investment.

13 The Case for Asian Investment Similar intermittency challenges in terms of renewable and embedded generation. Connecting grids off grid and electrification. A lucrative investment. Global support. Increased interest. The need for diversity. Localised resources. 13

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16 We welcome this exciting project from Tesla and Camborne. Innovation in storage technologies will help manage our electricity grid more efficiently, support greater energy security and, crucially, drive down consumer bills. UK Energy Minister, Baroness Neville-Rolfe, 07 December 2016 L to R: Dan Taylor Managing Director, Camborne Energy Storage; Baroness Lucy Neville-Rolfe Energy Minister; Edward Sargent Manager, Tesla UK; Chris Roberts Managing Director, Poweri Dan Taylor Managing Director dtaylor@cambornecapital.co.uk CES s Battery Energy Storage project, utilising Tesla s Powerpack solution, alongside existing Solar PV site. 16

17 Head Office 48 Dover Street, Mayfair, London, W1S 4FF T