The VRB Energy Storage System (VRB-ESS) being sold to Tapbury Management Limited for Phase II of the Sorne Hill Wind Farm in
The value of this contract to VRB Power has increased from $6.3m to approximately $9.4m.
The increase in size of the contract follows publication of an independent feasibility study on the implementation of the VRB-ESS at Sorne Hill, which was jointly commissioned by Sustainable Energy Ireland (SEI) and Tapbury Management Limited.
The study anticipates internal rates of return to purchasers of VRB Energy Storage Systems in
The study also concluded that the optimum size of the system is 2MW of power with six hours of storage and the ability to provide 3MW of pulse power for 10-minute periods every hour in order to deal with short-term volatility in wind generation.
John Ward, Director of Tapbury Management Limited, said: ‘The study provides technical and economic validation for a number of the key revenue streams that we had previously identified for the planned implementation of the VRB-ESS at Sorne Hill. The increase in the size of the system enables us to maximize these revenue streams and, when combined with additional market based payments, provides a strong economic case for this purchase. In particular, the study demonstrates the potential for purchasers of VRB Energy Storage Systems in the Irish market to achieve a very healthy IRR of 17.5% on their investment.’
He added: ‘This study now provides us with the data and validation required to finalise our off-take and other revenue agreements for Sorne Hill. This will in turn enable us to complete our project finance requirements and execute final contracts with VRB Power Systems.’
The study focused on wind generation at Sorne, and also showed the potential for storage across
The study highlighted the fact that the VRB-ESS will allow wind power to be dispatched in the same way as ‘base load and peaking plant’ generation. It will enable the integration of large amounts of wind energy without causing grid instability, thereby improving the economics of wind generation.
David Taylor, CEO of Sustainable Energy
Tim Hennessy, CEO of VRB Power Systems, said. ‘The report also highlights the need for storage in Ireland to enable the successful roll-out of wind generation from the current installed base of approximately 800MW up to and beyond the 3,000MW currently contracted or proposed, and to deal with the intermittency and constraint issues already being experienced. It is estimated that at least 700MW of storage may be required across
The agreement between VRB Power and Tapbury Management Ltd remains subject to execution of final contracts.