Ameresco Entered into a $249M (196.5 million GBP) Contract and Long-Term Service (O&M) Agreement with Atlantic Green for One of the UK’s Largest Battery Energy Storage Projects

Rhea-AI Summary

Ameresco has signed a $249 million contract and long-term service agreement with Atlantic Green for the construction of one of the UK’s largest battery energy storage projects.

The 300-megawatt project, utilizing Envision Energy's Battery Energy Storage System (BESS), will commence in the first half of 2024 and connect to the grid by the end of 2026. The project aims to enhance the UK's energy security and support its net-zero carbon emissions target by 2050.

Atlantic Green, a joint venture between Nofar Energy and Interland Group, aims to develop 2 GW of battery storage capacity in the UK. This project represents a significant milestone for both Ameresco and Atlantic Green in their sustainability efforts.

Positive

• Ameresco secures a $249 million contract, enhancing its revenue streams.
• The 300 MW BESS project positions Ameresco as a key player in the UK’s energy market.
• Project supports the UK’s net-zero carbon emissions target by 2050.
• Partnership with reputable companies like Envision Energy and Atlantic Green strengthens Ameresco’s market credibility.

Negative

• Long project timeline with completion expected only by the end of 2026, which may delay positive financial impacts.
• Large upfront costs for Ameresco could impact cash flow in the short term.
• Dependence on successful grid connection and regulatory approval could pose risks.

Insights

Financial Analyst

Ameresco's new contract for a $249M battery energy storage project in the UK is a significant development for the company. This large-scale project represents a substantial revenue opportunity, which can positively impact Ameresco's financials over the next few years. Investors should pay attention to revenue projections and profit margins related to this project.

Short-term: The news of such a major contract can boost AMRC stock due to increased investor confidence. However, it's important to consider the initial investment costs and the timeline for revenue realization, which won't be immediate.

Long-term: Completion of this project by 2026 is aligned with broader market trends toward renewable energy and energy storage. Success here could pave the way for more large-scale projects, enhancing Ameresco's position in the market and potentially leading to a more stable revenue stream.

Investors should also consider potential risks such as project delays, cost overruns and regulatory challenges, which could impact financial outcomes.

Key data: Amount: $249M, Project timeline: 2024-2026.

Rating: 1

Energy Market Analyst

This project is a milestone for the UK's energy sector. Battery Energy Storage Systems (BESS) are critical for stabilizing the grid as the UK transitions to renewable energy sources. The 300 MW capacity project will enhance grid reliability and support the integration of solar and wind power, which are intermittent in nature.

Short-term: The construction phase will generate economic activity and create jobs, benefiting the local economy. It also signals strong demand for advanced battery solutions, suggesting a robust market for such technologies.

Long-term: Once operational, the Cellarhead BESS will significantly contribute to the UK's energy security and its net-zero goals. This is particularly relevant as the UK aims to phase out fossil fuels and increase renewable energy capacity. It also sets a precedent for future projects, potentially accelerating the adoption of similar energy storage solutions.

However, market dynamics such as energy prices, regulatory changes and technological advancements will play critical roles in determining the project's long-term success.

Rating: 1

Environmental Analyst

The Cellarhead battery storage project aligns well with the UK's environmental objectives. By providing a reliable storage solution for renewable energy, it helps reduce reliance on fossil fuels and mitigates greenhouse gas emissions.

Environmental impact: The BESS will enable more efficient use of renewables, ensuring that excess energy generated during peak times can be stored and used when demand is high. This not only helps in balancing the grid but also minimizes wastage of clean energy.

Additionally, the project supports the UK’s target of achieving net-zero carbon emissions by 2050. By facilitating a higher penetration of renewable energy, it directly contributes to reducing the country's carbon footprint.

Risks: While the project has clear environmental benefits, potential risks such as the life cycle impacts of the batteries used, including extraction of raw materials and end-of-life disposal, should be considered. Companies involved must ensure that sustainable practices are followed throughout the battery life cycle.

Overall, the environmental benefits far outweigh the potential risks, making this project a positive development for sustainable energy initiatives.

Rating: 1

The 300-megawatt EPC project, powered by Envision Energy's Battery Energy Storage System, is scheduled to break ground in H1 2024

FRAMINGHAM, Mass.--(BUSINESS WIRE)-- Ameresco, Inc., (NYSE: AMRC), a leading cleantech integrator specializing in energy efficiency and renewable energy, today announced that Ameresco and Envision Energy have been chosen by Atlantic Green to build the Cellarhead project, a 300-megawatt (MW) battery energy storage project (BESS) with a maximum energy capacity of 624 megawatt hours (MWh). The Cellarhead BESS project will be connected to National Grid’s Cellarhead sub-station and will provide the UK with additional energy security and reliability.

Construction is anticipated to commence on site this year with connection to the electricity grid anticipated at the end of 2026. With a maximum energy capacity of 624 megawatt hours, the Cellarhead BESS project will support the UK’s ambition to achieve net zero, supporting the increased penetration of clean energy generation, decrease reliance on fossil fueled generation, and ultimately mitigate greenhouse gas (GHG) emissions.

Atlantic Green was established in 2021, as a joint venture between two entrepreneurial shareholders Nofar Energy, and Interland Group, as a UK-based platform to invest, develop, and operate grid-scale standalone battery energy storage systems across the UK. With a mission to develop a c.2 GW capacity of battery energy storage to fuel the UK’s clean energy transition, the Cellarhead BESS represents a key milestone for both Atlantic Green’s development journey and wider sustainability objectives. As part of the BESS project Ameresco entered into an EPC and O&M contract including battery supply, balance of plant, warranty, and availability guarantees. The EPC full wrap price is c. $249 million (196.5 million GBP). Tier 1 OEM Envision Energy will provide the BESS and associated services, as well as the equipment warranties.

Ameresco and Atlantic Green expect to finish the BESS and secure grid connection by the middle of 2026. Following completion, Atlantic Green will own and operate the BESS as an energy storage asset.

“We believe that a continuous development of battery energy storage is a vital step in the UK’s journey to achieving net-zero carbon emissions, and we are excited to team up with Ameresco to bring this vision to life,” said Nick Bradford, Managing Director of Atlantic Green. “Since our founding, Atlantic Green has consistently prioritized finding strategic ways to leverage our battery storage assets with the wider community and we are eager to answer the rising demand for battery storage with this new project with such a level of energy capacity, to really make the impact on the UK electricity system that is much needed.”

“We’re excited to announce our collaboration with Atlantic Green to construct one of the largest battery energy storage projects in the United Kingdom,” said Mark Apsey, MBE, Senior Vice President of UK Operations at Ameresco. “Energy storage is one of the key technologies required to achieve the UK’s net zero targets. Atlantic Green’s strong company leadership and robust track record of developing similar projects makes them an excellent partner in this endeavor. Together, Ameresco and Atlantic Green will help support the UK’s progress towards increased power autonomy and achieving net-zero carbon emissions by 2050.”

"This project exemplifies our commitment to pushing the boundaries of battery storage technology, a cornerstone of sustainable energy systems,” said Kane Xu, Global VP, Envision Energy. “Partnering with Atlantic Green and Ameresco allows us to demonstrate the pivotal role that advanced battery solutions play in enhancing energy security and enabling a seamless transition to renewable energy sources. We are proud to contribute our cutting-edge technology to this landmark UK initiative."

To learn more about Atlantic Green, visit, https://www.atlanticgreen.co.uk.

To learn more about Ameresco and the company’s clean energy solutions, visit www.ameresco.com.

To learn more about Envision Energy and their technology solutions for green energy, visit https://www.envision-group.com/envision-energy.

About Ameresco, Inc.

Founded in 2000, Ameresco, Inc. (NYSE:AMRC) is a leading cleantech integrator and renewable energy asset developer, owner and operator. Our comprehensive portfolio includes solutions that help customers reduce costs, decarbonize to net zero, and build energy resiliency while leveraging smart, connected technologies. From implementing energy efficiency and infrastructure upgrades to developing, constructing, and operating distributed energy resources – we are a trusted sustainability partner. Ameresco has successfully completed energy saving, environmentally responsible projects with Federal, state and local governments, utilities, healthcare and educational institutions, housing authorities, and commercial and industrial customers. With its corporate headquarters in Framingham, MA, Ameresco has more than 1,500 employees providing local expertise in North America and Europe. For more information, visit www.ameresco.com.

About Envision Energy

Envision Energy is a world-leading green technology company that provides renewable energy solutions for global enterprises, governments, and institutions. Encompassing three major business sectors - Smart Wind Turbines, Energy Storage, and Green Hydrogen Solutions, Envision Energy collaboratively constructs comprehensive solutions for energy transformation. It also manages the Envision-Hongshan Carbon-Neutral Fund and owns Envision Racing Formula E team, which conquered the Formula E Teams' Championship in 2023.
Envision Energy has been lauded for its sustainability performance, earning the EcoVadis Gold Medal and a place on the CDP “A-List”. It has been recognized in Fortune's “Change the World” list and ranked among the top 10 smartest companies by the MIT Technology Review.
Today, Envision Energy leverages its global network of R&D and engineering centers across China, the United States, the UK, France, Germany, Denmark, and other countries to continuously lead global green technology development. Envision Energy joined the Science Based Targets initiative (SBTi) and committed to achieving the "Business Ambition for 1.5°C" in 2021. It achieved carbon neutrality across its global operations by 2022 and will achieve carbon neutrality throughout its value chain by 2028.
For more information, visit www.envision-group.com

About Atlantic Green

Atlantic Green is a joint venture between two entrepreneurial shareholders, Interland and Nofar Energy. Atlantic Green focuses on investing, developing and operating grid-scale standalone battery energy storage projects in the United Kingdom.

​Nofar Energy (TASE: NOFR) is a global Independent Power Producer and developer of renewable energy assets, specialising in solar and battery energy storage. Nofar benefits from global expertise and leadership in the storage sector. Nofar Energy has a portfolio of c. 3.0 GW of solar and energy storage assets across Israel, Spain, Italy, UK, US, Romania, Germany, Poland, Greece and Serbia, of which 1.1 GW are operational or ready to be connected.

​Interland is a private investment group based in London, UK. The group invests in, develops and operates real estate and renewable energy assets in the United Kingdom, Netherlands and Belgium. For more information, visit https://www.atlanticgreen.co.uk/.

The announcement of a customer’s entry into a project contract is not necessarily indicative of the timing or amount of revenue from such contract, of Ameresco’s overall revenue for any particular period or of trends in Ameresco’s overall total project backlog. A portion of this project was included in our previously reported awarded backlog as of March 31, 2024.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240523146272/en/

Media:

Ameresco: Leila Dillon, 508-661-2264, news@ameresco.com

Source: Ameresco, Inc.

FAQ

What is the value of Ameresco's contract with Atlantic Green?

Ameresco's contract with Atlantic Green is valued at $249 million (196.5 million GBP).

When will construction of the Cellarhead BESS project begin?

Construction of the Cellarhead BESS project is scheduled to begin in the first half of 2024.

What is the energy capacity of the Cellarhead BESS project?

The Cellarhead BESS project has a maximum energy capacity of 624 megawatt hours (MWh).

When is the Cellarhead BESS project expected to be connected to the UK grid?

The Cellarhead BESS project is anticipated to connect to the UK grid by the end of 2026.

How does the Cellarhead BESS project support the UK’s net-zero targets?

The Cellarhead BESS project enhances energy security and reliability, aiding the transition to renewable energy and reducing greenhouse gas emissions.