Stem and AEPCO Deploy Storage and Solar Project for Arizona Member Co-Op

Rhea-AI Summary

Stem and AEPCO have partnered with Prometheus Power to deploy a 40 MWh energy storage system integrated with a 20 MW photovoltaic system for Sulphur Springs Valley Electric Co-op (SSVEC). This project is part of three similar deployments expected to be operational by the end of the year, leveraging Stem's AI-driven software, Athena®, to optimize performance.

John Carrington, CEO of Stem, highlighted the rapid growth and future potential of the electric co-op segment, which is forecasted to represent over 20% of future storage deployments. Patrick Ledger, CEO of AEPCO, emphasized strategic investments in renewable energy and battery storage to diversify their energy portfolio.

SSVEC has significantly reduced its coal-generated energy from over 80% in 2016 to 25% in 2023, with 18% now from renewables. The project aims to provide reliable, cost-effective clean energy to 53,000 members, driving sustainable practices in the energy sector.

A ribbon-cutting ceremony will be held on June 13, 2024, in Sahuarita, Arizona.

Positive

• Successful deployment of a 40 MWh energy storage and 20 MW PV system for SSVEC.
• Integration of Athena®, Stem's AI-driven software, for optimized system performance.
• Rapid growth forecast in the electric co-op segment, projected to represent over 20% of future storage deployments.
• Strategic investments by AEPCO in renewable energy and battery storage to diversify energy portfolio.
• SSVEC reduced coal-generated energy from over 80% in 2016 to 25% in 2023, with 18% from renewables.
• Project aims to provide reliable, cost-effective clean energy to 53,000 members.
• Stem has booked more than $1 billion in contracts in the municipal and co-op utility market.

Negative

• No specific financial details or revenue projections for the project provided.
• Potential risk of project delays with all three deployments expected by year-end.

Insights

Financial Analyst

The recent collaboration between Stem and AEPCO represents a significant development in the clean energy sector, particularly for public power utilities. The deployment of a 40-MWh energy storage system alongside a 20-MW photovoltaic system indicates substantial progress for Stem, not only in terms of technological deployment but also in solidifying its presence in the public power cooperative market. With more than $1 billion in contracts from municipal and co-op utilities, it's clear that this segment is a vital growth area for Stem.

For retail investors, it’s notable that this project leverages Stem’s AI-driven software Athena® to enhance energy storage performance, which could potentially improve operational efficiency and reduce costs over time. This efficiency and cost-saving aspect could positively impact Stem's financial performance, potentially leading to improved profitability and higher stock valuation over the long term.

The collaboration with Prometheus and the involvement in AEPCO's Reliable Energy Plan further bolster Stem's market position, demonstrating their ability to deliver scalable and reliable clean energy solutions. However, investors should monitor the execution of these projects and any potential operational challenges, particularly given the scale and the involvement of multiple stakeholders.

Market Research Analyst

The partnership with AEPCO is strategic, especially given the projected growth of the front-of-the-meter (FTM) market. With electric co-ops forecasted to represent over 20% of future storage deployments, Stem’s involvement in this sector positions them for substantial market share acquisition. This signifies a strong long-term growth trajectory for the company.

For retail investors, understanding the dynamics of the clean energy market is crucial. The shift from coal-generated energy to renewable sources within SSVEC, from over 80% coal in 2016 to an estimated 18% renewable in 2023, showcases a broader industry trend towards sustainable energy. Stem’s role in facilitating this transition underscores its relevance and potential for future growth in similar markets.

However, investors should also be aware of the competitive landscape. As the largest electric utility network in the U.S. continues to evolve, new players and technological advancements could emerge, challenging stem's current market position. Keeping an eye on market trends and competitive actions is essential for making informed investment decisions.

Project strengthens Stem’s growing foothold in the public power sector; helps Sulphur Springs Valley Electric Co-op deliver reliable clean power to its members

SAN FRANCISCO--(BUSINESS WIRE)-- Stem (NYSE: STEM), a global leader in AI-driven clean energy solutions and services, and Arizona Electric Power Cooperative (AEPCO), a not-for-profit, member-owned electric generation and transmission (G&T) cooperative, in partnership with Prometheus Power (Prometheus), a national renewable energy developer, today announced the successful deployment of a co-located storage and solar project to help deliver clean, reliable power to its distribution co-ops and public power members.

Photo Credit: Arizona G&T Cooperatives (AzGT)

The project for Sulphur Springs Valley Electric Co-op (SSVEC), an AEPCO member co-op, includes a 40-megawatt hour (MWh) energy storage system and an existing 20-megawatt (MW) photovoltaic (PV) system that will integrate Athena^®, Stem’s award-winning AI-driven clean energy software, to continuously operate and monitor the storage system for maximized performance on a single, unified platform. The SSVEC project is the first of three similarly sized deployments that Stem will collaborate on with Prometheus to provide Stem’s services for AEPCO’s other managing co-ops. All three projects are expected to come online by the end of the year.

“More than 900 electric co-ops across 48 states make up the largest electric utility network in the U.S. The segment is forecasted to be one of the fastest growing segments of the front-of-the-meter (FTM) market through the end of this decade and is projected to represent over 20% of all future storage deployments,” said John Carrington, Chief Executive Officer of Stem. “Stem’s unique combination of AI-driven software, hardware, and services is enabling enhanced value and project returns at scale for co-ops and their members. We are excited to bring our proven capabilities and market experience to AEPCO and their members.”

“As part of our Reliable Energy Plan, AEPCO is focused on strategic investments in renewable energy assets and battery energy storage systems (BESS) to help fundamentally improve, diversify, and strengthen the AEPCO portfolio,” said Patrick Ledger, AEPCO executive vice president and CEO. “With Stem’s proven solar and storage solutions and expertise, we can ensure economies of scale on larger projects so our member co-ops can benefit from the flexibility and reliability of new clean energy resources that will substantially reduce costs and provide more reliable clean energy for the communities we serve.”

“As the largest co-op in Arizona, SSVEC has worked diligently to diversify our energy portfolio from having over 80% coal-generated energy in 2016 to just 25% in 2023 with an estimated 18% generated from renewable sources. These efforts help ensure greater energy independence, reliability, and price stability for SSVEC members, with an overriding benefit of a cleaner environment,” said Jason Bowling, Chief Executive Officer of SSVEC. “Working with AEPCO and Stem to ensure the successful deployment and optimization of our renewable energy assets will help SSVEC continue to honor our commitments of delivering affordable, reliable energy to our 53,000 members.”

“We are honored to have played a pivotal role in the construction of this monumental facility for SSVEC,” said Rohit Garg, Prometheus Manager. “With our developer expertise, we are confident that this project will set a new standard for co-ops implementing utility-scale renewable energy assets, driving forward the adoption of sustainable practices in the energy sector. We are looking forward to working with Stem on deploying future projects for AEPCO."

These follow Stem’s recent co-op project wins, including a 23 MW solar plus 60 MWh storage project for Mohave Electric Cooperative (MEC), an AEPCO distribution co-op, and a 313 MWh standalone energy storage project with Ameresco for a major co-op customer. Stem has booked more than $1 billion of contracts associated with the growing municipal and co-op utility market segment. Most immediately, AEPCO will be hosting a ribbon cutting ceremony in Sahuarita, Arizona on June 13, 2024.

Learn more about AEPCO’s clean energy strategies in the upcoming Stem webinar “AEPCO Leading the Way to Reduce Costs and Improve Reliability for Members,” register at https://www.stem.com/webinar-in-the-spotlight-aepco/.

About Stem

Stem (NYSE: STEM) provides clean energy solutions and services that maximize the economic, environmental, and resiliency value of energy assets and portfolios. Stem’s leading AI-driven enterprise software platform, Athena^® enables organizations to deploy and unlock value from clean energy assets at scale. Powerful applications, including AlsoEnergy’s PowerTrack, simplify and optimize asset management and connect an ecosystem of owners, developers, assets, and markets. Stem also offers integrated partner solutions that can improve returns across energy projects, including storage, solar, and EV fleet charging. For more information, visit www.stem.com.

About AEPCO

AEPCO is the generation, transmission, and energy services provider for electric distribution cooperatives and public utilities in Arizona, California, and Nevada. Headquartered in Benson, Arizona, AEPCO operates with its sister organization, Sierra Southwest Cooperative Services, Inc. (Sierra) under the umbrella of Arizona G&T Cooperatives. AEPCO owns and operates Apache Generating Station, situated in Cochise County, which has been under AEPCO's operation since 1961 and is equipped with existing natural gas and electric transmission infrastructure. For more information about AEPCO and its future projects, please visit www.azgt.coop.

Source: Stem, Inc.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240611821944/en/

Stem Investor Contacts

Ted Durbin, Stem

Marc Silverberg, ICR

IR@stem.com

Stem Media Contact

Suraya Akbarzad, Stem

press@stem.com

AEPCO Media Contact

Mandi Greenmyer

pr@azgt.coop

Sulphur Springs Valley Electric Co-op Media Contact

Marcus Harston

mharston@ssvec.com

Prometheus Media Contact

Rohit Garg

rohit@prometheuspowergroup.com

Source: Stem, Inc.

FAQ

What is the size of the energy storage system deployed by Stem and AEPCO?

The energy storage system deployed is 40 MWh.

What is the capacity of the photovoltaic system integrated with the energy storage for SSVEC?

The photovoltaic system has a capacity of 20 MW.

When are the three similar deployments by Stem and AEPCO expected to be operational?

All three deployments are expected to be operational by the end of the year.

What is the projected growth segment for electric co-ops according to Stem's CEO?

The electric co-op segment is forecasted to represent over 20% of all future storage deployments.

How much has SSVEC reduced its coal-generated energy since 2016?

SSVEC reduced its coal-generated energy from over 80% in 2016 to 25% in 2023.

How many members will benefit from the SSVEC project?

The SSVEC project aims to benefit 53,000 members.

When will the ribbon-cutting ceremony for the project take place?

The ribbon-cutting ceremony will take place on June 13, 2024, in Sahuarita, Arizona.