Ardian Infrastructure is betting on growing demand for efficient energy storage with its first infrastructure investment in Canada.
The infrastructure unit of Paris-based investor Ardian is forming a joint venture with Enel X, the advanced energy services unit of energy company Enel Group, to acquire and fund battery-storage projects across the Canadian province of Ontario.
The two investors are looking to capitalise on a growing appetite among Canadian businesses, particularly industrial companies, for efficient energy storage as more shift to renewable energy sources such as wind and solar power.
In Ontario, consumers and businesses are subject to global adjustment charges to offset the cost of building new electricity infrastructure in the province as well as the cost of energy conservation. Businesses, such as factories, that use large volumes of electricity during peak hours tend to pay more.
Battery storage enables the companies to reduce their energy costs, according to Stefano Mion, senior managing director of Ardian Infrastructure and co-head of the unit’s US operations.
“It’s effectively providing factories and companies with a battery that allows them to stay online at any given time and not pay surcharges for the spikes in energy prices,” he said.
Ardian and Enel X are forming a dedicated holding company, with Ardian owning an 80% interest and Enel X the remaining 20%, according to a press release. The joint venture will consist of 10 battery-storage production assets across Ontario, including two that are expected to reach commercial operation by 2021. Enel will manage the operations of all the projects and oversee the development of new projects.
Ardian has worked with Enel Group in the past when it made an initial investment in Italian gas network Enel Rete Gas Group in 2009.
The new battery-storage joint venture marks the fifth investment from Ardian Americas Infrastructure Fund IV LP, which closed with more than $800m in 2018. Previous investments from the fund include Skyline Renewables, a renewable energy joint venture it formed alongside Transatlantic Power Holdings, and LBC Tank Terminals, which operates bulk liquid storage facilities.
Source: Wall Street Journal
