Industry fund Aware Super, formerly First State Super, has invested US$30 million ($40.4 million) into SER Capital Partners’ New York City microgrid project, which will repurpose under-utilised real estate into battery storage hubs.
This would include parking lots, alleyways and rooftops, and the new developments would have a capacity to generate 120 megawatt/hours of energy which could power 6,300 homes.
SER Capital Partners, a US-based private equity firm specialising in sustainable investments, had been managing New York City and other urban area microgrid projects for two decades and offered expertise in control and acquisition of land in that market.
The project would see nine lithium-ion battery facilities dispatch locally-generated energy through the grid at peak periods and recharge during off-peak times.
Locations had been strategically chosen to support weak points in the grid and would also support New York City’s goals of achieving 100% carbon-free electricity generation by 2040.
A similar project was also being rolled out concurrently in Texas, where Aware Super had invested another US$10 million to support 60 megawatt/hours of energy to power 1,600 homes, where onshore winds would help charge the batteries via the grid when demand is low.
Damian Graham, Aware Super chief investment officer, said these projects supported the fund’s commitment to invest at least $150 million per year in renewable energy and new technologies.
“Our involvement in battery storage projects like this helps Aware Super to protect our members long-term financial future by reducing the carbon footprint of our portfolio as we work towards our goal of net zero emissions by 2050,” Graham said.
“Through investments such as this we are delivering for our members in terms of sustainable long-term returns, while also doing good in the global community.”
Although the projects were in the US, the fund hoped to use the learnings from the developments to help pave the way for similar investments in Australia.
“Developments like this also help us to better understand the return profile of the sector and consider the potential for similar investments in Australia in future,” Graham said.
“The recently-announced Victorian Big Battery, slated for roll out near Geelong, shows the emerging interest in battery storage capability domestically.”
Graham said with the right partners and incentives, the fund would welcome the opportunity to invest in similar projects in Australia.
“We also know the cost of lithium-ion is decreasing around 15 per cent every year thanks to increased uptake of electric vehicles and the like, which makes battery storage investments even more viable,” Graham said.
“This, coupled with compelling incentives for investors, such as that being offered in the New York project in particular, show the investment potential of this sector.”