Ormat Technologies Secures Long-Term Energy Storage Agreements
Ormat Technologies Achieves Significant Milestones in Energy Storage
Ormat Technologies Inc. (NYSE: ORA) recently announced a remarkable achievement that marks a pivotal moment in its journey within the renewable energy sector. The company has secured two 15-year tolling agreements for energy storage facilities, a significant win issued by the Israeli Electricity Authority. These agreements are set to bolster Ormat's presence in the energy storage market, with a combined capacity projected at approximately 300MW/1200MWh.
Partnerships and Project Development
The strategic development of these projects will be undertaken in collaboration with Allied Infrastructure LTD, a well-respected infrastructure company in Israel. This partnership signifies the first major foray of Ormat and Allied into the utility-scale energy storage domain in Israel, fostering further growth for both entities. The collaboration aims to not only realize these initial projects but also to explore additional energy storage developments in the region.
Advancing Towards Construction
Currently, both parties are diligently working to secure the necessary interconnections for the project, along with essential land use permits. This preparatory phase is crucial as it sets the groundwork for construction to commence, with operations anticipated to begin around 2028. The tolling agreements include an option for contract termination, providing a pathway to engage in the merchant market, underscoring the flexible strategies that Ormat is adopting.
Leadership's Vision
In a statement, Doron Blachar, CEO of Ormat Technologies, expressed his enthusiasm about the award of these tolling agreements, highlighting them as a significant milestone in the expansion of Ormat's energy storage business. The long-term nature of these agreements is a testament to the company’s capability to effectively manage and grow its energy storage portfolio. Blachar emphasized that these agreements will not only improve profitability but also ensure stability in margin performance, which are essential components of the company’s growth strategy.
Commitment to Renewable Goals
Blachar also emphasized the implications of these energy storage projects for Israel's renewable energy landscape. He expressed that the invocation of local assets and capabilities will be instrumental in Israel's ongoing efforts to meet its renewable energy targets and enhance energy reliability. This commitment demonstrates Ormat's alignment with global sustainability objectives.
About Ormat Technologies
Founded over five decades ago, Ormat Technologies is a leader in the geothermal energy sector and boasts a vertically integrated business model that encompasses geothermal and recovered energy generation (REG). The company is focused on accelerating its growth trajectory in the energy storage market, striving to establish its prominence within the U.S. energy storage landscape. Ormat’s innovative power generation solutions, particularly the Ormat Energy Converter, exemplify its advanced technological capabilities.
Current Portfolio and Future Plans
Currently, Ormat operates a diverse generating portfolio of 1.5GW. This includes a robust geothermal and solar generation setup amounting to 1.2GW distributed across various global locations, such as the U.S., Kenya, Guatemala, and Indonesia, among others. The company also maintains a 290MW energy storage portfolio in the U.S. With ongoing expansion efforts, Ormat aims to tap into energy storage services that combine solar photovoltaic technology with innovative energy solutions.
About Allied Infrastructure LTD
Allied Infrastructure LTD specializes in multi-disciplinary contracting services across various sectors including Airports, Highways, and Defense. The company is recognized for delivering quality infrastructure solutions, reinforcing the foundations of projects that enhance and maintain vital assets.
Frequently Asked Questions
What is the significance of the tolling agreements for Ormat Technologies?
The tolling agreements represent a strategic milestone for Ormat, allowing them to enter the energy storage market in Israel while reinforcing their growth strategy.
What is the expected capacity of the energy storage facilities?
The combined capacity of the energy storage facilities is projected at approximately 300MW/1200MWh.
Who is partnering with Ormat on these energy projects?
Ormat is collaborating with Allied Infrastructure LTD to develop these energy storage facilities.
When is the commercial operation expected to start?
The commercial operation is expected to commence during the year 2028.
How does this development align with Ormat’s overall strategy?
This development aligns with Ormat's strategy to expand its energy storage portfolio and enhance profitability while contributing to renewable energy goals.
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