Foresight Group has made its first deal in the energy storage space, purchasing a 35MW battery project in north-eastern England from Renewable Energy Systems.
Investing from its Foresight ITS fund, the UK-based infrastructure and private equity firm acquired the battery system under development in Port of Tyne. Foresight did not disclose financial details about the deal.
Foresight, which manages around £2.6 billion ($3.29 billion; €2.95 billion) of assets, is positioning itself to participate in the growing market demand for storage of renewable energy.
“The acquisition consolidates Foresight's position as a leader in investing both in renewable energy generation and the flexible grid infrastructure required to accommodate increasing penetration of renewables, such as energy storage,” Dan Wells, a partner at Foresight, explained.
The project Foresight purchased is expected to start operations next year. It has signed a four-year frequency-response contract and a 12-year capacity contract with National Grid, providing electricity balancing services and back-up power when demand is high.
Earlier this month, Infrastructure Investor reported the firm is aiming for a first close on its Foresight Energy Infrastructure Partners fund by the end of the year. FEIP is targeting £500 million with a hard-cap of £700 million.
The UK has increasingly sought to build out battery storage systems to complement its renewables production. Last year, it procured 201MW of enhanced frequency response systems through a tender in August and held a capacity auction that awarded tenders for 500MW of battery storage contracts.