Climate risk transfer platform Re2 and Akaysha Energy, a portfolio company owned by a fund managed by BlackRock’s Infrastructure business, have completed an â€œinnovative risk hedging arrangementâ€ for Akaysha’s 155 MW/300 MWh Ulinda Park battery energy storage system (BESS) in Hopeland, Queensland, Australia.
The Battery Revenue Swap Agreement was developed by Re2 to enable the mitigation of revenue risk for BESS projects, for a period of up to 10 years.
“The implementation of risk management solutions driven by the private sector will be essential to the build out of energy storage systems at a scale necessary to support the continued growth of variable renewable energy. We are proud to be working with market-leading partners and excited to have had the opportunity to collaborate with Akaysha and BlackRock on this risk transfer transaction. The team at Re2 has a well-earned reputation for bringing innovative products to the renewable energy market, and we look forward to continuing to play a catalyzing role in the energy transition,” said Richard Oduntan, CEO of Re2.
Nick Carter, CEO and managing director of Akaysha Energy, said: “The revenue swap product that we have developed with Re2 is exactly the sort of innovative offtake product that we need in the market right now to help accelerate the build-out of large-scale battery projects like the Ulinda Park BESS. The 10-year revenue swap provides the right balance of contracted and unhedged revenue, while still allowing us to operate the project and bid into the energy and FCAS [frequency control ancillary service] markets in the NEM [national electricity market].”
The Ulinda Park BESS is expected to commence operations in 2025.