NextEra Energy Inc. plans to invest $100 million in energy-storage systems over the next year to back up its fleet of solar and wind energy plants.
NextEra is the world’s biggest producer of wind and solar power, and will use the battery systems to manage energy fluctuations caused by cloudy weather and lulls in the wind, Jim Robo, chief executive officer of the Juno Beach, Florida-based company, said Tuesday at an analyst conference.
Power companies are showing more interest in storage, especially batteries, which are becoming cheaper. The technology offers the potential to make intermittent power sources more reliable and more affordable, Robo said.
“Battery storage is the holy grail of the renewables business,” Robo said at the Wolfe Research Power & Gas Leaders conference in New York. “If we can deliver firm power to our renewable customers at a cost-effective rate, you’ll see renewables explode even faster than they already are.”
Robo’s NextEra Energy Partners LP, formed last year to own and operate the parent company’s portfolio of renewable energy plants, has lost more than half its market value since June 1. It’s one of several similar holding companies that have slumped in recent months amid concerns that rising interest rates may make it harder for them to buy more power projects. Robo said that may give NextEra an opportunity to increase market share.
NextEra will initially test the storage systems in markets including California, Arizona and the Northeast U.S., where power prices are typically highest or regulations offer premiums for storage capacity.
“This has the potential to be an extremely big market,” Robo said.
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