Hydrostor energy storage project files for Application for Certification

The Pecho Energy Storage Center will deploy Hydrostor’s proprietary Advanced Compressed Air Energy Storage (A-CAES) solution. The state-of-the-art project will provide large scale, long-duration energy storage for the region with no fossil fuel consumption and no greenhouse gas (GHG) emissions. With commercial operation date (COD) as early as 2026, Pecho will play a vital role in helping meet the region’s future energy supply and reliability needs after the retirement of the 2200 MW Diablo Canyon Power Plant in 2024/2025.

Pecho’s ability to flexibly deliver 400 MW of stored energy, every hour, for eight hours without relying on fossil fuels or other polluting resources would make the project one of California’s largest single new energy storage facilities. Pecho would surpass all existing battery energy storage projects in California in terms of both megawatts delivered and duration of generation, with an expected capital investment of approximately US$800 million.

Long-duration energy storage is one of the cornerstone solutions to a carbon-free renewable energy future. Pecho’s ability to deliver 400 MW of carbon-free electricity for eight hours will be comparable in size and resiliency to some of California’s largest fossil-fuelled powerplants. Pecho’s quick-starting, flexible, and dispatchable long-duration energy supply will have the ability to ramp-up and down through a wide range of electrical output. This flexibility over long durations is vital in facilitating the integration of onshore and offshore renewable energy and will play a critical role in helping achieve California’s climate change objectives.

State law designates the CEC to serve as the Lead Agency for California Environmental Quality Act (CEQA) review and permitting of the facility. Pecho’s filing of its AFC with the CEC will initiate the very thorough and comprehensive public review process. The County of San Luis Obispo and numerous other local, state, and federal agencies, as well as interested community stakeholders, will be closely involved in the CEC-led review.

The development of the project will provide a pathway for local skilled labour to shift to the green economy, as the community begins to transition away from the Diablo Canyon Power Plant and the fossil fuel sector as key employers in the area. It is expected that the project will provide between 200 and 450 skilled labour jobs (average to peak) during its four years of construction. Once operational, Pecho will create 30 to 40 full-time equivalent, good paying jobs. The project will also generate significant new property tax revenues for San Luis Obispo County and is expected to generate over US$500 million in direct and indirect regional economic benefits during its commercial lifespan.

Pecho will interconnect at the existing 230 kV PG&E Morro Bay Switching Station. The project is strategically located to provide enhanced utilisation of both existing and future renewable energy resources serving California and the Central Coast. Pecho’s emissions-free operations will play a vital role in helping meet California’s future power supply needs and significantly reducing the frequency of large scale blackouts. The project is also consistent with San Luis Obispo County’s long-term energy goals, as outlined in the Board of Supervisors Resolution adopted unanimously in 2021.

The California Public Utilities Commission (CPUC) adopted a decision in June 2021 directing the procurement of 1000 MW of long-duration (energy for eight hours or longer) energy storage to be online between 2026 - 2028. This decision follows years of studies and stakeholder input that culminated in this first-of-its-kind mandate to maintain the reliability, flexibility, and resilience of the electrical gird as it transitions to achieve legislated GHG reductions. Hydrostor applauds the leadership of the CPUC and is confident that the Pecho will be a key element in California’s clean energy transition.

Curtis VanWalleghem, CEO, Hydrostor, said, “[This] filing marks the first of many important milestones in the implementation of Hydrostor’s commitment to helping California meet its recognised long-duration energy storage needs. Deployment of Hydrostor's unique combination of being a proven, cost effective, and carbon-free long-duration storage solution will greatly enhance California's programme to fully transition to a reliable and carbon-free energy future. Our A-CAES facilities are designed to operate safely and efficiently for over 50 years with zero degradation. We look forward to working closely with the citizens of San Luis Obispo County to earn their trust and support on our way to becoming a valued member of the community. Pecho complements our previously announced 500 MW, 4000 MWh Gem Energy Storage Center located in Kern County, California.”

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