UNITED KINGDOM: Further details emerge of latest Network Rail renewables procurement
Network Rail is running an exercise to find a private sector partner to build a portfolio of utility-scale battery storage projects alongside its rail network.
The UK’s infrastructure operator for its railway system requires 3.7 TWh of electricity each year for traction to run passenger and freight trains across its routes, delivered through 105 connections to both transmission and distribution networks across the county.
The batteries are intended to help meet some of this demand, which can fluctuate between high peaks and low troughs.
The projects could either be located near grid access points or adjacent to electrified rail lines.
Network Rail has indicated that the long-term contract for a partner to create the energy storage portfolio could be valued at between GBP 150m-200m.
The group was understood to have yesterday (June 12) assembled a group of developers for a market engagement briefing in advance of a more formal negotiation phase.
Groups including Statera, Conrad Energy, Renewable Power Capital and US-based Renew Energy Partners are understood to have expressed interest in the opportunity, while Qualitas Energy is another name mooted to have been connected to the process at an earlier stage.
NPM Europe contacted each of the companies, with a spokesperson for Conrad Energy responding that it works and consults "with a wide range of companies in the transport and logistics sector on their energy generation and supply needs [but does] not comment on individual commercial contracts.”
The rest of the developers either declined to comment or did not respond.
The battery procurement is one of several that Network Rail has initiated in the renewable energy sector as it bids to secure 100% of its electricity supplies from clean energy sources by 2030.
The group in autumn 2023 first indicated its intention to find a partner to develop land spread across sites at stations, depots, offices and car parks into solar installations.
The group is seeking to arrange the PPA to run for a period of 25 years with its chosen supplier, with excess energy generated sold to the grid.
The developer selected by the group will also enter into a five-year development agreement for the portfolio, with a potential two-year extension, as well as a 25-year site lease on project locations which can also be extended by another five years.
The move is just the latest part of the rail group’s forays into renewables procurement, with previous activity including a 15-year corporate PPA signed with EDF Renewables in August 2022.
That offtake agreement was in mid-2023 renegotiated up by around 50%, taking the estimated price from the high GBP 50s/MWh or low GBP 60s/MWh up to potentially more than GBP 80/MWh.
*This story was originally published exclusively for NPM Europe subscribers.
NPM Europe is a leading data, intelligence and events company covering the European renewable energy market for the development, financing, M&A and corporate community.