Goldman Sachs Asset Management is investing US$250-million in Hydrostor Inc., which the energy storage developer will use to move planned projects in California and Australia forward.
Hydrostor, whose technology allows utilities to add more wind and solar power onto their grids, said Goldman Sachs will provide the capital as needed for project milestones and to accelerate development. It will also support the Toronto-based company’s international marketing efforts alongside its current partners.
The company said the investment, in the form of preferred equity, is one of the largest in what is known as long-duration energy storage. Hydrostor is developing two 500-megawatt projects in Southern and Central California, and a 200-megawatt development at Broken Hill, New South Wales, Australia.
Energy storage is becoming more important as utilities around the world begin to phase out fossil-fuel generation in favour of more renewables. Coal- and gas-fired plants provide more predictable power but are major carbon emitters, contributing to climate change.
Hydrostor’s technology works by pumping compressed air into an underground cavern, which displaces water. The water rises into a reservoir at the surface. When the power is needed, the water is released back into the cavern, which pushes the air back out and drives turbines. Hydrostor has pilot and commercial demonstration plants operating on Toronto Island and in Goderich, Ont.
Hydrostor’s other investors include Canoe Financial, ArcTern Ventures, MaRS Catalyst Fund, Lorem Partners and Elemental Energy Inc. Last summer, it received $10-million from the federal government’s BDC Capital to advance its projects.
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