Ormat Technologies Inc, an Israeli geothermal firm, has announced the acquisition of a shovel-ready energy storage asset in Upton County, Texas, from Con Edison Development.
Ormat’s (ORA) wholly owned subsidiary, Viridity Energy Solutions Inc, will design, build, own and operate a 25 MW battery energy storage system (BESS) project at the site and Ormat is targeting commercial operation of the BESS by the end of 2021.
The company stated that the BESS facility will provide ancillary services and energy optimization to the wholesale markets managed by the Electricity Reliability Council of Texas (ERCOT).
Texas is currently experiencing growth in renewable energy deployment and the BESS facility will play an increasing role in allowing ERCOT to absorb such intermittent generators, while also coping with increased frequency of extreme weather events, the company said.
“This represents our second energy storage project in Texas,” said Ormat CEO Doron Blachar. “With this second project, Ormat strengthens its position as one of the early movers in the ERCOT energy storage market.”
Blachar noted that the “acquisition reinforces our target to add between 80 MW to 175 MW revenue-generating energy storage assets by year end 2022 and is in-line with our stated strategy to build, own and operate energy storage assets in strategic high growth markets including Texas.”
Ormat shares rose over 5% on Friday to $86.52 giving it a market cap of around $5 billion. (See ORA stock analysis on TipRanks)
On Dec. 9, J.P. Morgan analyst Mark Strouse raised the stock’s price target from $78 to $86 and reiterated a Buy rating.
Consensus among analysts is a Moderate Buy based on 2 recent Buy ratings. Meanwhile, the average price target of $80 implies downside risk of around 8% over the next 12 months.
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