Lunas Energy offers financed BESS upgrades for Spanish solar plants

Lunas Energy, a Málaga-based private equity firm, has launched Merchant Plus, a model for adding battery energy storage systems (BESS) to merchant solar plants in Spain without upfront investment by the plant owner.

In exchange, the plant owner signs a long-term power purchase agreement (PPA) with Lunas. The contracts typically run for 20 to 25 years and cover the combined output of the solar plant and battery.

The guaranteed remuneration is set individually for each plant as a percentage of the prevailing merchant price. It applies to the daily wholesale market price for the plant’s entire daily output, rather than only the electricity passing through the battery.

Lunas said the model can increase total merchant revenues by up to 33% at suitable plants.

The BESS is installed behind the existing grid connection and hybridized with the solar plant, allowing both assets to use the same grid connection.

Lunas finances and fully installs the storage system, while the solar plant owner retains ownership of the BESS. Investment-grade energy offtake partners support the commercial operation, managing the combined output and determining when electricity is sold to the grid, stored or directed to other market opportunities.

Systems are sized individually for each plant, with Lunas currently focusing on batteries with durations of between 3.5 and four hours.

Merchant Plus forms part of Lunas Energy’s strategy to hybridize operating solar plants with battery storage. In June, the company said it was seeking 2 GW of operating solar capacity in Spain for co-located BESS projects and had potential agreements covering more than 600 MW of PV capacity.

The model allows existing solar plants to add storage without their owners directly undertaking the BESS investment, development or operation. Lunas handles site identification, commercial structuring, permitting and technical studies, as well as coordinating suppliers, contractors and project financing.

From pv magazine España