Long-term energy storage developer Hydrostor Inc., described by U.S.-based Canary Media as an “iconoclastic Canadian startup”, has scored US$250 million from Goldman Sachs Asset Management to help it advance projects it plans to complete in California and Australia.
Toronto-based Hydrostor “is developing two 500-megawatt projects in Southern and Central California, and a 200-megawatt development at Broken Hill, New South Wales, Australia,” the Globe and Mail reports. It’s one of the largest providers of long-duration energy storage, with demonstration plants now in operation in Toronto and Goderich, Ontario.
The Goldman Sachs investment “is growth capital; it’s not ‘prove the technology’ venture capital,” Hydrostor CEO Curtis VanWalleghem told Canary Media this week. “We were able to show them how compelling the technology is and how advanced our development projects are.”
The investment opens the door to Hydrostor to double its 25-member staff this year.
That technology works “by pumping compressed air into an underground cavern, which displaces water,” the Globe explains. “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.”
Canary Media says Hydrostor positioned itself for one of the biggest long-term storage investments ever by “spending relatively little money” and making “strategic use of Canadian government grants to develop its early demonstrations.” It built a profitable, 2-MW/10-megawatt hour project in Ontario in 2019, while investing $5 million to develop three other projects that would ultimately cost $2.5 billion to build and produce at least $5 billion in revenue, VanWalleghem said.
“Having a megawatt-scale project making money in a power market is a basic achievement that still continues to elude many long-duration storage startups,” Canary Media notes.
Veteran renewables and storage reporter Julian Spector notes that the three new projects are designed to deliver eight hours of stored power at full capacity, and with a bigger canyon to hold more air, the technology could do even more.
“That kind of duration, at the scale of hundreds of megawatts, puts Hydrostor into contention with a conventional pumped hydro plant, which is by far the leading source of grid-scale energy storage,” Spector writes. “But pumped hydro requires a site with significant changes in elevation and copious supplies of water. Hydrostor’s concept boasts a dramatically smaller footprint and relatively negligible water needs, making it more geographically versatile.”
“All we need is reasonably competent bedrock,” VanWalleghem said. “We have a mousetrap that we truly believe is better than other people’s mousetraps,” and “where we choose to play and put our money, we expect to win.”