[SMM Analysis] Arizona GWh-level Battery Energy Storage System Project Signs Power Purchase Agreement

Salt River Project (SRP), a utility company in Arizona, has signed an agreement to obtain full scheduling rights for a new 250MW/1000MWh Battery Energy Storage System (BESS) project.

SRP announced last week (July 18) that it had signed an agreement with Aypa Power, the developer of the independent Signal Butte BESS project in Mesa, Arizona.

This 4-hour Li-ion battery project will be built in the Elliot Road Technology Corridor in Mesa, an industrial development area that houses high-tech manufacturing and technology companies.

Tenants include Apple, Meta, Amazon, and others. Google will also conduct some operations in the development area. Mesa has provided public infrastructure, a fast approval process, and a foreign trade zone, while Salt River Project supplies power to the industrial park.

Aypa Power (formerly known as NRSTOR C&I before being acquired by private equity giant Blackstone Group in 2020) took over the project from another developer, Eolian, L.P. (Eolian). The two parties jointly included the Signal Butte project in SRP's 2023 All-Source Request for Proposals (RFP).

Aypa Power purchased the project from Eolian in the later stages of development and will continue to own the project, while the utility company SRP has full rights to schedule the stored energy into its grid.

This is Aypa's first BESS project in Arizona. The company's other major announced projects are located in California and Texas, the battery energy storage hotspots of the US, with two more projects in Indiana, one of which was also purchased from Eolian.