Stem, one of the energy storage winners from Southern California Edison’s recent solicitation, has secured a $27 million round of equity financing from subsidiaries of two major energy players, Exelon and Total.
The deal underscores the growing interest utilities and conventional players are showing in energy storage. For example, California’s utilities are in pursuit of energy storage to meet an 1.3 GW state mandate by 2020. Meanwhile, Oncor late last year floated the idea of bringing 5,000 MW of energy storage to the Texas grid.
“Energy storage is becoming an increasingly important energy and demand management solution for customers and utilities,” said Michael Smith, Constellation vice president and head of Constellation Technology Ventures, a venture capital arm of Exelon Corporation. “We view Stem among the leaders in this market and look forward to taking an active role in facilitating Stem’s nationwide expansion.”
Stem said the financial infusion will help expand its predictive analytics energy optimization software platform and global market expansion. The company won a bid to supply 85 MW of storage to SCE in November, part of a 500 MW of clean energy the utility secured to replace San Onofre Nuclear Generating Station and retiring natural gas plants.
Total Energy Ventures, the venture capital arm of energy company Total, says the deal will help Stem expand its reach internally.
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“Total is always looking for ways to optimize its operations, and smart energy solutions like Stem’s play an important role in strengthening the service we offer our customers,” said Bernard Clement, senior vice president, business and operations of Total New Energies. “We believe Stem’s combined storage and software system adds considerable value to our offering and that of our affiliates.”
Stem describes its technology as combining advanced energy storage and real-time data analytics to help businesses reduce demand charges — with no impact to operations. The system draws on stored energy to shave peak loads. In aggregate, Stem’s customer portfolio can act as a dispatchable asset that a utility can call upon during periods of peak demand.
The Millbrae, California company also has financial backing from a consortium that includes Angeleno Group, Iberdrola (Inversiones Financieras Perseo) and GE Ventures.