Boosting investment appeal to accelerate the energy transition

As the window for impactful climate action narrows, attracting private investment into renewable energy is essential to achieving the necessary shift away from fossil fuels. See what Atlas Renewable Energy has to say about it.

Climate change presents unprecedented challenges, including rising temperatures, extreme weather events, and disruptions to ecosystems and economies. To prevent irreversible damage and achieve the Paris Agreement’s goal of limiting global warming to well below 2°C, rapid decarbonisation of the energy sector is vital.

Renewable energy is the cornerstone of this transition, offering the most effective means to reduce greenhouse gas emissions and ensure a sustainable future. But despite its immense potential, barriers to implementing renewable energy at scale remain.

According to Atlas Renewable Energy, addressing these means making investments into renewables more competitive – driving widespread adoption and unlocking the sector’s full potential.

Overcoming Intermittency

One of the most significant challenges in scaling renewables for large industrial energy consumers is the fluctuating nature of power generation, which is dependent on highly variable environmental conditions. This variability leads to periods of overproduction and underproduction, making it difficult to ensure a consistent and reliable energy supply – a critical factor for business operations.

Already seeing rapid growth and development worldwide, battery energy storage systems (BESS) tip the scales toward making renewable energy a truly viable option. Using BESS, excess energy generated during peak production periods can be stored and released during periods of low production or high demand, reducing the need for fossil fuel-based backup power.

Enhancing Project Viability And Bankability

The integration of BESS doesn’t just enable us to harness the full potential of solar and wind sources; it also increases the overall viability and bankability of renewable energy projects. BESS enables energy arbitrage, allowing operators to take advantage of price differentials between peak and off-peak hours – providing a hedge against fluctuating energy prices and mitigating market risk.

Grid congestion and curtailment are other significant risks for renewable energy projects, and BESS help alleviate these issues by providing support services such as frequency regulation, voltage control, and peak shaving. By enhancing grid resilience, BESS ensure that renewable energy projects can operate efficiently and maximise their output, thereby safeguarding expected returns.

A Latin American Case Study

Atlas Renewable Energy is at the forefront of effective largescale BESS deployment in Latin America. Our latest project,

BESS del Desierto in Antofagasta, Chile, is among the country’s largest storage contracts. This BESS implementation, developed for the trading arm of Chilean energy and forestry giant Copec, features 200MW of capacity and 800MWh of storage and is Chile’s first large-scale standalone storage system.

Operating independently of power generation sources, the installation allows for more effective management of energy costs by enabling time-shifting of energy use during peak demand times when prices are higher. This is particularly beneficial in markets like northern Chile, where high solar penetration and industrial demand create significant price disparities between day and night.

We have also signed an agreement with mining company Codelco, the world’s largest copper producer, for the supply of 375 GWh of 24/7 energy per year, to be generated by a new solar energy project with an integrated battery storage system.

BESS facilitate the development of decentralised energy systems – a key enabler of fast-tracking the “just and orderly energy transition” set out in the International Renewable Energy Agency’s World Energy Transitions Outlook.

With BESS, energy generation and storage can be localised closer to the point of consumption. This reduces transmission losses and enhances energy security. For industrial clients like Codelco and Copec, this means greater control over energy supply and the ability to maintain operations even during grid disturbances.

Stability And Predictability

Technological advances like BESS can transform renewable energy from a variable and intermittent source into a stable, reliable, and economically viable solution.

But transforming the risk profile of renewable energy projects also requires a stable, predictable, and supportive investment landscape.

Over the last decade, we’ve been working to achieve this across the Americas, by implementing long-term power purchase agreements (PPAs) that provide revenue stability and predictability.

In 2015, our leadership team achieved one of Chile’s most iconic milestones, signing a renewable PPA with multinational mining giant Antofagasta Minerals to supply solar energy from the Javiera project to the Los Pelambres copper mine for a duration of 15 years.

In 2023, we signed an unprecedented 21-year US dollar PPA with Brazil’s largest aluminum producer, Albras – the longest term ever signed in Latin America for a corporate renewable energy PPA. The energy provided to Albras under this deal will be powered by the 902 MWp Vista Alegre plant, the largest solar project to be built in a single phase in Brazil.

And most recently, our BESS del Desierto initiative involves a

PPA with distribution companies, in which we receive a fixed monthly fee, regardless of asset usage, to reinforce the grid as a transmission infrastructure asset.

Building An Attractive Investment Landscape

In addition to financing structures that make renewable energy projects more accessible, governments and regulatory bodies must establish and maintain clear, consistent, and supportive policies that encourage renewable energy development and investment.

This is exemplified by the government support we’ve seen in some of the markets we operate. In Chile, for example, the Supreme Decree 70 of 2023, approved in June this year, explicitly addresses stand-alone energy storage systems and determines capacity payment mechanisms specifically for renewable energy plants equipped with energy storage capacities. While markets such as California are also testing and implementing BESS, Chile’s targeted regulatory framework is helping to put it ahead in terms of BESS deployment, underpinning our ambitious target to deploy up to 2 GW of battery storage capacity in the country over the coming years.

Investment opportunities in the global renewable energy sector are vast and growing, driven by the urgent need to mitigate climate change. At Atlas Renewable Energy, we are committed to delivering high-quality, efficient, and reliable solutions that significantly advance the energy transition. By enhancing project bankability and addressing scalability challenges, we ensure that investments in renewable energy yield substantial returns – both for the economy and the environment.