The Federal Energy Regulatory Commission has approved a transaction through which bankrupt flywheel energy storage firm Beacon Power will transfer its assets to new owners.
Beacon Power subsidiary Stephentown Regulation Services LLC built an energy storage system in Stephentown, New York. The project bears a 20 MW nameplate capacity, and uses Beacon's patented flywheel technology to help the New York Independent System Operator balance the electric grid, providing regulation service under the grid operator's Limited Energy Storage Resource tariff. Beacon was able to develop the program using a $43 million loan guarantee from the U.S. Department of Energy's
loan program office in 2010, and benefits in theory from FERC Order No. 755, which required grid operators to pay more for fast-responding frequency regulation that Beacon Power's flywheels may be able to provide. Nevertheless, Beacon went bankrupt at the end of 2011.
Last month, private equity firm Rockland Power Partners proposed to buy the bankrupt company for $30.5 million: $5.5 million cash and a $25 million promissory note
to the DOE. Rockland says that it intends to continue operating the
Stephentown plant and developing a second facility in Hazle Township,
As part of the deal, Stephentown Regulation Services LLC filed an application to FERC under section 203(a)(1) of the Federal Power Act requesting Commission authorization to transfer its flywheel facility and related interconnection facilities (the “Facility”) located in Stephentown, New York, together with Stephentown’s rights, title and interest in, to and under, various assets including its market-based rate authority, its books and records and other related jurisdictional agreements to Stephentown Spindle, LLC, a subsidiary of Rockland.
FERC granted Stephentown's request last week, authorizing the transfer of Beacon's jurisdictional assets. Although there are a few remaining steps for Beacon and Rockland to figure out, this regulatory approval largely paves the way forward for the New York flywheel energy storage project to change hands to its new owners.