Corre Energy announced the signing of binding commercial terms for a 15-year offtake agreement, with extension rights, with Eneco, for the entire storage capacity of the Zuidwending Compressed Air Energy Storage (CAES) project in the Netherlands. Eneco is a leading renewable power supplier and energy service provider in the Netherlands and Belgium, operating and expanding its activities in the UK and Germany, and is committed to accelerating the energy transition. Zuidwending is located in the Province of Groningen in the Netherlands.

Corre Energy has exclusive rights to build a CAES facility using salt caverns at the site, in conjunction with its cavern development partner. The facility will have 320 Megawatts of power generating capacity, with a maximum storage discharge duration of approximately 3.5 days and a target commencement date around the end of 2026. It will be constructed as hydrogen fuel enabled from commencement.

Under the terms of the arrangement, Corre Energy will construct, operate and maintain the facility and Eneco will optimise the entire output of the storage site on behalf of Corre Energy. Eneco will provide market access services, enabling Corre Energy to benefit from revenue linked to the high flexibility value of the asset, while also guaranteeing a base level of income. This is supported by the anticipated rapid growth in renewable generation capacity and Eneco's requirements for flexible energy sources to deliver its target of becoming climate-neutral by 2035.

This type of facility will be an essential element, in conjunction with other energy storage solutions, in providing the flexibility required to prevent grid congestion in the Netherlands, and to ease the supply/demand balancing challenges associated with the transition from fossil-fuel generation to long-term sustainable renewable sources, such as wind and solar. CAES works alongside smaller, shorter duration lithium-ion battery installations, to cover longer duration renewable downtime, offering balancing solutions within-day and across multiple days.