Helping to achieve stable renewable energy supply and regional carbon-neutral society
KS Energy and Hitachi have agreed to collaborate on the development and operation of an Extra-High Voltage Grid Battery Energy Storage System within Kumamoto Prefecture, as well as the development and operation of power trading businesses
Hitachi will provide project development support for KS Energy’s development of the project and will jointly promote the development and operation of this battery energy storage system. KS Energy will also explore the introduction of a power trading support system planned for development by Hitachi.
The initiative will support a stable power supply in the Kyushu region and help achieve carbon neutrality.
Background
Weather changes and other factors can cause fluctuations in renewable energy generation, impacting the power supply-demand balance. Particularly in the Kyushu region, where renewable energy adoption is advancing, output curtailment frequently occurs when generation exceeds demand, so balancing power to stabilise the power grid is an urgent priority.
As the policy framework for promoting renewable energy shifts from the Feed-in-Tariff (FIT) system to the Feed-in-Premium (FIP) system, power generators are required to develop their own electricity trading capabilities to formulate strategies for selling electricty in the power market.
This has meant that “aggregators”, entities that consolidate and control energy resources to adjust supply-demand balance, is growing in importance. They are expected to contribute to the utilisation and stable supply of renewable energy by engaging in the electricity and power trading markets.
To address this, KS Energy has adopted a policy to contribute to stabilising power supply as a regional energy company, setting out to make the Kyushu region a leading area for renewable energy circulation. Hitachi also has a long history in the power sector, providing a range of advanced solutions from energy storage systems to transmission and distribution infrastructure and grid protection devices.
Through this collaboration, both companies will combine their strengths to develop and operate energy storage facilities and engage in power trading to help achieve carbon neutrality in the Kyushu region.
Initiative Details
Together, KS Energy and Hitachi will develop and operate a battery energy storage system in the Kyushu region. This initiative will help to stabilise local power supply by charging and discharging in response to the electricity demand-supply balance.
Nation’s First BESS project launched by regional bank group
This marks the first nationwide instance of a bank subsidiary’s renewable energy business undertaking a grid energy battery business in the extra-high-voltage range, as KS Energy was established with full investment from Higo Bank (part of the Kyushu Financial Group). KS Energy is also considering managing the power trading for the storage facility in-house. The plan involves handling the entire operational process, including forecasting electricity market prices, creating power generation plans for the batteries, controlling the storage facility, and monetising through market transactions.
In the future, utilising its operational expertise in storage facilities and collaborating with Higo Bank, KS Energy will enhance support for power generators and offer financing support to storage facility developers. This will facilitate the delivery of services beyond the financial sector, promote efficient electricity use within local communities, and contribute to achieving carbon neutrality and decarbonisation in the region.
Joint Promotion of Project Development
Leveraging Hitachi’s experience in battery energy storage systems, Hitachi and KS Energy will promote the development of energy storage facilities. The Hitachi Group will promote project development through to operational launch, which includes cooperation in grid connection application discussions with transmission and distribution operators; applications and procedures with relevant ministries and agencies; provision of business feasibility evaluation information; supply of Hitachi Energy-manufactured PCS; and project management covering equipment design, procurement, and installation.
Collaboration in Power Trading
To stably use rapidly expanding renewable energy, the need for aggregation functions that balance electricity supply and demand is growing. KS Energy is considering introducing Hitachi’s planned power trading support system to improve the efficient utilisation of energy resources and achieve a stable power supply.
Under Hitachi’s Lumada 3.0 initiative, the company is deploying “HMAX by Hitachi”, a next-generation AI solution suite capable of tackling complex challenges facing social infrastructure. This is possible by combining data from physical and digital assets with advanced AI enhanced by Hitachi’s deep domain knowledge. In the electric power trading area as well, Hitachi will realise services that optimise the operation of battery storage assets and maximise market value, aiming to deploy them as HMAX.
