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American Electric Power has agreed to buy up to 1.6 GW of Mainspring Energy’s linear generators over the next eight years, with an initial 190-MW delivery set for next year, the Menlo Park, California-based company said Tuesday.
Under the agreement, which could be worth up to $4 billion, AEP will be able to buy about 200 MW a year, with the linear generating units expected to be online within 12 months, Tom Linebarger, Mainspring chairman and CEO, said Tuesday in an interview with Bloomberg Tech.
The dispatchable generating units, which can use different fuel sources, such as natural gas, biogas and hydrogen, offer AEP flexibility, including by potentially firming renewable energy, according to Linebarger.
“Having the ability to both react to the customers' needs and the grid's needs at the same time gives them incredible flexibility,” Linebarger said. “Of course, the speed to power means [AEP] can deploy them quickly where they need them to serve customers better.”
The transaction is Mainspring’s largest purchase order to date, and marks a shift into the investor-owned utility market beyond commercial, industrial and data center markets, the company said.
Mainspring’s linear generators come in standard 2.5-MW configurations. They convert fuel into electricity through a low-temperature, flameless reaction that produces close to zero nitrogen oxide emissions, according to the company.
Mainspring, founded in 2010, recently closed on a $242 million Series G round led by private equity firm Valiant Peregrine, with participation from all existing company investors and a new strategic backer, according to a company spokeswoman. The company has raised a little more than $1 billion through all its funding rounds, she said in an email to Utility Dive.
Mainspring’s investors include AEP, NextEra Energy, Gates Frontiers Fund, Khosla Ventures and others.
AEP advances Wyoming fuel cell project
Meanwhile, AEP on Wednesday said it plans to spend about $4 billion building a 702-MW fuel cell generation project near Cheyenne, Wyoming, under a 20-year power purchase agreement with Google. AEP plans to use Bloom Energy fuel cells for the project.
AEP expects to start building the project this year and bring it online in 2028.
Bloom’s fuel cells produce electricity without burning natural gas, and the project includes plans for carbon capture technology for near-zero-emissions power, AEP said. The project follows agreements reached between Google and Black Hills Corp., which owns a utility serving the Cheyenne area, effective Sept. 30, according to AEP.
Under the PPA, Google will buy power from Cheyenne Fuel Cell, which is about 92% owned by AEP, with funds advised by Basalt Infrastructure Partners owning the remaining share, the utility company said.
“As power demand continues to grow, AEP is bringing together new technologies and strong partnerships to deliver reliable, innovative energy solutions quickly and at scale,” Bill Fehrman, AEP chairman, president and CEO, said in the press release.
The Wyoming project shows how AEP is expanding beyond its traditional utility service territory, he said.
AEP’s utilities have about 5.6 million customers in Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia and West Virginia.