TransAlta Corporation is to acquire a 50% interest in the Tent Mountain Renewable Energy Complex, an early-stage 320MW pumped storage hydropower development project, located in southwest Alberta, currently owned by Montem Resources Limited.
Under a deal announced last week, TransAlta and Montem have agreed to form a partnership to jointly manage the closed-loop pumped storage project, with TransAlta acting as project developer. The acquisition includes the land rights, fixed assets and intellectual property associated with the pumped storage development project.
The project leverages Montem’s existing assets at Tent Mountain, which include large legacy water reservoirs from past mining operations. The characteristics of the Tent Mountain site are rare and present a unique opportunity to provide 15 hours of energy storage capability for the Alberta market. The project is strategically located on private, industrial zoned land, including an existing upper reservoir that supports a cost competitive pumped hydro project compared to other similar projects. The project has already completed key technical and environmental work including a hydrology assessment, with additional geotechnical analysis being planned in 2023 to further advance the design of the project.
The project will be developed over the next four years, with construction targeted to start as early as 2026 with a commercial operation date between 2028 and 2030, all subject to regulatory, commercial and engineering considerations.
“The Tent Mountain Renewable Energy Complex is a unique development opportunity for our Company and the Province of Alberta,” commented John Kousinioris, President and Chief Executive Officer of TransAlta. “The project can support the reliability of the Alberta grid with a proven technology that is non-emitting and has a significantly larger capacity and duration than other currently available storage options. We believe long duration storage projects, like Tent Mountain, are essential to support the reliability of the grid in Alberta as wind and solar penetration increase on the path to net-zero electricity.”
“We are thrilled to be entering into this partnership with TransAlta to develop the Tent Mountain Renewable Energy Complex,” added Peter Doyle, Managing Director and Chief Executive Officer of Montem. “TransAlta has been operating in the Alberta power market for more than 110 years and brings many skill sets which are complementary to Montem’s.”
TransAlta will pay Montem approximately $8 million upon closing the transaction with additional payments of up to $17 million (approximately $25 million total) contingent on the achievement of specific development and commercial milestones. The acquisition also includes the intellectual property associated with a 100MW offsite green hydrogen electrolyser and a 100MW offsite wind development project. The closing of the transaction remains subject to customary closing conditions, including receipt by Montem of shareholder approval, with closing expected to occur in March 2023.
The project will be independent of TransAlta’s existing Alberta hydro assets and will be managed through this partnership.
