Ormat moves into storage, demand management with $35M Viridity acquisition
Ormat Technologies is moving into energy storage and demand management with an agreement to acquire substantially all of the business and assets of Viridity Energy.
The deal calls for an “initial consideration” of $35 million with the possibility of further payments if future milestones are met in 2017 and 2020.
The acquisition gives Ormat a platform to expand its project development experience into the development of virtual power plants.
Ormat’s expertise is in renewable energy, particularly geothermal power projects, but the Nevada-based company got its feet wet in storage in March with project in Georgetown, Texas, with Alevo Group. Together they will build own and operate the 10 MW Rabbit Hill energy storage project there.
Ormat is now taking a much bigger step into energy storage, demand response and energy management with the planned Viridity acquisition.
Privately-held Viridity has more than 850 MW under contract, including management of a portfolio of non-utility storage assets in the northeastern U.S. with over 80,000 operational market hours. The Philadelphia based firm primarily serves retail energy providers, utilities, and large industrial and commercial clients by using its software to serve as an interface between clients’ energy management, demand response and storage facilities and regional wholesale markets.
In May, Viridity raised $8.5 million from AltEnergy, an investment firm interested in early-stage opportunities in grid edge technologies, to expand its virtual power plant software.
Ormat CEO Isaac Angel called the agreement with Viridity “an important strategic acquisition” that combines Viridity’s expertise in the demand response and energy storage with Ormat’s project development skills and access to capital.
“Ormat intends to use the Viridity platform to accelerate long term growth, expand its market presence, and further develop Viridity’s demand response VPower software platform and energy storage services,” Angel said in a statement.
Viridity was founded in 2008 by Audrey Zibelman and Ed Krapels. Krapels, a former analyst with Energy Security Analysis, is now head of microgrid and transmission developer Anbaric.
Zibelman was formerly the COO of the PJM Interconnection and is the current chairwoman of the New York Public Service Commission. Her role at the PSC led to a public inquiry that resulted in her giving up her remaining shares in Viridity.
The Ormat-Viridity acquisition is expected to close early this year.
Correction: A previous version of this article incorrectly stated Viridity raised $8.5 million from Constellation to expand its virtual power plant software. The company raised that amount with AltEnergy, an investment firm targeting early-stage development in grid edge technologies.
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