NatPower, Tesla reach deal on first phase of $5 billion battery storage plan

By Simon Jessop and Susanna Twidale

LONDON, June 23 (Reuters) - Independent energy firm NatPower and Tesla said on Tuesday they had reached a deal to build 25 gigawatt hours of battery storage in Italy and Britain, the first phase of a project worth up to $5 billion.

Countries across Europe are ramping up battery storage projects to help balance the rollout of intermittent renewable power capacity.

Under the multiyear agreement, NatPower will use Tesla's Megapack battery storage system.

NatPower will also use Tesla's trading technology,  which manages when to buy and sell electricity.

Five initial projects will be built, the first phase of a programme that ultimately aims to exceed 100 GWh of storage capacity, at a construction cost of $4 billion to $5 billion, the companies said. They added that revenue will potentially exceed $15 billion over 20 years.  

"The sector has access to technology and capital but still struggles to deliver infrastructure consistently and within the required timelines. What we have built with Tesla is an ecosystem that enables alignment between capital and execution, and that can be replicated across multiple markets," said Fabrizio Zago, CEO of NatPower.

(Reporting by Simon Jessop in LondonEditing by Matthew Lewis)