Arizona Public Service (APS), the state’s largest utility, has received a conditional commitment for a loan guarantee of up to $1.81 billion from the U.S. Department of Energy’s (DOE) Loan Programs Office (LPO). The funding will support APS’s efforts to enhance grid reliability, expand renewable energy generation, and integrate energy storage systems, positioning the utility to meet rising demand while reducing emissions.

A key project backed by this loan is the Agave Battery Energy Storage System (BESS) in Maricopa County. This 150-megawatt, 600-megawatt-hour energy storage facility will help stabilize the grid by storing excess renewable energy and providing backup power during peak demand. Located next to an existing solar site, the Agave project is a significant step in APS’s strategy to incorporate more renewable energy into the grid.

In addition to the Agave project, APS has secured a 20-year agreement with the Papago Storage Project, slated to become Arizona’s largest standalone energy storage system when it begins operations in 2025.

Future initiatives funded by the loan could include further BESS installations, new renewable generation projects, and transmission upgrades. These investments are designed to reduce overall grid costs, increase reliability, and provide savings for APS customers.

APS has set ambitious goals to transition to 100% clean, carbon-free electricity by 2050, with interim renewable energy targets of 45% by 2030. As part of its commitment to sustainability, APS is also working on community transition plans, offering financial support to affected Tribal communities as it phases out coal generation.

Source:power-grid.com