Ormat Technologies Inc. announced the successful start of commercial operations at its new Lower Rio Battery Energy Storage System (BESS) in Texas. The 60 Megawatts (MW)/120Megawatt-hours (MWh) facility strengthens Ormat’s presence in the U.S. energy storage market and supports the company’s long-term growth strategy.
Located in a key Texas energy hub, the Lower Rio project will provide energy and ancillary grid services under a seven-year tolling agreement, offering Ormat stable and predictable revenue. The facility increases Ormat’s total U.S. energy storage capacity to 350MW/778MWh.
“This achievement highlights our commitment to expanding our Energy Storage portfolio in key U.S. markets and demonstrates our continued leadership in both energy storage and geothermal energy production,” said Doron Blachar, CEO of Ormat Technologies. “The tolling agreement will provide Ormat with fixed, long-term revenues and further reduce risk in our expanded Texas storage portfolio, aligning with our long-term plan to improve segment profitability and accelerate growth.”
In parallel, Ormat also announced a Hybrid Tax Equity partnership with Morgan Stanley Renewables, Inc. to monetize the 40% Investment Tax Credit (ITC) for the Lower Rio project. The transaction delivered approximately $25 million in proceeds, marking significant progress toward Ormat’s 2025 goal of monetizing $160 million in tax benefits.
The successful commercial operation and tax equity financing reinforce Ormat’s strategic focus on growing its energy storage footprint alongside its legacy geothermal and recovered energy generation (REG) operations.
With over 60 years of experience, Ormat remains the only vertically integrated company engaged in both geothermal and REG power generation. Its current total global generating portfolio stands at 1,618MW, including 1,268MW of geothermal and solar capacity and 350MW of energy storage capacity concentrated in the U.S.
