Siemens, AES to form energy storage JV

German engineering group Siemens AG (ETR:SIE) and US power company AES Corp (NYSE:AES) have agreed to form a 50/50 energy storage joint venture, called Fluence, to better serve the growing global energy storage market.

The move combines AES' experience in deploying more than 200 MW of energy storage in seven countries with Siemens' energy technology expertise and its sales presence in more than 160 countries. The companies are bringing together their AES Advancion and Siemens Siestorage energy storage platforms to provide customers with "an industry-leading suite of choices," they said in a joint press release.

"Partnering with Siemens to form Fluence will offer both large and small customers the full gamut of proven, state-of-the-art energy storage solutions in over 160 countries," said AES president and chief executive Andres Gluski. "This will accelerate the integration of renewables into the energy network of tomorrow," Gluski added.

AES is a specialist in utility-scale battery-based energy storage for flexible peaking capacity, ancillary services and renewable integration, while Siemens has experience in microgrid and islanding applications, renewable hybrid technology, black-start capability and consumer peak shaving.

The companies cited IHS Markit projections, according to which the grid-connected energy storage sector will grow from 3 GW of installed capacity at the end of 2016 to 28 GW by 2022. Currently, AES and Siemens are among the major energy storage integrators and together have deployed or been awarded 48 battery-based projects totaling 463 MW in 13 countries.

The joint venture will be based in Washington, DC. The deal is expected to close in the fourth quarter of 2017.

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