Colorado business seeks tax abatement on Indy battery storage project
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A Colorado energy company is seeking a five-year, $3.6 million tax abatement to build a battery farm in Pike Township in Indianapolis that it says will help stabilize electricity supply and prices during peak demand hours.
Peregrine Energy Solutions, based in Boulder, Colorado, told the Metropolitan and Economic Development Committee of Indianapolis City-County Council on Monday evening that the battery farm would store electricity during times when there’s excess power on the grid and then discharge the energy back into the grid during times of peak demand.
“Most of the time, what we see is that peak demand window is late afternoon, early evening, when everybody’s getting home from work, kids are getting home from school, you’re turning on the air conditioning in the summer, heat in the winter,” project manager Kevin Conger told the committee. “And when everybody in a community is doing that, it causes the energy demand to spike. … So battery energy storage is really where you rely on that energy, other than having massive price spikes.”
The two-year-old startup, backed by private equity firm KKR of New York City, wants to build the development on about 15 acres of land at 4025 W. 86th St. It is buying the land from Ascension St. Vincent Hospital, located at 2001 W. 86th St. The site is about two miles west of the hospital.
Peregrine initially plans to invest $144 million in the project, which will consist of several dozen lithium-ion phosphate batteries housed in containers about 10 feet tall.
The proposal does not include any new jobs, as the development is highly automated. Peregrine will monitor the site remotely.
Conger said the company is in its early stages, and it has not yet completed any similar projects, although several are under way.
The plan calls for Peregrine to connect the development to an AES Indiana substation on the site, and from there to the grid.
The company is seeking a 5-year, 51% tax abatement on equipment on the site. The savings would start at $1.1 million in the first year and decrease each year to $513,940 in the fifth year. Peregrine is not seeking an abatement on the real estate. The company hopes to begin construction in early 2027.
The committee voted unanimously Monday to advance the tax abatement request to the full council, which will consider it at its Dec. 2 meeting.
Many councilors spoke highly of the project, which they said could stabilize electricity prices and help the local community. Several councilors asked about environment impact and the possibility of fire issues. Conger pointed out the likelihood of explosion is very low, and a fire station is nearby in case of emergency.
He added the the environmental impact is minimal, as the project would have no exhaust, no emissions and no runoff. The company said it plans to preserve as many trees as possible on the wooded site.
Councilor Leroy Robinson, whose district includes the Peregrine development, said he met with the company several months ago and he supports the project.
“I just wanted to say I’m really excited about the project,” Councilor Jared Evans said. “In fact, if you guys are looking for another location, talk to me. I’ve got some spaces in my district. This is the future in my eyes.”