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NineDot Lands Carlyle Investment for New York Battery Projects

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NineDot Lands Carlyle Investment for New York Battery Projects

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David Arfin, a US rooftop solar pioneer, is developing a dozen basketball-court-sized electric battery sites in New York City with a recent investment from the Carlyle Group Inc.

CG -1.31%

Carlyle bought a stake in Mr. Arfin’s company, NineDot Energy, as it expands into the large-scale electricity storage market, an area of ​​growing interest for fund managers. The private equity giant spent more than $100 million in December on separate investments in NineDot and Fermata Energy, a provider of technology that enables parked electric vehicles to pump energy from their batteries into local power grids.

The investments are notable as both companies are in their infancy. NineDot plans to complete its first battery installation in New York in May, and although Fermata maintains relationships with automakers, relatively few vehicles currently use its products.

NineDot’s projects are eligible for government grants and contribute to New York State’s plan to boost electricity storage so it can achieve a 100% clean energy goal by 2040. Governments are increasingly focusing on batteries because the wind and sun that produce most renewable energy are intermittent. , leaving power grids vulnerable to shortages.

“Energy storage is extremely valuable to the grid of the future because of the reliability advantages it provides,” said Doreen Harris, president of the New York State Energy Research and Development Authority. “We know we need more storage than we have.”

New York Governor Kathy Hochul said this month the state would double its 2030 energy storage goal to 6,000 megawatts. The state has 130 megawatts of energy storage currently operational and 1,240 megawatts under contract, a NYSERDA spokeswoman said.

Mr. Arfin founded NineDot in 2015 after working at SolarCity Corp., where he developed the company’s popular leasing for rooftop solar panels. The startup started expanding in New York because the city lacks space for power generation and developers there have incentives.

NineDot purchases small lots of land in New York’s outer boroughs, then works with the local utility to connect the batteries at the sites to the grid and find local buildings or businesses to purchase the power. He is also working with Fermata on a project for all-electric carpooling company Revel Transit that would allow its fleet to sell electricity to the local grid when not in use.

Fermata specializes in two-way charging technology for vehicles that allows their owners to use the cars’ energy in their homes or resell it to utility companies. Fermata works with Nissan Motor Co.

ltd. and Ford Motor Co.

and markets software for optimal management of the consumption and power supply of electric vehicles.

“The next phase of the energy transition is integrating renewables and the impact that will have on grid infrastructure,” said Pooja Goyal, chief investment officer of Carlyle’s infrastructure group. The company favors projects in areas like New York, where governments have already implemented supportive policies, she said.

Carlyle has invested about $1.2 billion in renewable energy projects over the past two years, a company spokeswoman said.

Money is a sticking point in global climate change negotiations. As economists warn that limiting global warming to 1.5 degrees Celsius will cost many more billions than expected, the WSJ examines how the funds could be spent and who would pay. Illustration: Preston Jessee/WSJ

Write to Matt Wirz at matthieu.wirz@wsj.com

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NineDot Lands Carlyle Investment for New York Battery Projects

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