Tesla, Japanese firms to build energy storage facility in Hokkaido

TOKYO, Aug 19 (Reuters) - Tesla Inc said on Thursday it will join hands with Japanese companies to build an energy storage facility using its rechargeable battery in Hokkaido in northern Japan to help stabilise the power system in the wake of rising renewable energy use.

The U.S. company will collaborate with Japanese power retailer and aggregator Global Engineering and engineering firm Ene-Vision to build the energy storage facility connected to the grid with 6,095 kilowatts hour (kWh) capacity that could power about 500 homes.

Tesla will supply its Megapack battery technology for the project, which is due to start operating in summer 2022.

Global Engineering will be the operator, selling power to the wholesale electricity market, balancing market and capacity market, while Ene-Vision will handle engineering, procurement and construction.

The project is estimated to cost around 300 million yen ($2.7 million), according to an official at Global Engineering.

It aims to help further expansion of renewable energy and to reduce costs by absorbing fluctuations and stabilising output through the use of generators and storage batteries, Global Engineering said.

($1 = 109.5200 yen)

(Reporting by Yuka Obayashi; Editing by Bernadette Baum)

((Yuka.Obayashi@thomsonreuters.com; +813-4520-1265;))