EllisDon announced it partnered with Cache Power to deliver what it calls Canada’s first commercial scale compressed air energy storage project in northeast Alberta, next to the Marguerite Lake substation. The partners say early construction will begin in the fourth quarter of 2025, after receiving major regulatory approvals.
Compressed air energy storage, or CAES, stores electricity by compressing air into underground caverns, then releases it to spin turbines when demand rises. The site is billed as long duration storage that can run for up to 48 hours, aimed at smoothing renewable output and firming supply on Alberta’s grid.
EllisDon framed the project as a step toward a net‑zero power system, citing lower expected capital costs than other long duration options, and a multi‑phase build to manage risk and timing.
Two phases, 48 hours storage
Project plans call for a 640 MW facility built in two identical 320 MW phases, with air stored in solution‑mined salt caverns close to the substation. The configuration targets 48 hours of discharge, which is designed to address multi‑day supply gaps that short duration batteries cannot cover. It is not a battery.
The Marguerite Lake siting allows direct tie‑in to existing transmission, which can cut losses and limit new line work. While EllisDon did not publish a commissioning schedule, the early works timeline points to site preparation in late 2025 and staged construction thereafter. Capacity details were outlined by a project supplier in late October.
Alberta’s energy‑only market pays generators for electricity produced, not for capacity held in reserve, which can make long duration storage valuable during price spikes and calm wind periods. CAES can absorb power when prices are low, then generate during peak hours, which may dampen volatility and reduce curtailment of wind and solar. EllisDon is positioning the project as grid support as renewables scale in the province.
“This project proves the confidence in long‑duration storage,” said Joey Comeau, Chief Operating Officer and Executive Vice President, Capital, at EllisDon. The release also says no comparable storage project of this duration currently operates in Alberta.
Hydrogen blend and local partners
The design includes reheating compressed air with natural gas, with the option to blend up to 75 per cent hydrogen, and a pathway to full hydrogen use over time. Engineering work with Babcock and Wilcox contemplates on‑site hydrogen production and a carbon capture pathway tied to its BrightLoop technology, which the supplier says can generate up to 60 tonnes of hydrogen per day and produce a nearly pure stream of carbon dioxide for storage.
Those features, if adopted, would aim to shrink emissions during generation and create a future low‑carbon fuel supply on site. Project developers also point to provincial support for early‑stage work, including C$5 million from Emissions Reduction Alberta, to advance studies toward a final investment decision. Cold Lake First Nations has taken an active role in development and is expected to participate as a partner during construction and operations, according to EllisDon.
Siemens Energy technology underpins the compression and expansion trains planned for the facility, drawing on equipment widely used in industrial settings. The supplier called the step a move from pilot to daily service.
“This partnership is an important step toward storing and re‑using energy reliably,” said Tobias Panse, a senior vice‑president at Siemens Energy.
If built as outlined, the project would add a new storage class to Alberta’s grid mix, alongside batteries and pumped hydro proposals. For corporate Canada, the tie‑up signals construction and engineering firms are leaning into long duration storage as renewable buildouts continue.
