Hydrostor’s $1.5B Willow Rock Project Faces Permit Hurdles —but Could Revolutionize California’s Power Grid

Hydrostor, Canada’s leading developer of long-duration energy storage projects, is moving ahead with its $1.5 billion Willow Rock Energy Storage Center in Kern County, California. The project uses compressed air to store renewable energy and will deliver 500 MW of power for up to eight hours. It’s almost 2X that of most lithium-ion battery systems can sustain. If completed, it would mark the first compressed air energy storage (CAES) facility built in the U.S. in more than 30 years.

S&P Global recently provided an update regarding its permit processes for the Willow Rock Energy project. It is working to complete California’s permitting process by 2025 to qualify for federal clean energy tax credits and secure the $1.76 billion conditional loan guarantee from the U.S. DOE, which was announced on January 8. The loan includes roughly $1.5 billion in principal and about $280 million in capitalized interest. However, delays from the California Energy Commission (CEC) are putting that goal at risk.

Permit Delays Threaten Hydrostor’s Project Timeline

On April 15, the CEC released its fourth revised schedule. It pushed the preliminary staff assessment to April 30 and rescheduled evidentiary hearings to August 18–19. Although the commission still targets a final decision by December, regulators admitted during an April 14 meeting that the timeline is uncertain.

Despite the setbacks, Hydrostor’s senior vice president, Curt Hildebrand, said the company is fully committed to the updated schedule and hopes for a decision before the end of the year. Still, Hydrostor’s legal team warned in an April 9 filing that more delays could derail their 2025 construction plans.

Federal Incentives at Risk

Another challenge that they might encounter is the impact of amendments to the Federal clean energy tax policies under the new Trump administration. The Biden-era DOE loan guarantee for Willow Rock is now under review by the current government. Additionally, a Republican-led Congress is debating whether to repeal or weaken clean energy tax credits.

Despite these risks, Hydrostor is actively informing lawmakers about the benefits of long-duration storage. Executive VP Scott Bolton emphasized the project’s role in grid reliability, clean tech innovation, and job creation.

Hydrostor first applied for the project permit in December 2021 and aimed to start full operations by 2028. Now, the company expects Willow Rock to go online in 2030.

So far, it has secured a 25-year contract with Central Coast Community Energy for 200 MW of capacity. They are still negotiating deals for the remaining output. To date, Hydrostor has raised $520 million from 18 investors. Its most recent $200 million round in February included backing from Goldman Sachs Alternatives, Canada Pension Plan Investment Board, and Canada Growth Fund Inc.

• READ MORE: CRC Launches California’s First Carbon Capture Project for Emissions Reduction

Willow Rock Is Set to Supercharge California’s Clean Energy Goals

The Willow Rock Energy Storage Center project will store clean energy by using compressed air, water, and renewable power. Unlike the only other U.S. plant in Alabama that burns gas, Willow Rock will store energy without any fossil fuels.

Take a look at its proprietary Advanced CAES facility:

Clean Energy, Good Jobs, and a Strong Local Boost

California is upgrading its power grid and reducing carbon emissions fast. The project will power homes for over 50 years and support the shift to a greener future.

Hydrostor plans to hire more than 700 workers for construction and $500 million into the local economy. It uses proven technology and offers stable jobs for workers already skilled in the region’s oil and gas industry.

Once charged, Willow Rock can deliver 500 megawatts and store 4,000 megawatt-hours of electricity.

Turning Solar and Wind into Steady Power

California gets a lot of sun and wind. But that energy doesn’t always show up when people need it. Willow Rock is designed to fix that by storing extra energy from places like the High Desert and Tehachapi. This energy can then be released during high-demand hours, like in the evenings.

As per EIA, California’s renewable electricity net summer capacity reached 41,733 megawatts by December 2024, accounting for 11.3% of the entire U.S. total. In the same period, 12.8% of all energy consumed in California came from renewable sources.

Big Wins for the Power Grid

• More reliable electricity: Willow Rock will send out power when solar and wind aren’t enough.
• Better use of power lines: It will store energy when there’s too much and send it out when needed, helping the whole grid run smoother.
• Adds tech variety: Unlike batteries, A-CAES brings a different kind of storage — one that lasts longer and stays strong over time.
• Eco-friendly choice: The system doesn’t burn anything, uses very little land and water, and produces almost no waste.

By replacing old fossil-fuel backup plants, Willow Rock will help California hit its climate goals. It supports the state’s target to cut emissions 40% below 1990 levels by 2030 and to reach 100% renewable power by 2045.

As Hydrostor receives the permit and the desired amount of loan we expect it will be all set to revolutionize California’s clean energy future.

• SEE MORE: Is the Battery Boom Heating Up? California Leads the Charge!

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