The facility, located around 90km west of Stockholm, should be operational at the end of next year, the companies said in a joint statement on Monday.
Under the letter of intent, the facility will provide services for TSO Svenska Kraftnat's balancing markets and enable the withdrawal of an additional 100 MW from the local grid, the statement added.
Polar Capacity previously started a joint venture with district heating supplier Stockholm Exergi to build a 100 MW battery storage unit south of the Swedish capital.
