Grid Scale

Plus Power secures $1.8B in financing for standalone battery storage projects

Plus Power secures $1.8B in financing for standalone battery storage projects
Construction underway at the Sierra Estrella Energy Storage project in Avondale, Arizona, which just received the largest financing package for a single standalone energy storage project, worth $707 million. (Courtesy: Plus Power)

Plus Power has secured $1.8 billion in new financing to support the development of five standalone battery storage projects in Texas, including what the company called the largest single project financing to date.

Eleven financial institutions supported the fundraising haul. The financing commitments cover five projects totaling 1,040 MW of capacity (or 2,760 MWh). Plus Power, a developer, owner, and operator of standalone battery storage assets, said the funds will support construction and operations.

The announcement includes Plus Power’s $707 million financing for the 250 MW Sierra Estrella Energy Storage facility in Avondale, Arizona, west of Phoenix. Plus Power said the deal is the largest to date for a standalone battery storage project.

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The announced transactions are also supporting construction of 700 megawatts of batteries on the ERCOT grid in Texas. Three new Plus Power battery plants will begin operation by next summer to handle increased demand amid increasingly extreme temperatures and numerous days of scarce operating reserves on the power grid.

Among the completed transactions were construction, term, and tax equity financings totaling $884 million on three new standalone storage facilities in Texas. They bring Plus Power’s current ERCOT portfolio to 800 MW, or 1,575 MWh. Deutsche Bank and First Citizens Bank were the coordinating lead arrangers, with First Citizens Bank as the administrative agent and Siemens Financial Services, Inc. acting as the joint lead arranger. They include:

  • $212.2 million of tax equity financing from Foss & Company, as well as $276 million of construction and term financing, for the 300 MW / 600 MWh Rodeo Ranch Energy Storage facility in Pecos.
  • $196 million of construction and term financing for the 200 MW / 400 MWh Ebony Energy Storage facility in Comal County, northeast of San Antonio.
  • $200 million of construction and term financing for the 200 MW / 400 MWh Anemoi Energy Storage facility in Hidalgo County, on the Mexican border northwest of Matamoros.

While the Ebony and Anemoi projects are expected to operate as merchant resources in the ERCOT wholesale market, Plus Power executed an innovative hedge for Goldman Sachs’ commodities group for a portion of the Rodeo Ranch Energy Storage facility.

The Sierra Estrella project was one of two Plus Power landmark project financings in Arizona that totaled $903 million and 340 MW / 1,360 MWh. Both projects have 20-year energy storage services agreements with Salt River Project and are under construction, aiming to be online by the second quarter of 2024 in time for another summer of anticipated record peak demand. Norddeutsche Landesbank and Société Générale acted as coordinating lead arrangers while Mizuho, U.S. Bank, Bank of America, CoBank, and Siemens Financial Services, Inc. were joint lead arrangers. The financings include:

  • $202 million of tax equity for the 250 MW / 1,000 MWh Sierra Estrella Energy Storage facility in Avondale from Bank of America, coupled with a $505 million construction, term loan, and letter of credit facility.
  • $196 million construction, term loan and letter of credit facility for the 90 MW / 360 MWh Superstition Energy Storage project in Gilbert, southeast of Phoenix.