Energy Storage News
A debt financing deal closed by independent power producer (IPP) sPower for a 100MW / 400MWh battery storage project in California demonstrates that significant project finance investment can be achieved for large-scale battery facilities.
The non-recourse debt raise was arranged by a group of three private financial institutions: KeyBank Capital Markets, Credit Agricole Corporate and Investment Bank and Silicon Valley Bank, together with Canada’s state-owned export credit agency Export Development Canada. sPower has a 15-year Energy Storage Agreement (ESA) in place with electricity provider Clean Power Alliance, a Community Choice Aggregator (CCA).
California’s CCAs operate in the service areas of the state’s large investor-owned utilities. In CPA’s case that is Southern California Edison (SCE). CPA gets to use SCE’s electricity network to deliver power to its three million customers, but also gets to choose where its power is generated. Since CPA was formed in 2017 with a central mission to offer renewable energy and help lower emissions and pollution for the communities it serves, it is buying more renewable energy. In November, it signed a power purchase agreement (PPA) with sPower for output from Estrella, a 56MW solar and 28MW / 112MWh battery energy storage project, which carried on a prolific run of similar deals for CPA that Energy-Storage.news has reported on.
The agreement will enable CPA to use the Luna Storage facility to help integrate bigger shares of variable renewable energy onto its networks and reduce reliance on local natural gas power plants scheduled to be closed down. From sPower’s side, the agreement also appears to have been instrumental in allowing it to find the non-recourse debt financing it needed.