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Plus Power Secures $1.8 Billion for US Battery Storage Projects

Learn how Plus Power LLC secured $1.8B for their groundbreaking US battery storage projects to bolster the national grid with renewable energy.

Posted by Staff

October 17, 2023

3 Min Read
Construction is 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 $707M. Courtesy of Plus Power

Plus Power LLC—a company that develops and operates utility-scale energy storage projects—announced the completion of $1.8B in new financing for standalone battery storage, including the largest single such project financing to help stabilize the US electrical grid while incorporating more solar and wind energy.

Today's announcement includes Plus Power's $707M financing for the 250MW Sierra Estrella Energy Storage facility in Avondale, Arizona, west of Phoenix. It will be the largest to date for a standalone energy storage project. The 11-acre footprint of the Sierra Estrella project allows the project to be sited without attached generation, closer to load.

The announced transactions also support the construction of 700MW 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.

For example, as this year's summer heat waves triggered record demand for electricity, Plus Power's existing 100MW Gambit Energy Storage facility in Angleton, Texas, repeatedly provided energy and ancillary grid services (such as regulation up and down, contingency reserve, and frequency response) to help grid operators stabilize the power system and avert a blackout.

The financing commitments announced today cover five projects totaling 1,040MW of capacity (or 2,760 MWh). The transactions will support the portfolio's construction and operations, including construction financing, term financing, letters of credit, and tax equity investments in partnership with 11 leading industry lenders and investors.

The size and breadth of the financing by leading institutions – and the projects' geographic and revenue structure diversity – highlights the variety of services and value that well-sited standalone energy storage can offer power markets.

“Over the last year, Plus Power has raised an unparalleled amount of capital for standalone storage projects from a wide range of leading energy project finance banks and investors," stated Josh Goldstein, chief financial officer of Plus Power. "This capital will support the ongoing buildout of the largest and most diverse portfolio of standalone storage projects in the US. The scale highlights our first-mover advantage in bringing high-quality projects to market as well as the tremendous work by our fantastic team." 

Goldstein added, "We deeply value our financing partners who support the construction and operation of our wide portfolio across the U.S., enabling decarbonization and the transition to a more efficient grid."

The completed transactions included construction, term, and tax equity financings totaling $884M on three new standalone storage facilities in Texas. They bring Plus Power's 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. as the joint lead arranger. They include:

  • $212.2M of tax equity financing from Foss & Company and $276 million of construction and term financing for the 300 MW / 600 MWh Rodeo Ranch Energy Storage facility in Pecos.

  • $196M of construction and term financing for the 200 MW / 400 MWh Ebony Energy Storage Facility in Comal County, northeast of San Antonio.

  • $200M 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 $903M and 340 MW / 1,360 MWh. Both projects have 20-year energy storage services agreements with the Salt River Project. They are under construction, aiming to be online by the second quarter of 2024 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:

  • $202M 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.

  • $196M construction, term loan, and letter of credit facility for the 90 MW / 360 MWh Superstition Energy Storage project in Gilbert, southeast of Phoenix.

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