Enlight locks in debt for US BESS

Clenera Holdings, the American offshoot of Israeli developer Enlight Renewable Energy, locked in terms for $407 million (£311m €369m) in debt and tax equity contribution to finance the development of the battery storage element of its flagship Atrisco complex located outside Albuquerque, New Mexico.

The 1.2GWh battery energy storage system (BESS) has a CapEx of $459 million, which will be financed using:

• term loan - $185 million
• upfront tax equity contribution - $222 million
• equity from sponsor - $52 million

The term loan was arranged by a consortium of eight lenders led by HSBC. It's a five-year mini-perm with a 20-year underlying amortisation profile.

This tranche is priced at 30 bps – 60 bps over the Federal Funds Reserve Rate, which currently stands at an average of 530 bps.

The tax equity tranche will be made available on the commercial operation date (COD) and will be arranged by US Bancorp Impact Finance.

The Atrisco complex also includes a 364MW solar plant, the financing for which was arranged last December [2023].

The solar plant has a CapEx of $370 million, which was financed using:

• term loan - $107 million
• upfront tax equity contribution - $198 million
• equity from sponsor - $65 million

The term loan for the solar park was arranged by the same banking club led by HSBC. It is also a five-year mini-perm but with a 23-year underlying amortisation profile.

The pricing of the term loan is uniform across both elements of the Atrisco Complex.

The tax equity for this element was arranged by Bank of America.

The Atrisco Complex occupies approximately 1,700 acres on a desert plateau outside Albuquerque.

The development benefits from a 20-year busbar power purchase agreement (PPA) with Public Service Company of New Mexico.

Under a busbar contract, the offtaker – in this case, the Public Service Company of New Mexico – will be responsible for installing the transmission infrastructure, which will connect the generation asset to the end user.

RES has taken the EPC mandate on this development. The battery storage element will be fitted with Tesla megapacks.

The combined facility is currently in the commissioning phase, with full COD expected before the end of this year [2024].

The complex will generate and store enough energy to satisfy the annual consumption of 110,000 average households.