Intersect Power closes financing for 1GWh of battery projects due in 2024

US clean tech company Intersect Power has closed $837 million in financing for the construction and operation of three standalone battery energy storage systems (BESS) in Texas, representing 1GWh in storage that will move from concept to commissioned in under 12 months.

The three BESS — Lumina I, Lumina II and Radian — are already under construction and are expected to be operational in 2024.

Each project comprises 86 Megapacks, Tesla’s battery energy storage system, and Lumina II and Radian will be operated by Autobidder, Tesla’s real-time trading platform.

The three sites will each provide a capacity of 320MWh of battery storage with a two-hour duration. These batteries provide additional flexibility to Intersect’s Texas operating fleet, offering 1.2GWp of solar power with 1GWh of battery storage.

Commenting in a release was Sheldon Kimber, CEO and founder of Intersect Power: “Batteries will be a vital part of the energy transition and are the perfect complement to the billions of dollars of solar generation that we are building in California and Texas.

“These assets should allow us to provide more consistent financial performance from a diversified fleet of renewable generation and storage, benefiting from increasing market volatility and periods of high prices while protecting us from periods of low market prices. This stability will be critical as we expect to triple the size of our portfolio over the next three years.”

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For the BESS financing, Intersect Power closed two separate transactions representing an aggregate of $837 million. The transactions cover portfolio-level construction debt, tax equity and term debt financing with industry-leading partners.

Morgan Stanley was selected to provide tax equity and funds and accounts managed by HPS Investment Partners will be making construction debt and term debt investments.

Deutsche Bank is partnering in the construction debt facility and providing the operational letters of credit to the projects. The projects also qualify for Investment Tax Credits under the Inflation Reduction Act.

Said Jorge Iragorri, managing director and head of renewable energy investments at Morgan Stanley:

“Morgan Stanley is proud to partner again with Intersect Power, a clean energy company bringing innovative and scalable low-carbon solutions to its customers in global energy markets.

“These standalone batteries are much-needed infrastructure that will increase grid reliability and improve energy security as the US transitions to a low-carbon economy.”

Added Jeremy Eisman, managing director and head of infrastructure & energy financing at Deutsche Bank: “Deutsche Bank is pleased to once again support Intersect Power, this time for the swift construction and deployment of three utility-scale standalone battery storage systems in Texas.

“This financing will help facilitate Intersect’s contributions to the reliability of the US power grid and validates Deutsche Bank’s continued commitment to support the premier developers in the sector.”

Founded in 2016, Intersect Power has a base portfolio of 2.2GW of operating solar PV and 2.4GWh of storage in operation or construction across Texas and California.

The company’s business plan includes growth in grid-tied renewables, as well as large-scale clean energy assets, including battery storage, data centres and green hydrogen.