Smart energy finance weekly
In this first iteration of our weekly financial roundup, companies such as Renault, Equinor, CPower and Iberdrola have been making moves to stake their claims within the energy transition.
Areas of interest include electric and hybrid powertrains, energy storage, green hydrogen and demand response.
Renault and Vitesco look into electric and hybrid powertrains
Renault Group has announced a partnership with Vitesco Technologies, an international manufacturer of modern drive technologies and electrification solutions for the joint development and production of power electronics in a ‘One Box’ for electric and hybrid powertrains.
Renault and Vitesco will define the products and assembly processes of this ‘One Box’ by integrating the latest technologies to ensure the best level of competitiveness in terms of performance and cost.
The goal is a key electronic unit that combines all components in one housing: the DC-DC converter, the on-board charger OBC and the inverter.
The One Box concept is also hoped to enable gain in compactness (-45% in volume) and mass for the development of Renault’s future vehicles. The configurations and assembly of the various basic components will be adapted to the types of electric and hybrid powertrains. The development platform teams will be mostly based in Toulouse.
The development of this ‘One Box’ is planned to equip electric and hybrid vehicles in Renault’s high-voltage core range from 2026 onwards, with the objective for the group to eventually assemble this product in its industrial sites in France for 100% electric vehicles.
With this new partnership, Renault Group is extending its control over the electrical value chain by integrating this unique power electronics “all-in-one” system, co-developed in-house.
Renault Group will at the same time provide Vitesco Technologies with a multi-year contract for the power electronics of Renault’s hybrid vehicles. In addition, Vitesco Technologies will supply to the Renault Group a ‘High Voltage Box’, which combines the DC/DC converter and charger, for battery electric vehicles as of 2025.
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Equinor acquires US energy storage developer
The international energy company has acquired East Point Energy, which is headquartered in Charlottesville, Virginia and has a 4.1GW current pipeline of early to mid-stage battery storage projects focused on the US East Coast.
Battery storage is hoped by the major renewables player to play an important role in the energy transition as the world increases its share of intermittent renewable power.
Equinor has stated the aim of leveraging this opportunity to create a profitable business by deploying battery storage assets in selected power markets.
East Point Energy will become a subsidiary of Equinor with its team continuing to develop the business, as well as adding capabilities to own and operate energy storage projects in the near future.
The transaction agreements were signed on 9 July and the transaction is planned to be completed in Q3 2022.
CPower to acquire Centrica’s US demand response business
The move is hoped to position CPower as a leader in enabling grid flexibility and reliability with an estimated 6.3GW of DER capacity.
The energy solutions provider announced a definitive agreement to acquire the business, which provides commercial and industrial load management with customers in PJM, ISO-NE, NYISO, and ERCOT.
The acquisition will bolster CPower with nearly 6.3GW capacity at more than 17,000 sites available to be dispatched to the grid when it’s needed most. In return, CPower has stated they will help participating DER owners keep energy costs low, enhance resiliency and avoid carbon emissions by being available to use less electricity during peak periods.
The transaction is expected to close in the third quarter of 2022, subject to regulatory approval and customary closing conditions.
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Iberdrola signs on €2.5bn sustainable credit facility
The group has signed with 24 banks of different nationalities for a new credit line linked to sustainability indicators for €2.5 billion ($2.5 billion).
The facility has a term of five years, extendable for a further two years, and is multi-currency.
This new credit line is subject to two sustainability indicators – the reduction in the consumption of water used in power generation and the rating assigned to Iberdrola by the independent agency CDP Water.
Based on compliance, the margin of the operation may be adjusted downwards (if met) or upwards (if not met) on an annual basis.
Iberdrola announced the facility in reference to the importance of water use in the management of its activities as well as part of their aim to contribute to SDG 6: Clean Water and Sanitation.
Iberdrola also stated their aims to issue most of their debt instruments under a green or sustainable format. In line with this, the new operation is focusing water impact management, promoting the reduction of water consumption in electricity production and seeking recognition from investors in the management thereof.
In the operation, BBVA acted as agent bank and coordinating bank in sustainability matters.
The transaction signed is, according to the group, in line with the LMA (Loan Market Association) Sustainability-Linked Loan Principles and has an SPO (Second Party Opinion) from Moody’s ESG Solutions.
$198m to Electric Hydrogen for electrolyser scale-up
Electric Hydrogen (EH2) has secured $198 million to support efforts in making cost competitive fossil-free hydrogen.
The round consisted of Series B equity and venture debt from top investors. Fifth Wall Climate Tech led the round, with participation by S2G Ventures, and lenders Silicon Valley Bank and Trinity Capital.
Strategic investors included Amazon’s Climate Pledge Fund, Cosan, Equinor Ventures, Honeywell, Mitsubishi Heavy Industries, and Rio Tinto. Previous investors Breakthrough Energy Ventures, Capricorn Partners, Energy Impact Partners and Prelude Ventures also participated.
The funding will support the scale-up of EH2’s high throughput electrolyser technology and the manufacturing and deployment of demonstration projects to produce fossil-free hydrogen (also known as green hydrogen) at large scale for industrial and infrastructure applications.
Led by cofounders Raffi Garabedian and Dave Eaglesham, former executives at First Solar, Dorian West, former engineering lead at Tesla, and Derek Warnick, former Company Builder at Breakthrough Energy Ventures, Electric Hydrogen’s team brings together expertise in multiple sectors, from engineering and finance to manufacturing.
