On.Energy – a proven end-to-end integrator of battery energy storage and Independent Power Producer (IPP) – recently announced it has closed both construction facility totaling over $40 million and permanent debt facilities for an 80 megawatt-hour (MWh) portfolio in Texas (the Palo Verde Projects) with financing provided by Live Oak Bank. The projects, which are set to come online in Q3 of 2024, will support the balancing of the ERCOT grid by providing both ancillary services as well as arbitrage.
This project also integrates an investment tax credit (ITC) transfer among the first of its kind for merchant battery storage projects. And the portfolio includes both greenfield development sites as well as projects acquired through M&A in mid-2023. The company also continues to advance a pipeline of over 1GWh of utility-scale energy storage systems across ERCOT, CAISO, and beyond, with a follow-on portfolio of projects of 160MWh expected to begin operation by Q3 2025.
Wilson Sonsini served as On.Energy’s counsel for the transaction.
KEY QUOTES:
“On.Energy has closed a capital solution for our assets at a time when many are still trying to sort out the Inflation Reduction Act and its implications. The structure underpinning the Palo Verde Portfolio establishes On.Energy as a serious player in the ESS space with an emerging financial capability to match our renowned technical credentials.”
- Energy CFO David Fernandes
“Live Oak is excited to partner with On.Energy and to support energy projects that bring good jobs, carbon reduction, and electricity savings to Texas.”
- Kevin Rooney, loan officer for Live Oak’s energy and infrastructure emerging markets team
“We are honored and excited to be working with Live Oak Bank. Their continued support will be invaluable as the company moves to larger capital asset investments across the U.S. in 2024 and 2025.”
- Energy President of North America Salvatore Minopoli
