Climate Insider Brief:
- Clearway Energy Group secured a $700 million construction financing deal through a consortium of banks for solar and storage projects in California.
- Construction has started on the 200MW Luna Valley Solar Project in Fresno and the 113.5MW Daggett battery energy storage system in San Bernardino.
- These projects, part of a larger solar-plus-storage initiative, will enhance California’s renewable energy capacity, with a combined PV capacity of 482MW and a storage output of 394MW.
Clearway Energy Group, a leading renewables developer, has successfully closed a US$700 million construction financing deal for a portfolio of solar and storage projects in California. The financing was secured through a consortium of banks, including Nord/LB, Société Générale, KeyBanc Capital Markets, DNB, and ANZ.
Construction has commenced on two significant projects: a solar photovoltaic (PV) plant and a standalone battery energy storage system (BESS), located in the Californian counties of Fresno and San Bernardino. The solar PV plant, known as the Luna Valley Solar Project, is situated in Fresno and boasts a capacity of 200MW. Meanwhile, the Daggett storage project in San Bernardino offers an output of 113.5MW and represents the final phase of a larger solar-plus-storage initiative with a combined PV capacity of 482MW and a storage output of 394MW.
Both projects are slated for commercial operations in 2025, with construction overseen by renewables contractor Blattner Energy. Clearway Energy Group has also secured a 15-year virtually paired hybrid power purchase agreement (PPA) with utility San Diego Gas & Electric for both projects. Additionally, the remaining capacity of the Luna Valley PV plant is contracted under a 20-year PPA with Southern California Edison and Power & Water Resources Pooling Authority.
“Luna Valley and Daggett 1 represent two major steps forward in California’s path to a reliable, affordable, and clean electric grid,” stated Brooks Friedeman, VP of Capital Markets at Clearway Energy Group.
Over the past five years, Clearway has made substantial contributions to California’s renewable energy landscape, putting over 2.3GW of solar and storage projects into construction and operation. The latest projects further solidify the company’s commitment to advancing sustainable energy solutions and supporting the state’s ambitious clean energy goals.
Implications for Climate Tech
The closing of a $700 million construction financing deal by Clearway Energy Group for solar and storage projects in California marks a significant milestone for climate tech, with several key implications:
- Increased Renewable Energy Capacity:
- The financing will enable the construction of the Luna Valley Solar Project (200MW) and the Daggett standalone battery energy storage system (113.5MW), adding substantial capacity to California’s renewable energy portfolio.
- The Daggett project, part of a larger solar-plus-storage initiative, will ultimately deliver 482MW of PV capacity and 394MW of storage output, showcasing the scalability of such projects.
- Financial and Institutional Support:
- The involvement of a bank consortium including Nord/LB, Société Générale, KeyBanc Capital Markets, DNB, and ANZ highlights strong institutional support for renewable energy projects. This could encourage further investments in climate tech as financial institutions recognize the viability and profitability of such ventures.
- Enhanced Grid Reliability and Stability:
- By integrating significant solar PV and battery storage capacities, these projects will contribute to a more reliable and stable electric grid in California. This is crucial for balancing supply and demand, especially as the state increases its reliance on intermittent renewable energy sources.
- Long-term Power Purchase Agreements (PPAs):
- The secured PPAs with San Diego Gas & Electric, Southern California Edison, and Power & Water Resources Pooling Authority provide financial stability and predictability for the projects. These agreements also demonstrate the growing demand for renewable energy from utilities, paving the way for more projects and innovations in the sector.
- Job Creation and Economic Impact:
- The construction and operation of these projects, managed by Blattner Energy, will create jobs and stimulate economic growth in the Californian counties of Fresno and San Bernardino. This local economic boost underscores the broader benefits of investing in renewable energy infrastructure.
- Progress Toward California’s Clean Energy Goals:
- These projects represent significant steps toward achieving California’s ambitious clean energy targets. By increasing renewable energy generation and storage capacity, Clearway Energy Group is contributing to the state’s path to a reliable, affordable, and clean electric grid, as highlighted by VP Brooks Friedeman.
- Innovation in Solar-Plus-Storage Solutions:
- The successful development of large-scale solar-plus-storage projects demonstrates the technological advancements and cost reductions in these systems. This can inspire further innovations and improvements in climate tech, making renewable energy more efficient and accessible.
- Potential for Replication and Scaling:
- The successful financing, construction, and operation of these projects can serve as a model for similar initiatives globally. This could lead to wider adoption of solar and storage solutions, accelerating the transition to a low-carbon economy.
SOURCE: Energy Storage News
Featured Image: Credit: Clearway Energy Group
