Recurrent Energy Secures $513 Million for 1,200 MWh Energy Storage Project

Recurrent Energy, a solar and energy storage project developer and a wholly owned subsidiary of Canadian Solar secured $513 million in project financing for its 1,200 MWh Papago Storage project in Maricopa County, Arizona.

The financing includes a $249 million construction and term loan, a $163 million tax equity bridge loan, and a $101 million letter of credit facility. Bank of America, CoBank, DNB, Rabobank, Siemens Financial Services, and Zions acted as joint lead arrangers for the transaction. MUFG and Nord/LB acted as coordinating lead arrangers for the project financing.

Construction of the Papago Storage project is scheduled to begin in the third quarter of 2024, with commercial operations expected to start in the second quarter of 2024.

Sondra Martinez, Managing Director of Nord/LB, said, “Nord/LB is pleased to have acted as a coordinating lead arranger (CLA) for the successful closing of Recurrent Energy’s latest landmark project. Papago Storage marks Nord/LB’s 11th standalone storage project in the U.S., and we are excited to take the lead in financing strategic battery storage assets, supporting the energy transition and mission to achieve a more reliable, carbon-free grid. We look forward to continuing to support Recurrent Energy’s ambitious growth in the industry.”

According to Mercom’s Q1 2024 Funding and M&A report for Storage and Smart Grid, energy storage project funding increased 65% year-over-year, coming in at $3.3 billion in nine deals in Q1 2024 compared to $2 billion raised in nine project funding announcements in Q1 2023.

Recently, Apex Clean Energy, a renewable energy project developer, secured over $150 million in project financing for two energy storage projects in Texas. First Citizens Bank Energy Finance business and Bank United served as co-lead arranger of the financing.