Leeward Renewable Energy (LRE) has closed $260mn in construction financing and $143mn in tax equity commitments for the Chaparral Springs project, which comprises 174 MW of solar capacity and an 88 MW/352 GWh battery energy storage system (BESS). The project is located in California’s Kern county and is currently under construction, with commercial operation scheduled for Sep’23. Wells Fargo served as the administrative, green structuring agent, and coordinating lead arranger on the construction financing, and MUFG and Silicon Valley Bank served as joint lead arrangers. Additionally, JP Morgan provided ~$29mn of tax equity investment, with commitments for an additional ~$114mn once the project is brought online.
Chaparral Springs is backed by two 15-year power purchase agreements (PPAs) with community choice aggregators (CCAs) Peninsula Clean Energy and Valley Clean Energy. The CCAs have also contracted capacity from the 88 MW BESS. The project represents LRE’s third integrated solar-plus-storage investment in the county.
As per Enerdatics’ research, the recent financing is consistent with LRE’s strategy of raising capital via the debt and equity markets for its projects and expands the company’s relationship with Wells Fargo, MUFG, and JP Morgan. In Jun’22, LRE closed $58.5mn in construction financing from Wells Fargo, MUFG, and Silicon Valley Bank, and $62.5mm in tax equity investments from JP Morgan for the 120 MW Rabbitbrush solar-plus-storage project. Enerdatics observes several similarities between the two transactions, such as both projects being under construction at the time of financial close, with commercial operation anticipated within the following 8 months. Further, both facilities are located in Kern county and are backed by 15-year PPAs with two CCAs - Central Coast Community Energy (CCCE) and Silicon Valley Clean Energy (SVCE).
Enerdatics estimates that LRE, a portfolio company of private equity firm OMERS Infrastructure, has raised more than $1.6bn since 2021 for the construction of ~1.4 GW of solar and wind projects in the US through non-recourse debt and tax equity.
The above analysis is proprietary to Enerdatics’ energy analytics team, based on the current understanding of the available data. The information is subject to change and should not be taken to constitute professional advice or a recommendation.
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