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The upsizing doubles the credit limit of the $375mn facility secured in May’22.
The upsizing was led by CIT, a division of First Citizens Bank, with support from existing lenders including Santander, Deutsche Bank and HSBC, as well as from new investors such as Sumitomo Mitsui Banking Corp, KeyBank and Natixis. The funds will be deployed for the development of a 20 GW+ pipeline consisting of utility-scale and distributed generation projects across solar, solar plus storage, and stand-alone storage technologies.
Founded in 2008, Origis Energy develops, owns and operates solar and energy storage solutions, with a current portfolio of over 3.3 GW of solar projects and 1.25 GWh of storage capacity, primarily in the US. The company’s projects are backed by power purchase agreements (PPAs) with several major public utilities, such as PG&E, Pacificorp and Alabama Power as well as corporate customers including Meta and Google. The company has also partnered with Mitsubishi Power to harness BESS technologies and develop systems co-located with existing solar projects in the US.
The latest financing follows several orders recently made by the company to secure solar modules for the construction of projects. This includes deals for over 2 GW of thin film modules from US-based manufacturer First Solar and 1.1 GW of modules from Vietnam-based Boviet Solar Technology Co.
Enerdatics understands that in 2022, project developers altered their financing strategies and targeted equity capital over debt and bond issuances, driven by increases in the cost of debt capital due to rising interest rates. Additionally, elevated equipment prices due to supply chain bottlenecks inflated the cost of installing renewable energy projects, impacting financiers’ appetite to bankroll projects. Enerdatics observes that 2022 marked the first year that equity issuances for solar and wind projects in the US equaled debt raises, with capital sourced from each market standing at ~$19bn. However, Enerdatics observes a surge in debt financing during the first two months of 2023, with more than $3bn of project-level loans secured by leading developers and power producers. The surge is believed to be driven by a period of stable interest rates starting from early Dec’22 through to 2nd Feb’23, post which the federal bank raised interest rates by 0.25%, the eighth rate hike since it began raising rates last March. Some of the major transactions so far in 2023 include Sunrun securing $853mn of loans from lenders including KeyBank, Silicon Valley Bank, and RBC as well as Hecate Energy finalizing $550mn of credit facilities from institutions such as Generate Capital, Deutsche Bank, and Nomura. Enerdatics also notes that the majority of the capital was secured for solar and solar-plus-storage projects, a trend believed to be attributed to the Biden Administration’s 24-month moratorium on import tariffs for panels from Southeast Asia. The moratorium has resulted in a rush by developers to secure capital to resume development and construction activities on delayed projects, as well as accelerate the buildout of previously planned initiatives.
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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