The complex and customized nature of microgrid development often requires a unique approach to financing, too.
Scale Microgrid Solutions recently secured a $225 million debt facility that it plans to use to expand its portfolio and limit risks that come with microgrids.
The non-recourse construction-to-term project finance debt facility is the first of its kind for a microgrid and energy transition portfolio transaction, Scale said. The financing is linked only to assets and contracts and does not imply a guarantee from Scale or its equity investor Warburg Pincus, limiting the risk to both.
KeyBanc Capital Markets acted as joint lead arranger and structuring administrative agent on the loan. City National Bank also contributed as joint lead arranger, and Energetic Insurance provided a credit insurance policy enabling access to the bank lending market.
The debt will be used to fund the construction and operations of a portfolio of microgrids, combined heat and power systems, community solar, rooftop solar, battery energy storage systems, and microgrid electric vehicle infrastructure projects in markets including California, Oregon, the District of Columbia, Pennsylvania, Delaware, Colorado, North Carolina, New Jersey, and New York.
Earlier this month, Scale announced the acquisition of 23 operating distributed solar projects “from a leading solar asset owner,” without providing additional details about the projects or original owner. The transaction was executed through LevelTen Energy’s marketplace.
The acquisition also added FedEx and Colorado State-Pueblo University to Scale’s list of corporate clients.
