Enlight Announces Financial Close on Atrisco Energy Storage Project
The financing package for the energy storage portion of the project includes over $400 million of loans and tax equity arranged by HSBC and U.S. Bank
Atrisco is one of Enlight's flagship projects in the U.S., combining 364 MW of solar generation capacity with 1.2 GWh of battery storage capacity, and is expected to reach full COD later this year
The financial close for the Energy Storage Project completes the financing and tax equity arrangements of the entire Atrisco complex
TEL AVIV, Israel, July 29, 2024 (GLOBE NEWSWIRE) -- Enlight Renewable Energy Ltd. (("Enlight", "the Company", NASDAQ:ENLT, TASE: ENLT.TA)), a leading global renewable energy platform, today announced that the Company has closed the financing (the "financial close") for the Energy Storage portion of its flagship Atrisco Solar and Energy Storage project, located outside Albuquerque, New Mexico, USA (the "Financing"). The Company reached financial close on the Atrisco Solar project in December 2023, and the financing of the Energy Storage portion completes financing and tax equity arrangements for the entire Atrisco project.
The Atrisco complex combines364 MW of solar generation capacity with 1.2 GWh of battery storage, cost $827 million to build, and will be financed by $290 million of term debt and $420 million of tax equity (a combined 86% of total cost), with Enlight's long-term equity investmentamounting to $117 million (14% of total cost). The project, which is the largest project undertaken by the Company to date, is now in the commissioning phase leading up to partial COD, and is expected to reach full COD later this year.
As part of the financial close, Enlight through its subsidiary, Clenera Holdings LLC, has entered into a loan agreement with a consortium of eight leading global banks led by HSBC, totaling $401 million to finance the construction of Atrisco Energy Storage. The loan will convert into a $185 million term loan from the same group of lenders and tax equity financing of $222 million provided by U.S. Bancorp Impact Finance upon the project's COD. The term loan is structured with a 20-year underlying amortization profile with a 5-year mini perm, and is subject to an all-in interest rate (fixed base + margin) of 5.6% to 5.9%. The competitive financing terms achieved reflect the high quality of the Atrisco project.
The Atrisco Solar project was financed by a consortium of leading global banks led by HSBC, and tax equity was provided by Bank of America. The Atrisco project's tax equity financing qualified for the Energy Community IRA adder due to a brownfield addition to the project.
In connection with the financing of the Atrisco Energy Storage project, Enlight expects to recycle $234 million of equity back to its balance sheet, which will be used to fund future growth. Additional financial information regarding the Atrisco co-located solar and energy storage complex appears in the following table:
| (as expected at COD) | Total project cost | Term debt | Upfront tax equity | Sponsor equity |
| Atrisco Storage | $458 million | $185 million | $ 222 million | $52 million |
| Atrisco Solar | $369 million | $105 million | $198 million1 | $65 million |
| Total | $827 million | $290 million | $420 million | $117 million |
| Total project cost net | Expected revenues | Expected EBITDA2 | |
| Atrisco Storage | $236 million | $32-34 million | $27-29 million |
| Atrisco Solar | $171 million | $19-21 million | $14-16 million |
| Total | $407 million | $51-55 million | $41-45 million |
1 The tax equity partner, Bank of America, monetizes 90% of the PTCs, while the company is entitled to monetize the remaining 10%. The upfront tax equity payment to be received by the Company upon project COD reflects approximately 75% of Bank of America's share of the PTCs. The remaining 25% will be paid annually to the Company by Bank of America, based on actual production, over the initial 10 years of the project's operation.
2 EBITDA is a non-IFRS financial measure. This figure represents consolidated EBITDA for the projects and excludes all ITC and PTC proceeds. The tax equity partner's share in the distributions is 19% for the energy storage project and 17.5% for the solar project, applicable for the first five and ten years of operation, respectively.
Atrisco is located on a desert plateau with extremely high solar irradiation and is sized at approximately 1,700 acres. The project construction was led by RES, one of the leading EPC contractors in the U.S., and the battery energy storage system provided by Tesla. Atrisco is expected to provide clean electricity equivalent to the average annual consumption of approximately 110,000 New Mexico households through a 20-year busbar PPA agreement with Public Service Company of New Mexico covering both electricity production and energy storage.
After the completion of our APEX project in Montana, earlier this year, Atrisco is the second of several major solar and energy storage projects the Company will begin building in the U.S. in the coming months, including Country Acres (392 MW and 688 MWh); Roadrunner (290 MW and 940 MWh(; and Quail Ranch (128 MW and 400 MWh), a brownfield extension of Atrisco. These, along with additional projects planned to be built in the years to come, are driving Enlight's massive expansion into the U.S. renewable energy market. This is best illustrated by the share of U.S. generation capacity within Enlight's total installed base, which is expected to rise from 5% at the end of 2023 to 59% by the end of 2026.
Gilad Yavetz, CEO of Enlight, commented: "The Atrisco complex is Enlight's flagship project in the United States, and today's financial close is another important step in the completion of this project. We look forward to the phased COD of Atrisco, expected to begin during this quarter, in which years of effort will finally come to fruition. Enlight is embarking on an ambitious and rapid growth plan in the U.S., which is set to become a major market for us in the coming years, complementing the large and growing capacity footprint we have built up in MENA and Europe. Atrisco represents another step of this major expansion."
"HSBC is proud to support Enlight's continued development of the Atrisco project through the addition of the Energy Storage System to the existing Solar Project. The cross-border, multinational collaboration is a testament to our mutual ambition to transition to a net-zero future," said Paul Snow, Head of Renewables, Americas, HSBC Infrastructure Finance
"We are pleased to collaborate with Clenera as part of our continued commitment to facilitate the transition to a greener economy," said U.S. Bancorp Impact Finance Senior Vice President and Business Development Officer Colin Witherspoon. "With this deal, we expanded our environmental finance platform by seamlessly providing project finance and tax equity."
About Enlight Renewable Energy
Founded in 2008, Enlight develops, finances, constructs, owns, and operates utility-scale renewable energy projects. Enlight operates across the three largest renewable segments today: solar, wind and energy storage. A global platform, Enlight operates in the United States, Israel and 10 European countries. Enlight has been traded on the Tel Aviv Stock Exchange since 2010 (TASE: ENLT) and completed its US IPO (NASDAQ:ENLT) in 2023. Learn more at enlightenergy.co.il.
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This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements as contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained in this press release other than statements of historical fact, including, without limitation, statements regarding the Company's expectations relating to the Project, the PPA and the related interconnection agreement and lease option, and the completion timeline for the Project, are forward-looking statements. 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