US renewables investor SB Energy has raised a massive US$2.4 billion in funding to support the construction of 1.3GW of new solar capacity in the US.
The funding consists of US$800 million in tax equity, raised through four US lenders: Bank of America, J.P. Morgan, Morgan Stanley Renewables and Truist Bank. The remainder of the funds consists of US$1.2 billion in construction debt and US$450 million in term debt, raised through an international group of backers: US bank Fifth Third Bank, the Canadian Imperial Bank of Commerce, Dutch bank ING, French investor Société Générale and Asian firms MUFG, the Sumitomo Mitsui Banking Corporation and the Americas division of Mizuho.
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While SB Energy did not announce a timeline for construction or commissioning on the projects, named Eiffel I and Orion I-III, it noted that it had signed a power purchase agreement (PPA) with Google. The US technology giant will acquire 75% of the power produced by the entire portfolio to power one of its data centres in the US state of Texas.
“We are pleased to work with SB Energy again and support their important mission to drive the growth of American jobs in communities that have long contributed to our country’s energy growth, and now in a sustainable way,” said Todd Karas, head of renewable energy finance at Bank of America.
The portfolio is also notable as three of its projects are the first utility-scale facilities in the US to reach financial close with a domestic content adder, a provision within the landmark Inflation Reduction Act (IRA) legislation that grants a 10% tax credit to renewable project developers using a majority of materials and components produced in the US.
SB Energy noted that its projects will use 1.1 million solar modules manufactured in the state of Ohio by First Solar, Nextracker will provide trackers for the projects and steel used across the portfolio will be produced in Georgia and Texas.
While SB Energy did not specify which of First Solar and Nextracker’s products would be used at the projects, the use of components produced in the US by two US-headquartered companies will be an important demonstration of the potential of the IRA, which has the potential to dramatically alter the US’ energy mix and energy supply chain.
“The IRA’s content and energy community incentives were designed to expand America’s manufacturing base and create good-paying jobs in communities that need them,” said Rich Hossfeld, co-CEO of SB Energy, highlighting the importance of the IRA in delivering the projects.