Debt finance

Debt financing deal will ‘maximize returns’ from Genex’s Tesla battery project in Queensland, Australia

40 Tesla Megapack units will be used at the Bouldercombe site. Picture: Tesla.

Genex Power has received credit approvals on a A$35 million (US$25.26 million) debt financing facility for its 50 MW Bouldercombe Battery Energy Storage (BESS) Project/ 100 MWh in Queensland, Australia.

The renewable energy and energy storage developer said in an announcement to the Australian Securities Exchange (ASX) that it has entered into the financing agreement with Infradebt, a company specializing in fund management and financing. funding for projects focused on the energy transition space.

The debt financing will allow Genex to “maintain upside exposure to the attractive economics of energy storage and maximize project economic returns,” said company CEO James Harding.

Genex said it will now negotiate final terms with Infradebt and bring the project to financial close.

Bouldercombe Battery Project (BBP) will be one of Queensland’s first large-scale stand-alone BESS facilities. Scheduled to go live in the second half of 2023, the 12-year term of the Infradebt loan comes into effect once commercial operations have begun.

Genex selected technology supplier Tesla to provide the fully integrated battery storage solution to BBP, in the form of the US-based company’s 40 Megapack BESS units, which were also used in the larger battery project. from Australia to date, the 300 MW/450 MWh Victorian Big Battery. , which power producer Neoen recently uploaded in Victoria state.

Tesla’s Autobidder machine-learning algorithm-based bidding system will also manage the BESS’s shipping and trading activities. Genex and Tesla signed an eight-year offtake agreement for this, which after the agreement expires is expected to be renegotiated as a license agreement.

In addition to the A$35 million debt financing, Infradebt has signed a cooperation agreement with Genex to continue working on financing other merchant BESS projects in Australia. The financial leverage this deal will provide means that Genex will retain the economics advantage of the battery storage market, the company said.

Genex is also currently constructing Australia’s first new pumped hydroelectric energy storage (PHES) project in nearly 40 years, the 250 MW/2,000 MWh Kidston Stage 2 pumped hydro project, also in Queensland.

Friday, Energy-Storage.news reported that Australian energy retailer Origin Energy plans to exit coal sooner than expected, given the competition fossil fuels face with renewables and energy storage.

Origin said it wants to bring forward the decommissioning date of its 2,880 MW Eraring coal-fired power plant from 2032 to 2025 and build a 700 MW BESS at the site. The evolution of the National Electricity Market (NEM) makes it more difficult to keep track of baseload coal, with fast-response batteries in particular able to capitalize on changing market structures.

According to quarterly data from the Australian Energy Market Operator (AEMO), market revenue that battery storage systems earn for frequency control ancillary services (FCAS) is increasing, batteries are suppressing negative price events and l The introduction of Five-Minute Settlement (5MS) to replace 30-Minute Settlement in the NEM is among the factors behind the rise to which Genex refers.