Statera successfully structured and executed a greenfield portfolio financing of £395m to fund the construction of one of Europe’s largest co-located battery energy storage system (BESS) and flexible generation projects. Spread over two phases, the financing was supported by a number of government-backed capacity market (CM) contracts, which allow for the provision of much needed fast response generation capabilities in an increasingly volatile power market.
The assets operated and developed by Statera play a critical role in balancing the future low-carbon grid. As the UK moves towards its 2050 net zero target, flexible generation solutions are essential for maintaining a safe and stable electricity supply for households and businesses. The financing across both stages of this project, the BESS and a reciprocating gas peaker (RGP) plant, will enable the business to grow while it continues developing technologies that will underpin the UK’s sustainable energy transition.
The combined financing delivered a market-first structure, integrating two distinct availability-based revenue models while leveraging the synergies of two complementary technologies to enhance the overall credit profile. This creates a highly bankable structure while optimising value for Statera. The structuring of the transaction mitigated a number of risks for lenders – the portfolio can operate across a range of market conditions, the assets within the portfolio are severable, allowing one to support the other in a distress event, while construction risk is reduced by the staggered nature of the development. This demonstrates the advantages of financing the assets on a combined basis and sets a market precedent for similar financings in the future.
Such deals, with sustainability at their core, and taking advantage of contracts offering Government-backed security are very important for the future of UK infrastructure
