U.S. development bank NADBank is providing a $65.7 million loan for a solar and energy storage project near the town of Brackettville in Kinney County, Texas, on the border with Mexico’s Coahuila.
The project will build a 160MW solar PV array, complemented by a 40MW two-hour BESS, and will also involve the construction of a new 3.67-mile transmission line to connect to the nearby 138kV Pinto Creek substation. It is managed by Cypress Creek Renewables, a solar and energy storage developer with operations across the country that was acquired by private equity firm EQT last November.
The financing announcement did not reveal a start date for construction or operations, but an earlier loan proposal said construction could begin by July this year, with a start date for operations in the third quarter of 2023.
Located 17 miles northeast of the U.S.-Mexico border, the primary purpose of the project is to add renewable energy and energy storage capacity to the Texas grid operated by ERCOT. The ERCOT grid is unique in that it is fully decentralized, with no centralized capacity auctions like in the UK and most other grids, which means that BESS projects make money through energy trading and ancillary services.
BESS will help ERCOT reduce the use of fossil fuel power plants, integrate more renewable energy into the grid and improve grid reliability.
According to the project proposal, BESS is expected to complete the equivalent of 0.4 charge-discharge cycles (32MWh) per day, with a round-trip efficiency of 87%. For the first five years, it will be limited to charging from photovoltaics, after which it will also be able to purchase electricity from the grid.
The proposal said the solar array would include 380,000-440,000 bifacial monocrystalline PV modules from "top global suppliers". BESS will use Tesla Megapacks.
Cypress will be the asset manager, operator and maintenance provider for the BESS units and will sign a 20-year capacity maintenance agreement with Tesla, which will replace degraded battery modules. It wants to use Tesla's battery recycling program for end-of-life battery modules. Cypress currently has 1.6GW of solar and energy storage assets in the United States.
Project Zier is the second BESS funding announcement by NADBank in a few weeks. At the end of May, it participated in the first fully-debt financing of a fully commercial BESS project in California.
