Equity financing partnership with Summit Transition Partners
Funds like GRID helped kickstart the UK grid-scale energy storage market by raising public capital and putting that money into BESS projects, alongside debt project finance. However, since the fall in share prices, raising that public capital is much harder.
The company has now opted for a different approach, bringing on Summit Transition Partners (STP) as an equity investment partner. STP is controlled by Japanese conglomerate and trading house Sumitomo Corporation with participation from TPK Holding. It will cover the bulk of the equity investment needed for five projects totalling 697MW, starting with three totalling 397MW, with debt covering the rest.
“Bringing in outside capital reduces our required equity significantly,” Guest explained. “It reduces our EBITDA, but means a much smaller level of capital required so de-risks our business.”
“It crystallises some of the value we’ve created on our projects, reduces day one capital requirement from GRID and boosts our equity returns,” added James Bustin, assistant fund manager for GRID.
