Recurrent Energy Secures $513 Million for Energy Storage Project in Arizona

Recurrent Energy has secured USD 513 million in project financing for its landmark Battery energy storage system in Maricopa County, Arizona, USA. The 1,200 MWh Papago Storage construction is slated to commence in the third quarter of 2024, with commercial operations expected to begin in the second quarter of 2025. The project holds a 20-year tolling agreement with Arizona Public Service Company and is expected to create 200 jobs during construction.

Mitsubishi UFJ Financial Group (MUFG) and Norddeutsche Landesbank (Nord/LB) acted as coordinating lead arrangers for the Papago Storage project. MUFG and Nord/LB are financial institutions that significantly finance renewable power projects worldwide. The financing includes a USD 249 million construction and term loan, a USD 163 million tax equity bridge loan, and a USD 101 million letter of credit facility. Joint lead arrangers for the transaction included Bank of America, CoBank, DNB, Rabobank, Siemens Financial Services, and Zions.

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Following construction, Recurrent Energy will own and operate Papago Storage. The project will dispatch enough power for approximately 244,000 homes for four hours daily, enabling renewable energy to power Arizona’s growing economy further. Ismael Guerrero, CEO of Recurrent Energy, said, “When we began developing Papago Storage in 2016, the Arizona storage market was in its infancy. Today, Arizona is one of the fastest-growing markets for energy storage in the United States, bolstered by the state’s expanding economy and cost-effective renewable energy resources.” 

Recurrent Energy has delivered more than 10 GW of solar power projects and 3.3 GWh of energy storage projects, boasting a global project development pipeline of 26 GW and 56 GWh for solar and energy storage, respectively. In North America, Recurrent Energy is actively developing a pipeline of 6.3 GW solar projects and 18.9 GWh battery energy storage projects.

Upcoming Battery Storage Projects in Arizona

Arizona is witnessing significant growth in battery storage projects, bolstering its renewable energy infrastructure. Here are some notable upcoming BESS projects:

Sierra Estrella Project

Developer: Plus Power.

Capacity: 250 MW.

Location: Arizona.

Utility: Part of the Salt River Project's (SRP) efforts to reach 800 MW of energy storage contracted or owned.

Read: Arizona’s Largest Battery Energy Storage System is Now Online: The Project will Supply Power to Google

Superstition Energy Storage

Developer: Plus Power.

Capacity: 90 MW.

Timeline: Expected to be built in Gilbert, Arizona.

Utility: Another project by SRP

Read: Neoen Wins Contract to Build Second Largest BESS Project in Canada

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