D. E. Shaw Renewable Investments (DESRI) is seeking a loan from the North American Development Bank (NADBank) to put towards the construction of a 150MW hybrid solar and BESS project located near the US-Mexico border in Doña Ana County, New Mexico.
A copy of DESRI’s certification and financing proposal for its Santa Teresa Solar and Storage project was posted on NADBank’s website on 12 January 2025, which is now subject to a 30-day public comment period.
Founded in 1994, NADBank is a financial institution owned equally by the government’s of the US and Mexico that issues funding for environmental infrastructure projects along the border. In September last year, the binational institution approved a loan of up to US$60 million to Canadian Solar subsidiary Recurrent Energy.
As reported by Energy-Storage.news, the loan will be used by the independent power producer (IPP) to fund the construction of a 100MW/200MWh standalone storage facility located in Maverick County, Texas, known as Fort Duncan BESS.
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Santa Teresa Solar and Storage
DESRI’s Santa Teresa project will comprise a 150MW solar farm co-located with a 150MW/600MWh BESS across 970 acres of privately-owned land approximately one mile north of the US-Mexico border and five miles west of El Paso, Texas.
According to DESRI’s proposal, the BESS will be made up of 156 battery units utilising lithium iron phosphate (LFP) cell chemistry battery technology. The project is expected to connect to the grid through El Paso Electric’s (EPE’s) Verde substation via a 0.7-mile long 115kV gen-tie line.
Construction on the project will be carried out under two engineering, procurement and construction (EPC) contracts with the same firm that DESRI is currently negotiating, with one agreement focusing on the solar farm and ancillary equipment and the second aimed at the BESS.
DESRI is also currently negotiating a long-term service agreement (LTSA) with a third-party to maintain the BESS for the entire duration of the project.
The project is scheduled to come online during June 2026 with construction estimated to take 18 months to complete.
NADBank sees ‘acceptable level of risk’ in US$80 million loan
DESRI is seeking up to US$80 million in non-recourse finance, or a limited-recourse senior secured loan, to fill a gap in the financing needed for the construction of the project, until it can secure further investment nearer the commercial operation date (COD).
According to analysis carried out by NADBank, it considers the Santa Teresa project to be financially feasible and an ‘acceptable level of risk.’ Although repayment details weren’t specified, NADBank said the mechanism for the loan is ‘standard for similar hybrid solar and energy storage transactions in the US.’
DESRI expects to pay the loan back through revenue obtained from the sale of power, renewable energy credits (RECs), income tax credits, and any offtake agreements it secures.
Project misses contractual online date
Initial development of project was completed by Chicago, Illinois-based developer Hecate Energy, which secured power purchase agreements (PPAs) with EPE covering 100MW and 50MW of solar output from the Santa Teresa project back in 2019 and 2020.
After Hecate Energy experienced delays to its project schedule due to supply-chain shortages, the developer and EPE amended the PPAs extending the contractual online deadline for the Santa Teresa project to June 2024.
Despite the extension, Hecate failed to bring the projects online before the contracted online date, and the PPAs were terminated during October 2024. According to documents filed this month with the New Mexico Public Regulation Commission (NMPRC), EPE is in the process of collecting security from Hecate Energy after the developer failed to meet the contractual deadline.
Hecate Energy sold the Santa Teresa project to DESRI also in October 2024, which is now proposing to add the 150MW of storage output and 600MWh capacity (4-hour duration) to the project.
DESRI storage developments in the US
Elsewhere in the US, DESRI is developing a hybrid solar and BESS project in Buckeye, Arizona that it purchased from utility-scale developer Avantus during the final quarter of last year, as reported by Energy-Storage.news.
The Catclaw Solar and Storage project will feature a 225MWac solar farm co-located with a 250MW/1,000MWh BESS. Contracted for offtake with utility Arizona Public Service (APS), like the Santa Teresa project it is also expected to come online during 2026.
Since its inception in 2010, DESRI claims to have built a portfolio exceeding 11GW of generation capacity across 24 US States. Announced initially during September 2024, Australia’s Macquarie Asset Management (MAM) last week closed on a deal to acquire a minority stake in DESRI in a deal worth up to US$1.73 billion.
