H.I.G. Capital-backed energy platform, Greenflash Infrastructure, has closed a hybrid tax capital and debt financing for Project Soho, a 400MW/800MWh standalone battery storage project in Brazoria County, Texas.
Greenflash claims the project is the largest standalone battery energy storage system (BESS) currently under construction in Texas and is ahead of schedule to energise in Q1 2026 and achieve commercial operations in Q2 2026.
The transaction included a preferred equity investment from funds managed by Wafra, a global alternative investment manager.
Acadia Infrastructure Capital, a North American power infrastructure investment manager, invested preferred equity in Project Soho alongside Wafra.
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The preferred equity investment is designed to enable a tax credit sale to an unnamed, “leading” US-based insurance firm.
The transaction also involved debt financing arranged by Deutsche Bank, which acted as the coordinating lead arranger and sole bookrunner. Deutsche Bank Trust Company Americas served as the administrative agent, collateral agent, and depositary bank.
Chris McKissack, CEO of developer Fullmark Energy, speaking with Energy-Storage.news in a recent interview, said that Texas and California have been “really good proving grounds” for energy storage technology.
McKissack continued, “Now you have to be good at what you’re doing. You can’t just show up. Differentiating by how you operate, what kind of cost you’re getting from your battery suppliers, how you’re doing your O&M, how you’re doing your offtake, how you’re bidding and dispatching in the model, starts to make a real difference between projects and portfolios.”
Greenflash will be operating its project Soho in the increasingly saturated Electric Reliability Council of Texas (ERCOT) market.
In a guest blog for ESN Premium, Ali Karimian and Alden Phinney of GridBeyond, noted that:
“While ancillary services-focused approaches delivered solid returns in ERCOT during 2023, and basic charge low/ discharge-high strategies worked effectively in CAISO, the rapid deployment of BESS assets has created intense competition, which demands sophisticated optimisation to capture excess returns beyond market benchmarks.”
“To remain competitive, battery storage operators must transition from basic arbitrage strategies to highly optimised, integrated solutions that capture returns that outperform the benchmark when adjusted for risk (what the financial world calls alpha).”
Greenflash and other companies must navigate an increasingly complex market as additional storage resources are incorporated, to demonstrate their long-term sustainability.
