London’s BESS targets 100MW with ‘landmark’ US$40m Santander investment

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Santander Corporate & Commercial head of infrastructure and renewable energy, Howard Whitehead called it a “landmark transaction with a new client in a new niche market segment”. Image: Getty Images.

Battery Energy Storage Solutions (BESS) an independent system solutions and flexibility services provider, has taken in more than US$100 million in outside investment since November, with plans to target 100MW of UK projects.

At the end of last week, a spokesman for BESS emailed Energy-Storage.News to say that the company had netted £28.5 million (US$39.28 million) in project finance funding from an arm of Spanish banking group Santander.

BESS said it wants to become “one of the UK’s largest independent owners and operators of battery storage assets”, with the company, only launched in March last year, setting a target of building and operating a 100MW portfolio of energy storage assets by the end of 2018.

Last November, the company raised £50 million (US$66.18 million) of investment led by Tiger Infrastructure Partners, a New York-headquartered fund focusing on energy, transport and communications. At the time that was announced, BESS co-founder James Basden said the investment demonstrated the “credibility” of the company’s proposition and would be used to fulfil existing behind-the-meter project contracts as well as for grid-scale storage site acquisition.

On the latest investment, which came from Santander Corporate & Commercial, Basden’s co-founder Nicholas Beatty said the pace of the UK’s transition to cleaner energy is posing a second-by-second balancing challenge for transmission system operator National Grid. Beatty said he believed only “new technologies like energy storage” could help Britain meet this challenge effectively.

Santander Corporate & Commercial head of infrastructure and renewable energy, Howard Whitehead, called it a “landmark transaction”.

“We are delighted to have closed this landmark transaction with a new client in a new niche market segment: project finance for battery storage,” Whitehead said.

“We believe we are one of the first senior debt lenders to close a project finance transaction in this space, a fact which underscores Santander’s desire to be a leader in this fast developing sector.”

BESS had targeted the development and completion of 63MW of projects by the end of 2017 originally. The company currently has 14MW of grid-scale batteries owned and in operation and expects the remaining 49MW in that ‘pipeline’ to be up and running by the end of this month. The 63MW is distributed across eight project sites.

Few details were given about projects under development, or being considered. However BESS’ website says the company “provides frequency balancing services today and will soon be financing and operating assets in a range of new applications”. The Santander side of the deal was supported by UK specialist law firm TLT, while BESS was supported by law firm Burges Salmon and corporate and asset-backed financing company Evergreen Capital. 

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