Scale Microgrids to build solar-storage renewables project for California Native American community


Scale Microgrids Solutions will build a renewables microgrid for a Native American tribe in California, announcing the new project a few weeks after securing a US$225 million debt facility.

The company will build and install a microgrid pairing 1.5MW of rooftop solar and a 6MWh energy storage system for the Soboba Band of Luiseño Indians. The tribe is based in Riverside County, California, and the project will be installed at its Soboba Casino Resort.

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Scale said that tribal communities historically suffer from higher service costs, higher interconnection fees, more blackouts or brownouts and remote and distant service locations.

“The impact of the Soboba Microgrid project goes beyond kilowatt-hours and savings. It secures the community’s long-term energy sovereignty and will inspire more public and private sector distributed energy development efforts on tribal lands,” said Guillermo Gomez, business development manager at Scale Microgrids.

The project is very similar in scope to one on which reported a few months ago, also being deployed for a Native American community in California. That 60MWh project for the Viejas Tribe of Kumeyaay Indians combines technologies from long-duration energy storage (LDES) firms Invinity and Eos Energy Enterprises.

In an interview about the project, the Viejas Tribe Chairman John Christman told that the plan was to eventually take the community off-grid.

Casino resorts serve as the economic lifeblood of many of these Native American communities and provide critical services during grid outages. Scale will provide 24/7/365 on-site and remote monitoring for the project.

“This project serves our mission to strengthen our tribe’s sovereignty, self-sufficiency, and prosperity,” said Soboba’s Tribal Council. “We are responsible for helping our people and our land thrive for generations to come, and we believe this microgrid system is an important step towards advancing our objectives.”

Scale’s development team secured funding for more than half of the project costs from California’s Self Generation Incentive Program (SGIP) and the Direct Pay Investment Tax Credit (ITC). Direct Pay means getting cash payments instead of an ITC, the latter of which reduces your tax liabilities and requires tax equity financing to get.

The Direct Pay for tax credits was brought in by the Inflation Reduction Act specifically to allow non-tax paying entities to benefit from clean energy credits, so is only available to them. According to law firm Arnold & Porter, this includes tax-exempt organisations, states, political subdivisions, Indian Tribal governments, Alaska Native Corporations, rural electricity cooperatives and the Tennessee Valley Authority, while pension and endowment funds may also qualify.

Some industry sources have speculated that this means these types of organisations will eventually become the biggest owners of renewable energy assets in the US.

The announcement comes a few weeks after Scale Microgrids Solutions announced it had secured a US$225 million debt facility arranged by KeyBanc Capital Markets and City National Bank. The company is owned by global private equity firm Warburg Pincus.

“We thank our partners KeyBanc Capital Markets and City National Bank for demonstrating leadership in the commercial banking sector with the closing of this debt facility. With the closed facility, Scale has increased its access to the debt capital markets, which is a cornerstone of our strategy to deliver microgrids and distributed energy projects at favorable rates,” said Julian Torres, chief financial officer at Scale Microgrids.

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