Advisement by our law firm on the financial arrangements for Atmos Renewables' Merredin Battery Energy Storage System project
In a significant move towards the future of renewable energy, Atmos Renewables, a company fully owned by infrastructure funds managed by Igneo Infrastructure Partners, has embarked on its first Battery Energy Storage System (BESS) project in Western Australia. This project, the Merredin BESS, is expected to be the first in the region to be constructed under the Australian Government's Capacity Investment Scheme.
The Merredin BESS project, co-developed with Nomad Energy, has a capacity of 100 MW/400 MWh and is strategically located approximately 230 kilometres east of Perth. Upon completion, it is anticipated to enhance the security of supply in the Western Australian Electricity Market.
White & Case LLP, a global law firm, advised Atmos Renewables on the project financing of the Merredin BESS. The transaction, which was completed on 30 June, saw a collaborative effort from the White & Case team, including partners Chris Settle (Melbourne), Tim Kennedy and Alicia Albury (both Sydney), counsel Suzanne Rizk and Jenny Lo (both Sydney), and associates Laurence Judges, Kirsten Sugden, Brittany Garagounis, Shruti Sudarsan, Alistair Leung, Shika Hegde (all Sydney), Alice Noonan, Meryl Liew, and Mikayle Page (all Melbourne).
The trend towards portfolio financing for greenfield projects, as demonstrated by the Merredin BESS case, is a growing phenomenon in the renewable energy sector. This approach involves bundling multiple early-stage or geographically distributed renewable projects into a single financing package rather than seeking capital project-by-project.
Key reasons for this trend include risk mitigation, capital access and scale, and alignment with emerging financing models. Portfolio financing spreads development risk across multiple projects, benefiting first-of-a-kind projects that face higher uncertainties and development hurdles. By financing a portfolio of projects simultaneously, developers can achieve scale that attracts a broader range of investors and reduces transaction costs associated with individual project financing.
Moreover, this trend aligns with broader shifts in renewable energy finance where investors increasingly seek structured vehicles that optimize returns and incorporate ESG considerations. Portfolio approaches can also better incorporate storage assets and new business models that enhance project bankability and revenue stability.
While the provided search results do not explicitly mention Atmos Renewables and the Merredin Battery Energy Storage System, they highlight relevant market dynamics such as a growing role of energy storage, the importance of de-risking first-of-a-kind projects, and changing investor preferences towards bundled or catalytic investments in renewables. These factors support portfolio financing becoming more prevalent for greenfield renewable energy developments to efficiently manage risk, scale, and capital access.
The Merredin BESS project is expected to provide crucial grid network support with its 100 MW battery offering four hours of storage. The project's success underscores the potential of portfolio financing for greenfield renewable energy projects and the growing trend towards clean energy asset development in Western Australia.
- The Merredin BESS project, co-developed with Nomad Energy, is significant with a capacity of 100 MW/400 MWh and strategic location.
- White & Case LLP acted as advisors for Atmos Renewables on the project financing of the Merredin BESS.
- The transaction involved partners, counsel, and associates from White & Case's team in Melbourne and Sydney.
- The trend towards portfolio financing, shown by the Merredin BESS case, is growing in the renewable energy sector.
- Key reasons for this trend are risk mitigation, capital access and scale, and alignment with emerging financing models.
- Portfolio financing can benefit first-of-a-kind projects and achieve scale that attracts more investors.
- This trend aligns with broad shifts in renewable energy finance, where investors seek structured vehicles that optimize returns and incorporate ESG considerations.
- The Merredin BESS project's success underscores the potential of portfolio financing for greenfield renewable energy projects and the trend towards clean energy asset development in Western Australia.
