Spearmint Secures $250 Million for New Texas Energy Storage

Spearmint Energy closes more than $250 million to complete two large-scale battery projects as the Texas power grid makes an important transition. Set to be the largest utility-scale BESS deployment in ERCOT, Tierra Seca and Seven Flags provide 400 megawatt-hours (MWh) of energy storage combined. In simpler terms, for average Texans, that spells a more reliable power supply during peak demand when the grid is under the most stress.

These utility-scale Battery Energy Storage Systems (BESS) serve as a sort of giant safety net for homes and businesses across the state, storing excess power that can be released to the grid when needed. The two sites are already under construction and are expected to begin operations later this year.

Why are these battery projects such a big deal for Texas?

The existing infrastructures often fail to meet real-time energy demands in Texas, which have been continually increasing. If demand continues to grow faster than supply, it will destabilize the grid. Spearmint Energy is addressing this shortcoming with two new projects in Del Rio and Laredo, both of which will add 200 MW of capacity directly to the ERCOT grid.

These batteries serve not only to compensate for energy but also to improve the overall efficiency of the entire system. When operated and capitalized upon correctly, these systems capture power when it is cheap and abundant (often captured from renewables) before discharging that energy during periods of supply shortage; effectively balancing grids through electricity availability at an affordable price. Transitioning to large-scale storage of this nature is an important part of Texas updating its operations and practices regarding the energy sources that will inevitably power its future, so-called “next-generation” energy.

How was the $250 million agreement structured?

Developing advanced energy infrastructure is a capital-intensive process. On the other hand, Spearmint Energy secured a diverse $250 million package from a handful of global powerhouses in the investment sector. The funding can be divided into three main categories:

• Construct-to-Perm Loans, Funded: $59 million from Manulife
• Tax Equity Bridge Loans: $95 Million from East West Bank and Investec
• Tax Equity Commitments: $98 million from Sugar Creek Capital.

This massive investment reflects a high level of confidence in the future of battery technology.

“We are thrilled to secure this financing…which demonstrates the confidence world-class investors have in Spearmint’s ability to develop and efficiently operate grid-scale energy storage infrastructure.”

Andrew Waranch, Founder and CEO of Spearmint Energy

Who are behind the Tierra Seca and Seven Flags sites?

Spearmint Energy is working with experienced veterans to make sure the projects are class A. M.A. Mortenson Company, an industry leader in power engineering and construction, is constructing the sites.

The projects will use the Power Titan 2.0 platform to store the real muscle. The system in the District’s new multilevel battery and inverter facility represents cutting-edge technology from Sungrow Power Supply, a global leader in energy storage. Leveraging these leading-edge tools, Spearmint will help ensure that the Del Rio and Laredo facilities are equipped with the most effective available hardware in today’s market.

What is the future of ERCOT?

Through fast financing and expedited construction, these projects are poised to change the energy landscape of Texas. As more projects like Tierra Seca and the recently announced Seven Flags come online, the grid will rely less on old, “always-on” plants and be better-equipped to handle the ebbs of modernity.

Spearmint’s Chief Financial Officer, Cory Magnuson, noted that partnering with globally recognized investors like Manulife and East West Bank helps the company fulfill its mission: providing safe, stable, and affordable power to everyone in the region. With legal guidance from firms like Paul Hastings and Milbank, the deal was finalized to keep these projects on track for their year-end launch.