First Citizens Bank Serves as Sole Bookrunner and Co-Lead Arranger on $150 Million in Financing for Battery Energy Storage Projects

Rhea-AI Summary

First Citizens Bank's Energy Finance business has arranged over $150 million in financing for two Apex Clean Energy battery energy storage projects in Texas. The projects, Great Kiskadee Storage and Angelo Storage, each feature a 100MW/200MWh battery system and are currently under construction. Both are scheduled to begin operations by Q3 2024. Bank United also served as a co-lead arranger. Apex Clean Energy, established in 2009 and based in Charlottesville, Virginia, focuses on utility-scale renewable energy projects. First Citizens Bank highlighted the significance of battery storage for resilient and cost-effective renewable energy grids. The collaboration is expected to enhance future opportunities between the two companies.

Positive

• First Citizens Bank arranged over $150 million in financing for battery energy storage projects.
• Two projects, Great Kiskadee Storage and Angelo Storage, involve significant 100MW/200MWh battery systems.
• Both projects are due to start commercial operations by Q3 2024, indicating imminent revenue generation.
• Partnership with Apex Clean Energy, a reputable player in renewable energy, enhances First Citizens Bank's credentials in the sector.
• First Citizens Bank Energy Finance unit's expertise in renewable energy financing is recognized.
• The projects aim to enhance the grid's resilience and cost-effectiveness, supporting the global shift to renewable energy.
• Opportunity for further collaboration with Apex Clean Energy may lead to additional business ventures.

Negative

• The projects are still under construction, indicating potential risks and uncertainties until completion.
• Dependence on timely completion for revenue; any delays beyond Q3 2024 could negatively impact expected financial returns.
• Heavy reliance on Apex Clean Energy's execution capabilities poses a risk if the projects face operational issues.

Insights

Financial Analyst

First Citizens Bank's role as the sole bookrunner and co-lead arranger of $150 million financing for two battery energy storage projects by Apex Clean Energy is indicative of substantial confidence in the renewable energy sector. Battery storage systems like the ones financed are essential for stabilizing and optimizing the grid, particularly as reliance on intermittent renewable energy sources increases.

The financial commitment towards the Great Kiskadee Storage and Angelo Storage projects underscores the growing investment appeal in battery storage technology. Both projects are expected to be operational by Q3 2024, which suggests a short-term positive impact on Apex Clean Energy’s operational capabilities and potential revenue generation.

Given First Citizens Bank's involvement, it is clear that they see a high potential return on investment in these projects. Additionally, the collaboration with Bank United highlights a diversified risk approach. For investors, this financing deal highlights a growing trend towards substantial investments in green technologies, which could translate into long-term growth for companies like Apex.

Energy Market Analyst

Battery energy storage systems are becoming pivotal in the energy sector. They offer solutions for energy storage that are important for managing the supply and demand of electricity, especially with the rise of renewable energy sources like wind and solar. The 100MW/200MWh capacity of each project financed by First Citizens Bank is substantial and indicates a significant addition to the energy storage capability in Texas.

This funding reflects a strategic move to enhance grid resilience and efficiency. For retail investors, understanding that these projects will directly contribute to a more stable and efficient energy grid can highlight the potential for increased valuation in companies involved in energy storage. This also aligns with broader industry trends towards sustainability and decarbonization.

The involvement of major players like First Citizens Bank and Apex Clean Energy further legitimizes the investment potential in this sector. This move also suggests that battery storage technology is reaching a level of maturity and reliability that makes it a viable and attractive investment option.

NEW YORK, May 14, 2024 /PRNewswire/ -- First Citizens Bank today announced that its Energy Finance business served as sole bookrunner and co-lead arranger on financings totaling more than $150 million for two Apex Clean Energy ("Apex") battery energy storage projects in Texas.

One project, Great Kiskadee Storage, is a 100MW/200MWh battery energy storage system owned by SA Grid Solutions (a joint venture of Apex, SK Gas, and SK Eternix) and under construction in Hidalgo County, Texas. The other, Angelo Storage, is a 100MW/200MWh battery energy storage system, also under construction, in Tom Green County, Texas.

Both are expected to reach commercial operation by the third quarter of 2024. Bank United also served as co-lead arranger on the financings.

Founded in 2009 and headquartered in Charlottesville, Virginia, Apex Clean Energy focuses on the origination, construction and operation of utility-scale wind, solar and battery storage projects, distributed energy resources, and green fuel technologies.

"Battery storage is crucial to building a more resilient grid and enhancing the reliability and cost-effectiveness of renewable energy—ultimately enabling our mission to accelerate the shift to clean energy," said Ken Young, Apex Clean Energy CEO. "We greatly appreciated the industry knowledge and expertise of the First Citizens Energy Finance team in helping arrange these financings."

"Apex Clean Energy has a strong and growing reputation throughout the renewable energy industry for identifying attractive clean energy project opportunities and managing them to successful completion," said Mike Lorusso, managing director and group head for First Citizens Energy Finance. "It was a pleasure to work with them on this financing and we look forward to further opportunities to collaborate in the future."

First Citizens Energy Finance leverages its deep industry knowledge and expertise to offer comprehensive financing solutions for renewable and conventional power generation. The unit manages a large, diverse portfolio that includes investments in all asset classes across the energy sector.

About First Citizens Bank
First Citizens Bank helps personal, business, commercial and wealth clients build financial strength that lasts. Headquartered in Raleigh, N.C., First Citizens has built a unique legacy of strength, stability and long-term thinking that has spanned generations. First Citizens offers an array of general banking services including a network of more than 500 branches and offices in 30 states; commercial banking expertise delivering best-in-class lending, leasing and other financial services coast to coast; innovation banking serving businesses at every stage; and a nationwide direct bank. Parent company First Citizens BancShares, Inc. (NASDAQ: FCNCA) is a top 20 U.S. financial institution with more than $200 billion in assets. Discover more at firstcitizens.com.

MEDIA RELATIONS:
John M. Moran
212-461-5507
john.moran2@firstcitizens.com

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SOURCE First Citizens Bank

FAQ

What is the financing amount arranged by First Citizens Bank for the battery energy storage projects?

First Citizens Bank arranged over $150 million in financing for the projects.

What are the names and specifications of the battery energy storage projects financed by First Citizens Bank?

The projects are Great Kiskadee Storage and Angelo Storage, each featuring a 100MW/200MWh battery system.

When will the battery energy storage projects start operations?

Both projects are expected to begin commercial operations by Q3 2024.

Who co-lead arranged the financings with First Citizens Bank?

Bank United served as a co-lead arranger on the financings.

What is Apex Clean Energy's role in these projects?

Apex Clean Energy is part of the joint venture SA Grid Solutions, which owns the Great Kiskadee Storage, and is managing both projects.

What is the significance of battery storage in renewable energy?

Battery storage is important for building a resilient grid and improving the reliability and cost-effectiveness of renewable energy.

What expertise does First Citizens Bank contribute to renewable energy projects?

First Citizens Bank leverages deep industry knowledge and expertise in comprehensive financing solutions for renewable energy projects.