In a significant move that underscores the growing confidence in battery energy storage systems (BESS), BW ESS has secured debt financing for its operational 100MW/331MWh BESS in Bramley, Hampshire, UK. This deal, split evenly between Australian bank Westpac and Singapore-headquartered UOB, marks a pivotal moment in the energy sector, reflecting the increasing recognition of BESS’s strategic importance in grid stability and energy transition.
The Bramley BESS, inaugurated in February, has already proven its mettle, consistently ranking as one of the UK’s largest single sources of energy storage capacity. This success is largely attributed to its market-first seven-year tolling agreement with Shell Energy Europe, which provides a robust long-term revenue model. The project’s technical quality and strategic significance to the UK grid made it a highly competitive financing process, drawing substantial interest from the lending community.
Marc Weisser, CFO of BW ESS, expressed his satisfaction with the outcome, stating, “Bramley is a flagship asset in our growing UK portfolio. We were nonetheless encouraged by the exceptionally high level of interest the project generated from the lending community.” He further commended the chosen lending partners, noting, “We couldn’t be happier with our final choice of lending partners; both UOB and Westpac have demonstrated a firm commitment to supporting the global rollout of strategically significant BESS projects and share our interest in unlocking the value of energy storage.”
The financing deal is not just a win for BW ESS but also a testament to the lenders’ commitment to sustainable energy solutions. Sarah Heavey, Westpac’s Head of Energy, Infrastructure & Resources, highlighted the strategic importance of the project, saying, “This is an important milestone in longer duration energy storage, providing additional resilience to the UK’s grid as the country makes further progress on its strategic energy transition journey.”
Edmund Leong, Head of Group Corporate Banking, UOB, echoed this sentiment, emphasizing the project’s innovative and sustainable aspects. “This landmark green project financing, for one of the UK’s largest BESS projects, also showcases UOB’s sector expertise, as we structure and support the growth of BESS project financing worldwide.”
This deal is BW ESS’ second external financing closed in recent weeks, following a loan agreement with Nordea Bank to finance its 211MWh Swedish energy storage portfolio. This flurry of activity suggests a bullish outlook for the energy storage sector, with major financial institutions increasingly willing to back large-scale BESS projects.
The Bramley deal could set a precedent for future BESS projects, demonstrating the viability of long-term revenue models and the strategic value of energy storage in grid management. As the UK and other countries push forward with their energy transition journeys, such projects will play a crucial role in ensuring grid stability and resilience. The involvement of international lenders like Westpac and UOB also signals a growing global interest in the UK’s energy storage market, which could attract more investment and accelerate the sector’s growth.
Moreover, the deal challenges the norm of short-term revenue models in the energy sector, showcasing the potential of long-term agreements in securing financing for large-scale projects. This could spark a debate on the optimal revenue models for energy storage projects and their role in attracting investment. As the energy sector continues to evolve, such innovative financing deals will be key in driving the transition to a more sustainable and resilient energy future.