Santander Invests £28.5 Million In Battery Energy Storage Solutions
Spanish banking giant Santander has announced this week it will invest £28.5 million into London-based Battery Energy Storage Solutions for the express purpose of building and operating a grid-scale battery storage portfolio of 100 megawatts by the end of the year.
Battery Energy Storage Solutions (BESS), a London-based independent provider of power storage, energy security, and energy flexibility services, owns and operates five operational sites in the UK and boasts a large pipeline of projects for imminent delivery. The company was only formed in March of 2017 by leading energy storage executive experts, and as of the end of 2017 the company owned and operated 14 megawatts (MW) worth of grid-scale battery storage projects, and had a further 49 MW worth of grid-connected batteries to be connected by the end of this month.
Santander UK, the UK subsidiary of Spanish banking giant Santander Bank, N. A., announced last week that it was committing £28.5 million to BESS in an effort to support the company’s plans to become one of the UK’s largest independent owner-operators of battery storage assets and to meet their short-term strategy of building and operating a portfolio of 100 MW worth of grid-scale battery storage assets by the end of 2018.
The timing of Santander’s investment — and that of the creation of BESS itself — stems from efforts to capitalize on the booming energy efficiency and energy storage industries across the UK. Battery storage technologies are also obviously tailor-made to partner with renewable energy technologies, which have similarly exploded in the UK over the last few years, and in 2017 the country broke 13 separate records, including the first 24-hour period without coal-generated power, the first time that wind, nuclear, and solar produced more than coal and gas, and the “greenest summer” with 52% of electricity generated from low-carbon sources.
“The UK’s power system is now the fourth cleanest in Europe,” said Nicholas Beatty, co-founder of Battery Energy Storage Solutions. “However, the pace of transition to a low carbon power system brings with it challenges for the National Grid in balancing the network and ensuring supply and demand is matched on a second by second basis. Such balancing of supply and demand only being possible by the introduction of new technologies like battery storage. We believe our company is uniquely placed to capture that market demand. We value the guidance and support provided by the Santander deal team in this complex transaction.”
“We are delighted to have closed this landmark transaction with a new client in a new niche market segment: project finance for battery storage,” said Howard Whitehead, Head of Infrastructure & Renewable Energy, Santander Corporate & Commercial. “We believe we are one of the first senior debt lenders to close a project finance transaction in this space, a fact which underscores Santander’s desire to be a leader in this fast developing sector.”
“With the combination of both equity and Santander debt, BESS and its highly experienced management team are now able to execute the strategy of becoming one of the UK’s largest independent owners and operators of battery storage asset portfolios, underpinned with contracts with the National Grid,” added Mark Cumbo, Director, Infrastructure & Renewable Energy, Santander Corporate & Commercial, who led the deal team.
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