Ørsted aims to have 2GW of solar capacity in operation in the US by the end of 2024. Image: Ørste
Danish power company Ørsted has closed a US$680 million tax equity financing with US investment bank JP Morgan for a solar project, alongside a solar-plus-storage project, in the US.
The portfolio consists of two projects: the Eleven Mile Solar Center, which comprises a 300MW solar facility and a 300MW/1,200MWh storage project with a 4-hour duration in Pinal County, Arizona; and the Sparta solar project, a 250MW solar farm in Mineral, Texas. Ørsted expects both projects to reach commercial operation in 2024, and by the end of the year the company aims to have 2GW of solar capacity in operation in the US.
The company will also build the Sparta project alongside its Helena Energy Center, a 518MW solar-plus-wind project that is Ørsted’s first co-located wind and solar project.
The Eleven Mile project will benefit from some of the supportive investment opportunities provided by the Inflation Reduction Act (IRA) in the US, with its solar component to generate production tax credits (PTCs) over the next ten years, while its storage component will receive a one-time investment tax credit (ITC).
The companies also announced that the deal includes the option for tax credit transferability, another new IRA mechanism to make ITCs easier to trade between companies. Financing firm Evergrow completed the first such transfer transaction in October last year, and Carl Fleming of law firm McDermott Will & Emery told PV Tech Premium that such mechanisms will drive a new wave of “mega” deals in the US solar space.
“With this new market unlocked by the IRA, we’re excited to continue our tax equity partnership with JP Morgan and bring on new entities looking to advance the US renewable energy industry, support job growth and promote local economic development,” said James Giamarino, chief commercial officer for the Americas at Ørsted.
Last December, Ørsted announced that it had signed a power purchase agreement (PPA) with social media and data giant Meta to sell “the majority” of power generated from the Eleven Mile project.
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