Owners of the Melbourne Renewable Energy Hub (MREH) have closed the largest non-recourse debt financing package for an Australian grid-scale battery energy storage system (BESS), raising $400m from a debt syndicate comprising Export Development Canada, Societe Generale, Standard Chartered, and Westpac (MREH Debt Financing).
Equis Australia and Victoria’s newly formed SEC have secured the landmark debt transaction as the first financial close of a 4-hour BESS in Australia’s National Electricity Market (NEM).
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The MREH Debt Financing will finance the construction of the 200MW/800MWh BESS project which the SEC will be responsible for operating (MREH A3).
Melbourne Renewable Energy Hub comprises three projects of 200MW each including MREH A3 and is Australia’s largest BESS once all stages are fully built. Melbourne Renewable Energy Hub connects to the NEM’s high voltage 500kV transmission system, allowing a volume of electricity to be rapidly dispatched that is unmatched by other battery storage systems.
Once complete, Melbourne Renewable Energy Hub will provide 1.6GWh of energy storage, enough to power up to 200,000 homes during peak periods.
The project is a co-investment partnership with the SEC—a Victorian Government-owned renewable energy company working to deliver renewable, affordable, reliable energy for all Victorians and gives Victorians a direct stake in the state’s renewable energy future.
Once MREH A3 is completed in 2025, the SEC will manage market operation, providing firming services to support the SEC’s supply of electricity to Victorian Government customers.
“We have found the equity partnership model to be a very effective vehicle for government industry collaboration to bring forward renewable energy projects,” Equis co-founder and managing director David Russell said.
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“We think this model should be considered by other state governments because it allows their investments to earn sustainable returns that can be reinvested in further renewable energy initiatives.”
Equis has completed 116 solar projects and 76 wind projects across eight Asia Pacific countries, including Australia, totalling 15.4GW for Equis Energy (now Vena Energy) and a further 2.2GW across other platforms.
