Ørsted Closes $680M Equity Financing for Solar and Storage Portfolio

Ørsted, a US clean energy developer, announced a $680 million investment by JP Morgan in tax equity financing for a portfolio of solar and storage assets in Texas and Arizona.

The project portfolio includes Eleven Mile Solar Center, a 300 MW solar project with 300 MW/1,200 MWh storage in Pinal County, Arizona, and Sparta Solar, a 250 MW solar project in Mineral, Texas.

This transaction represents one of the largest solar and storage tax equity transactions utilizing a combined Production Tax Credit (PTC) and Investment Tax Credit (ITC) since the passage of the Inflation Reduction Act (IRA) in August 2022 . Eleven Mile Solar Centrum will receive a one-time investment tax credit for its battery energy storage system, and the solar farm will generate production tax credits for a period of ten years.

The tax equity partnership with J.P. Morgan includes a tax credit carryover option. This new tax credit rollover option created by the IRA has opened up a new market for any corporate buyer to support clean energy projects and optimize their federal tax bills by purchasing tax credits.

“Örsted is an experienced developer and operator of renewable energy projects in the U.S., including offshore and onshore wind, solar and battery storage, all of which will provide tax benefits to investors.” said James Giamarino, commercial director for the Americas at Ørsted. “With this new market unlocked by the IRA, we are excited to continue our partnership with J.P. Morgan for tax equity and attract new entrants who want to grow the U.S. renewable energy industry, support job growth and promote local economic development.”

The tax equity investment will help finance the implementation of both projects, which include a total of 550 MW of photovoltaic capacity and 300 MW of batteries with a 4-hour discharge capacity (1,200 MWh). Commercial operations of both projects are expected to begin in 2024. The agreement also builds on JP Morgan’s existing investment in 1.8 GW of Ørsted’s total 5.7 GW onshore portfolio in the United States.

By the end of 2024, Ørsted will have a portfolio of solar projects generating 2 GW of power across the United States. Sparta Solar is part of the Helena Energy Center, a 518 MW combined wind-solar project in Bee County and Ørsted’s first co-located wind-solar project. Additionally, Eleven Mile Solar Center is Ørsted’s first project in Arizona. The solar projects will provide a total of $125 million in tax revenues over the life of the projects for public services in local communities.