Canadian power generation company Northland Power has closed financing for its Oneida energy storage project in Haldimand County, Southern Ontario, Canada.
Oneida is a 250MW/1,000MWh advanced-stage, grid-connected lithium-ion battery storage project. It is said to be the largest clean energy storage project in the country.
Northland Power currently owns 72% of the project, being developed in partnership with NRStor, Six Nations of the Grand River Development Corporation and Aecon Group.
Oneida represents the company’s first investment in an energy storage project.
It would cost around $0.8bn, with full commercial operations expected to commence in 2025.
The project is backed by a 20-year capacity contract with an Independent Electricity System Operator (IESO) in Ontario.
Once fully operational, Northland’s share in the project is expected to contribute about $40m to $45m to the company’s financial results each year over the first five years.
Northland Power president and CEO Mike Crawley said: “Today’s announcement is a significant milestone for the Oneida project and a key step in Northland’s strategy of developing and operating battery storage facilities which will play a key role in providing stability and reliability to energy grids.
“Oneida provides Northland with size and scale in Ontario from which we can grow. We will look at further development opportunities within energy storage as part of our overall ambition to help accelerate the global clean energy transition.”
Northland Power will use non-recourse project-level financing to fund about 75% of the project development costs as part of its financing strategy.
The company will fund the equity component of the financing from existing cash on hand and available liquidity under its revolving credit facility.
An external lender has fully committed to providing the total debt required for the project in the form of a non-recourse construction and term loan, matching the tenor of the capacity contract.
Furthermore, Natural Resources Canada (NRCan) is funding the project under its Smart Renewables and Electrification Pathways programme.
