This is a 205 MW / 551.65 MWh DC utility-scale battery energy storage project located in Midland County, Texas, featuring a 2.7-hour discharge duration on DC nameplate. The system utilizes 110 Tier-1 U.S.-manufactured LFP battery containers (5.015 MWh each, produced in the Midwest) paired with utility-grade medium-voltage conversion stations, constructed under the supervision of a leading national balance-of-plant EPC contractor by discipline and specialized civil works partners. Capacity retention adheres strictly to the original equipment manufacturer’s technical-proposal degradation curve, reaching 66.6% of initial nameplate capacity in Year 20 with no mid-life augmentation.
The sponsor team’s experience spans C&I, distributed generation and utility-scale renewable projects, including EPC and project execution, development, commercialisation and asset management across US energy markets.
Total CapEx is $154.6 million, or $280 per kWh of DC nameplate, with the $12.8 million Oncor network upgrade carried outside CapEx as a separate project cost. Total uses at commercial operation are $197.9 million, funded by $63.3 million of senior term debt, a $49.4 million ITC bridge and $85.2 million of equity – a 42.6% / 57.4% debt-to-equity split of permanent capital. Senior debt is sized on the contracted Nephila floor case at a 1.20x minimum debt-service coverage ratio. During construction, equity funds the milestone draws in full for the first seven months before the senior facility is drawn. The 40% investment tax credit ($61.8 million gross) is monetised through a Section 6418 transfer at $0.92 per dollar of credit; the bridge is repaid from the $54.9 million of net proceeds 9 months after commercial operation, with the $8.4 million Nephila ECOD instalment paid from the bridge.
The three independent market cases show the following. In the P50 base case the project earns $503.4 million of revenue over 20 years, a 19.1% levered after-tax project IRR, a 23.5% investor IRR and a 2.08x multiple, with after-tax payback in year 6. In the P90 downside case revenue falls to $344.9 million; senior debt is unchanged because it is sized on the contracted floor, and the investor IRR is 7.7% with a 1.32x multiple and payback in year 9. In the P20 upside case revenue reaches $801.7 million and the levered after-tax project IRR is 38.3%.
Distributions follow a 10% cumulative compounded preference, then a full return of the investor’s $85.2 million, then 70% to the investor and 30% to Bear Creek Energy Partners until the investor has received 2.0x its capital ($170.4 million), after which residual cash is split 49% to the investor and 51% to Bear Creek. The senior debt is supported by a 7-year contracted Nephila revenue floor of $56,170 per MW-year, and all 17 internal model checks and the five investor checks tie to zero.
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