IN Brief:
- The financing covers 446MW of photovoltaic capacity and around 1.8GWh of storage.
- Algarrobal includes 242MW of solar and 1,480MWh of battery capacity.
- Six operational Palmas solar projects will receive a total of 289MWh in battery retrofits.
Grenergy has secured $457m in non-recourse senior financing for solar and battery developments in Chile, covering 446MW of photovoltaic generating capacity and approximately 1.8GWh of energy storage.
The financing covers Algarrobal, the fifth phase of the developer’s Oasis de Atacama platform, alongside the Palmas group of distributed solar projects. BNP Paribas coordinated and underwrote the transaction, with other participating lenders including BBVA, J.P. Morgan Chase Bank, MUFG Bank, Santander and The Bank of Nova Scotia.
Algarrobal combines 242MW of solar capacity with 1,480MWh of battery storage. It represents a hybrid generating installation in which the storage equipment will enable some of the electricity generated during daylight to be delivered at different periods.
The Palmas group consists of 21 distributed generation solar projects with 204MW of capacity across northern and central Chile. The solar projects are already operational, while six will receive additional battery installations totalling 289MWh.
That distinction prevents the retrofit programme from being confused with the commissioning of 21 new solar parks. The financing supports existing generating assets and new storage work as well as the Algarrobal development.
Grenergy plans five-hour battery systems for the six Palmas retrofits. Discharge duration depends on the relationship between energy capacity and the corresponding power rating, alongside available charge, losses and the operating reserve set by the control system.
Adding batteries to an existing photovoltaic site requires careful assessment of the network connection. The original site may have been designed around solar inverter output alone, with limited spare export capacity for electricity released by storage.
Electrical design must therefore account for charging and discharge paths, transformer loading, protection settings and the control of combined output at the connection point. The choice between direct-current and alternating-current integration affects which equipment must be added.
A hybrid plant can charge batteries when sunlight is strong and deliver stored electricity later, but the storage system does not itself generate additional primary energy. The operational benefit arises from changing the time at which some available generation is supplied.
Battery operation also involves conversion losses and equipment degradation over time. Dispatch schedules must balance potential electricity revenue against the constraints imposed by available energy, system availability and contractual commitments.
Algarrobal is supported by a 12-year hybrid power purchase agreement due to begin on 1 January 2028. The offtake contract provides a commercial framework for part of the development’s electricity supply and storage operation.
Such contracts can support project financing by defining a future revenue pathway, although the precise allocation of volume, delivery risk and operating obligations depends on terms agreed between the developer and customer.
The $457m borrowing is non-recourse senior debt associated with the project portfolio. This form of finance is assessed principally against project assets, contracts and anticipated cash flows rather than being equivalent to an unrestricted corporate loan.
The transaction is the largest project financing Grenergy has completed to date. Grenergy places its accumulated non-recourse financing in Chile at more than $2.4bn across Oasis de Atacama, Central Oasis and Palmas.
The wider Oasis de Atacama and Central Oasis platforms include planned developments amounting to 3.9GW of photovoltaic capacity and 19.2GWh of energy storage. Those figures describe the combined development programme and must not be presented as capacity already operating.
Grenergy is pursuing related solar and storage designs in the Iberian Peninsula, where it has also secured financing and offtake arrangements for hybrid projects. Local market design and grid connection conditions will influence how those projects operate.
Grenergy has not broken out the borrowing allocated to every component of the portfolio. The financing headline therefore should not be translated into a construction cost per installed megawatt or megawatt-hour. Such comparisons would also be affected by whether the financed equipment is new generation, additional batteries at existing sites or shared electrical infrastructure.
The six Palmas battery projects will need to coordinate with solar plants already delivering electricity. Installing storage without interrupting generation requires careful scheduling of construction and electrical works, while commissioning must establish that the modified plant remains compliant with its grid connection and metering arrangements.
Grenergy’s borrowing covers two different construction tasks: a new hybrid solar and battery phase at Algarrobal, and the addition of storage to selected already operating solar sites in Palmas. Six Palmas projects will gain batteries, while the wider cluster contains 21 solar installations. Their electrical commissioning and the subsequent start of Algarrobal’s contracted delivery are distinct future milestones.
