Black Rock Class B HoldCo LLC

Mesquite Sky and Black Rock Onshore Wind - Financing

Borrower (s)
Industry
Power/Onshore wind
Area of finance
Project & Infrastructure Finance
Country
United States

Deal Overview

Clearway Energy Group is raising two 11-month construction financings in support of two greenfield wind projects: the 345 Mesquite Sky project located in Texas and the 110 MW Black Rock project located in West Virginia. Upon completion, the projects will qualify for Production Tax Credits and bonus...

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Clearway Energy Group is raising two 11-month construction financings in support of two greenfield wind projects: the 345 Mesquite Sky project located in Texas and the 110 MW Black Rock project located in West Virginia. Upon completion, the projects will qualify for Production Tax Credits and bonus depreciation based on a 100% PTC safe harbor position. Both projects are financed under similar structure but through different borrowers: the short-term construction financing includes a tax equity bridge loan, a cash equity bridge loan and letters of credit to support the projects’ contractual obligations. At completion, construction loans will be repaid through tax equity take out from a subsidiary of the Berkshire Hathaway Energy Company and cash equity take from two sub-investment grade cash equity buyers (50% ownership each). The projects’ capacity will be contracted through long-term power purchase agreements and a hedge agreement with investment grade counterparties. 

The projects benefit from strong sponsorship with Clearway Energy Group, a leading energy infrastructure investor focused on modern, sustainable and long-term contracted assets across North America. Clearway Energy Group is 100% owned by Global Infrastructure Partners, the third largest infrastructure fund worldwide. Contingency costs are sized to cover any unexpected delays and to support a pre-determined construction acceleration plan. Experienced constructing companies will work with the world’s leader turbine supplier Siemens-Gamesa. Adequate LDs packages have been included in the different commercial agreements. 

This is a large construction loan with no back-leverage financing. Both the tax equity bridge loan and the cash equity bridge loan financing are expected to be fully repaid at completion through equity commitments secured before financial closing. Lenders accepted to take repayment risk with non-IG cash equity buyers. 

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Deal Volume
$ 645.52m
Financial Close
06 January 2021
Sources
Submitted by participant(s), Proximo article, Press release

All Dealmakers

Makela Hughes

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Madeleine Winges

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Tranches


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Projects

345 Mesquite Sky Onshore Wind Project

Greenfield
Onshore wind
United States
$ 427m

110 MW Black Rock Onshore Wind Project

Greenfield
Onshore wind
United States
$ 218.52m