Canadian Solar (NASDAQ: CSIQ) announced Sept. 8 that its wholly owned subsidiary, Recurrent Energy, has closed on a debt facility with Santander Bank N.A. and a tax equity investment commitment with U.S. Bancorp Community Development Corp. (USBCDC), securing financing for the 100-MW (ac) Mustang solar project.
Recurrent Energy will be the managing member and plans to own and operate the project, currently under construction in California. Under the agreements, Santander Bank will provide $165 million in construction lending, a tax equity bridge loan, and a term loan option for the Mustang solar project. USBCDC is making a tax equity investment in the project, under a separate agreement.
“This agreement with leading investors such as Santander and USBCDC demonstrates our ability to develop consistently bankable solar projects,” said Dr. Shawn Qu, Chairman and Chief Executive Officer of Canadian Solar. “Securing financing for the Mustang project is an important milestone as we work to execute on our pipeline of late stage projects.”
“By supporting renewable energy projects like the Mustang facility, we can help sustain the environment and stimulate the economy,” said Jorge Camina, Head of Project Finance at Santander Bank, N.A. “Financing Canadian Solar and Recurrent Energy in this milestone project demonstrates our commitment to supporting leading sponsors of renewable energy projects.”
“USBCDC is excited to partner with Canadian Solar and Recurrent on this investment, which will lead to economic development and job creation in Kings County, while providing additional renewable energy resources to California electric customers,” said Adam Altenhofen, vice president of U.S. Bancorp Community Development, which invested $101 million in renewable energy tax credit equity in the project.
The Mustang project, covering an area of about 1,000 acres in Kings County, is expected to reach commercial operation in the fourth quarter of 2016. The project began construction in summer 2015 with Blattner Energy serving as the provider of Engineering, Procurement, and Construction services (EPC). The electricity and associated renewable energy credits (RECs) generated by the facility will be sold under long-term power purchase agreements.
Santander Bank is one of the largest retail banks in the United States by deposits. Its main corporate offices are in Boston and it operates principally in Connecticut, Delaware, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania and Rhode Island. Santander in the U.S. is a wholly-owned, financially autonomous subsidiary of Banco Santander (NYSE: SAN), a global commercial and retail bank.
With nearly $16.5 billion in managed assets as of June 30, 2015, U.S. Bancorp Community Development, a subsidiary of U.S. Bank, provides innovative financing solutions for community development projects across the country using state and federally sponsored tax credit programs.
Recurrent Energy is redefining what it means to be a mainstream clean energy company, with utility-scale solar plants that provide competitive clean electricity. The company has more than 4 GW of solar projects in development in North America.
Founded in 2001 in Canada, Canadian Solar is a leading manufacturer of solar photovoltaic modules and a provider of solar energy solutions. It has a geographically diversified pipeline of utility-scale power projects. In the past 14 years, Canadian Solar has successfully deployed over 11 GW of premium quality modules in over 70 countries around the world.