Powering the Future: Pathward's Transformative Battery Storage Investments in Texas

In a strategic move to bolster the renewable energy landscape in Texas, Pathward®, N.A. has secured $146.5 million in construction loans to support the sponsor's acquisition and construction of six battery energy storage system (BESS) projects in Cameron County. This landmark financing, with the participation of the North American Development Bank (NADBank), marks a significant step forward in the state's transition towards a more resilient and sustainable power grid.

Unlocking the Potential of Battery Storage for a Greener, More Reliable Texas Grid

Expanding Energy Storage Capacity for the Texas Grid

The six BESS projects, set to become fully operational by the Summer of 2025, will have a combined capacity of 154 megawatt-hours. This substantial increase in energy storage capacity will play a crucial role in enhancing the reliability and flexibility of the Texas grid, enabling it to better integrate and support the growing renewable energy infrastructure in the state.The standalone battery storage projects are projected to cycle an impressive 54,925 MWh of electricity annually, which is equivalent to the electricity consumption of approximately 4,000 U.S. households. This significant contribution to the grid's energy supply will help address the challenges of intermittent renewable generation and ensure a more consistent and reliable power supply for Texas residents and businesses.

Providing Grid Stabilization and Resilience

The battery storage projects will participate in the Electric Reliability Council of Texas (ERCOT) market, selling electricity and grid stabilizing services. These batteries serve as a flexible resource, capable of switching from charging to discharging electricity within milliseconds to supply energy when it is needed most and to help stabilize the grid.ERCOT's financial incentives for battery projects that provide reserve energy to the grid further underscores the critical role these storage solutions play in enhancing the resilience and reliability of the Texas power system. By complementing the growth of renewable energy and conventional generation, the battery storage projects will help mitigate the impact of power disruptions and reduce energy losses resulting from mismatches in supply and demand.

Pathward's Commitment to Renewable Energy Financing

This latest construction facility with the sponsor marks Pathward's second closed project in Texas, following the $72.35 million in construction loans provided for three BESS projects in Bexar County in late 2023. Pathward's dedication to financing the renewable energy economy and its passion for supporting the battery storage segment of the market have been instrumental in driving this transformative initiative."Financing the renewable energy economy is an important component of our sustainability strategy, and battery storage is an exciting segment of the market that we're passionate to support," said Christopher Soupal, Divisional President of Pathward's Commercial Finance strategic business line. "We appreciate the ongoing trust placed with our team and the opportunity to continue partnering on future projects in Texas. We are incredibly honored by the strong relationship between the banks, our strategic partner Palmetto Energy Capital, and battery storage developers."

NADBank's Commitment to a Greener, More Sustainable Grid

The North American Development Bank (NADBank) has played a crucial role in this project, providing $73.25 million in funding for the BESS projects. As a pioneer institution in the field of environmental infrastructure financing, NADBank's involvement underscores its commitment to developing environmentally and financially sustainable projects that support the transition to a greener, more reliable power grid."NADBank is very pleased to be backing the transition to a greener economy by supporting a more reliable Texas power grid that will minimize power disruptions and reduce energy losses resulting from mismatches in supply and demand," stated NADBank Managing Director John Beckham. "We congratulate the team on closing the financing for this important project that will contribute to a greener, more sustainable grid."The partnership between Pathward, NADBank, and the sponsor, facilitated by Palmetto Energy Capital, demonstrates the collaborative efforts required to drive the renewable energy revolution and ensure a more resilient and sustainable future for Texas and the broader region.