Spearmint Energy Closes $450 Million Financing
- Energy Storage Grid Services & Demand Response News Utility-Scale BESS
Marin Holt
- 0
- 4 minutes read
- Total Financing: $450 million
- Project Size: 300 MW / 600 MWh
- Construction Facility: $225 million
- Preferred Equity: $96 million
- ITC Transfer Proceeds: $126 million
Spearmint Energy announced on May 22, 2026, that it closed approximately $450 million in project financings for Red Egret, a 300 megawatt / 600 megawatt-hour standalone battery energy storage system (BESS) under construction in Texas City, Texas. The financing package combines a $225 million construction facility, $96 million in preferred equity from Nuveen Energy Infrastructure Credit, and $126 million in proceeds from an Investment Tax Credit (ITC) transfer commitment. Red Egret is targeted to reach commercial operation on August 31, 2026, in the ERCOT power market.
The Financing
The construction facility is led by First Citizens Bank and Investec as coordinating lead arrangers and joint bookrunners. Nord/LB serves as joint lead arranger, and East West Bank acts as mandated lead arranger. Mortenson is the EPC firm for the project, and Sungrow USA is supplying the battery hardware, specifically 149 PowerTitan 2.0 units. Red Egret represents Spearmint Energy’s fourth project to employ the Sungrow PowerTitan platform. Nuveen Energy Infrastructure Credit, backed by TIAA, provided $96 million in preferred equity.
Why It Matters
This financing arrives as ERCOT installed approximately 13 gigawatts of grid-scale battery storage by year-end 2025, with an additional 6-8 gigawatts anticipated in 2026, according to ERCOT and Energy Information Administration data. Red Egret is part of the second wave of large standalone BESS projects financed under the post-Inflation Reduction Act ITC framework. This model, where the tax credit is monetized through a third-party transfer rather than absorbed by the developer, has become the dominant financing structure for U.S. utility-scale storage. The project is designed to participate in ERCOT energy and ancillary services markets, providing fast-response capacity to the Houston load zone.
Critical Perspective
Spearmint Energy did not disclose the total project capital cost. Information regarding a contracted ancillary services revenue floor, if any, was also absent. The pricing for the tax-equity partner on the ITC transfer was not revealed, nor was confirmation of whether the project has secured offtake agreements with specific load-serving entities. The $126 million in ITC transfer proceeds suggests a project tax basis in the range of $400-420 million, contingent on the discount applied to the transferred credit. ERCOT has not published a public commissioning timeline for Red Egret.
