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CMS advises battery storage company Zenobē on increased funding from Santander UK

12 July 2021

International law firm CMS has advised Zenobē, one of the UK’s leading owners and operators of battery storage, in relation to the commercial contracts for its flagship 100MW/107MWh battery at Capenhurst, near Chester, and in securing more funding from Santander UK to support its construction. 

The increased support – a non-recourse debt facility – from Santander UK builds on the   facility arranged between Zenobē and Santander UK in 2019 for Zenobē’s existing portfolio of operational assets and follows a successful equity raise by Zenobē from Infracapital, the infrastructure equity investment arm of M&G Plc, in 2020. The latest funding is a pre-construction project financing that will enable Zenobē to commence work at Capenhurst as well as grow its battery portfolio further. 

Established in 2017, Zenobē currently has 75 MW of operational grid-scale batteries, which provide a range of services including balancing, Dynamic Containment, and reactive power services in the UK to National Grid and the distribution network operators (DNOs). 

The Capenhurst project is expected to be completed by April 2022, when it will be capable of supplying enough electricity to meet the needs of more than 100,000 homes for an hour at peak demand. 

Philip Duffield, CMS partner, said: “Zenobē is going from strength to strength in its mission to deliver cleaner, more flexible power through the innovative use of battery storage. This transaction represents another big step for battery projects into the mainstream – with the right supply chain and optimisation arrangements, they are attractive to funders offering typical pre-construction project finance terms. We are incredibly pleased to have been able to support Zenobē on this strategic deal with Santander UK.”

Nicholas Beatty, Co-Founder and Director, Zenobē, said: “The expansion of our Santander UK facility to over £60m demonstrates our continuing leadership in the sector with a focus on innovation within the technology, operational and financing sides of the business. The additional debt raised and committed will be crucial in allowing us to roll out this project and our future pipeline of battery energy storage projects across the UK. CMS’s advice and comprehensive knowledge of the UK energy storage market, meant this market-leading and complex transaction was executed smoothly.”

The CMS team was led by Philip Duffield (Contracting) and included partners Louise Dalton (Revenue Streams) and Katie Duffield (Financing) with support from Iona Hunter and Hannah Merrick (both senior associates); Sabrina Polito and Oliver Brown (both associates); and Becca Murray and Christopher Thorp (both trainees).