In 2020, Intersect Power, a clean infrastructure developer, was launching a process to raise capital to enable a shift in corporate strategy and long-term funding for the company's project pipeline. But, before this transaction could close, Intersect needed to continue funding sizeable project deposits and capital expenditures for a portfolio of late-stage utility-scale solar and energy storage projects.
Leyline Renewable Capital provided the solution. Leyline stepped in quickly to provide Intersect with a $50 million bridge note, supporting Intersect through this transition. Leyline provided the financing through its Leyline Bridge Capital solution.
Leyline Bridge Capital is a financing product designed for established renewable energy developers that have late-stage projects that have yet to begin construction. The loan gives developers the "bridge" needed to cover short-term expenses or take advantage of a short window of opportunity. The developers that receive a bridge loan meet collateral requirements for the loan through a project or corporate guarantee. Because the financing arrangement is short, the term is typically a year or less.
Leyline's capital and business model is uniquely positioned to support renewable energy developers that need bridge financing.
"Leyline acted swiftly and structured a loan that aligned with Intersect's strategic needs," said Nick Pape, Intersect Power's CFO. "Leyline was an excellent fit for us, because the company clearly understands development risks. Leyline was able to value the assets supporting its loan as well as our team's capabilities, and it structured the loan in a way where we were able to proceed with our business smoothly."
In 2021, Intersect closed eight separate transactions, representing an aggregate of $2.6 billion of financing commitments. These transactions include the six-project portfolio in Texas and California that the Leyline bridge loan supported in 2020.
These were landmark transactions in the clean energy sector, due to the innovative approach to offtake contract structuring on the projects and the unique portfolio financing structure, designed to account for the higher proportion of uncontracted revenue in the project portfolio. Intersect's focus on the active management of shorter-tenor offtake contracts and portfolio-level financing is expected to deliver high risk-adjusted returns for investors.
The bridge note from Leyline supported Intersect Power to make key investments, including recapitalization of the company, and helped Intersect to move toward long-term ownership of its projects.
About Intersect Power
Intersect Power is a clean energy company bringing innovative and scalable low-carbon solutions to its customers in retail and wholesale energy markets. The company develops some of the world's largest clean energy resources, providing low-carbon electricity, fuels, and related products to customers across North America. Intersect Power has an 8.5+ GWp and 8+ GWh mid- to late-stage pipeline that includes a base portfolio of 2.2 GWp of solar PV and 1.4 GWh of co-located storage that will be in operation by 2023. The Intersect team is also planning 600+ MW of green hydrogen production. To learn more about Intersect Power and view its job openings, please visit www.intersectpower.com/who-we-are/.
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