Starwood pushes Stem energy storage project funding past $350 million

stem energy storage elp

California-based energy storage firm Stem Inc. announced Thursday that its project financing pool now exceeds $350 million.

Stem has a new $100 million commitment from affiliates of private investment group Starwood Energy Group Global LLC.

Stem created its energy storage project financing model in 2013 and now has more than 75 MWh of projects deployed or under contract across more than 480 locations across the United States.

Third-party financing enables companies such as Safeway, Wells Fargo and Adobe to subscribe to Stem’s storage-as-as-service solution with no upfront costs for equipment or installation, according to the company’s release.

“Distributed energy resources such as those provided by Stem will be part of the foundation of the future electric grid,” said Madison Grose, Vice Chairman, General Counsel and Senior Managing Director at Starwood Energy. “The Stem financing is an attractive investment that facilitates lower energy storage costs and wider adoption of clean energy solutions—a win/win for our investors, Stem’s customers and the environment,” added Patrick Verdonck, a principal with Starwood Energy.

According to recent reports, the U.S. market for behind-the-meter energy storage grew more than 400 percent in 2015. By 2021, this sector is expected to account for up to 49 percent of the total energy storage market.

“This financing vehicle gives our customers access to capital and allows them to achieve the benefits of intelligent energy storage without making a major investment,” said John Carrington, CEO of Stem. “Support from Starwood Energy helps solidify Stem’s position as a well-financed, industry leader in providing intelligent energy storage solutions.”

Stem offers storage-as-a-service to reduce electricity costs and aggregates energy stored in its fleet of systems to provide grid services as clean, reliable and instantaneous capacity to utilities and grid operators. Stem currently provides grid services to Southern California Edison, Hawaiian Electric, and the California Independent System Operator.

Stem’s primary project financing comes from Generate Capital. Generate’s work with Stem brings a version of the solar financing model to energy storage, supporting its mission to rebuild energy systems using high-impact, proven technology solutions.

Other project financing is also provided by Clean Feet Investors.

Headquartered in Millbrae, California, Stem is funded by a consortium of leading investors including Angeleno Group, Iberdrola (Inversiones Financieras Perseo) GE Ventures, Constellation Technology Ventures, Total Energy Ventures, Mitsui & Co. LTD., RWE Supply & Trading, and Mithril Capital Management.

Starwood Energy Group is a private investment firm based in Greenwich, CT that specializes in energy infrastructure investments. Through its general opportunity funds Starwood Energy Infrastructure Fund I and II, and other affiliated investment vehicles, Starwood Energy Group manages total equity commitments in excess of $2 billion and has executed transactions totaling more than $4 billion in enterprise value.

 

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