DLA Piper advises Hydrostor on DevEx loan facility to support the development of 200 MW Silver City Energy Storage Centre

Global law firm DLA Piper, acting as Australian counsel in conjunction with lead counsel Davies Ward Phillips & Vineberg LLP, has advised Hydrostor, a leading global developer and operator of long-duration energy storage systems, on securing a USD55 million Development Expenditure (DevEx) credit facility from Export Development Canada (EDC). The financing will support the advancement of Hydrostor’s flagship 200 MW Silver City Energy Storage Centre project in Broken Hill, New South Wales, Australia and the development of Hydrostor’s broader global project portfolio.

The Silver City Energy Storage Centre project represents one of Australia’s most ambitious but well advanced long-duration energy storage initiatives, leveraging Hydrostor’s Advanced Compressed Air Energy Storage (A-CAES) technology. Upon completion, the project will provide eight hours of energy storage, helping to replace end-of-life fossil generation with zero-emission storage and accelerate the integration of intermittent renewables into the Australian market.

The DLA Piper team advising Hydrostor was led by Sydney-based Finance partner Alex Regan and supported by special counsel Caroline Rowe and solicitor Sophia Davies. Corporate and project support was delivered by partner Chris Mitchell and senior associate Giacomo Bell.

Commenting on the transaction, Alex Regan said: "This innovative transaction allows Hydrostor to bring this transformative energy project to life. The Silver City Energy Storage Centre will play a critical role in Australia’s energy transition, and this financing marks a significant milestone in its ongoing development".

DevEx loan facilities are a new and emerging financing structure in the Australian market designed to fund early-stage project development costs. DLA Piper has now advised on two of the first DevEx lending transactions involving Australian renewable energy projects, most recently supporting Pacific Green, a global leader in battery energy storage solutions, on securing a DevEx loan facility of up to AUD77 million with Longreach Credit Investors and the Australian Philanthropic Services Foundation.

Chris Mitchell, Head of DLA Piper’s Renewable Energy Team commented: “The DevEx funding facility and portfolio development support from EDC enhances Hydrostor’s capacity to accelerate the development and deployment of long-duration energy storage projects. These projects will play a crucial role in advancing an efficient and sustainable energy transition across Australia, the United States, and other key international markets”.

“The strong local and international interest in DevEx financing highlights growing investor confidence in capital deployment to advance early-stage clean energy infrastructure vital to the global energy transition”, Chris added.

Global Co-Chair of DLA Piper’s Energy and Natural Resources sector Alex Jones added: “These transactions highlight the scale and innovation driving Australia’s energy transition. It reflects the strong interest from global investors and financiers in supporting renewable infrastructure and underscores our commitment to helping clients navigate complex transactions and deliver impactful, market-leading outcomes”.