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Swell Energy raises $120M for virtual power plant deployment

This latest financing round brings Swell’s total equity capitalization to $152 million.

Swell Energy said it raised $120 million to further its virtual power plant (VPP) programs. The round was led by SoftBank Vision Fund 2 and Greenbacker Development Opportunities Fund I, LP, with participation from an Ares Infrastructure Opportunities fund and Ontario Power Generation Pension Fund.

The funding is expected to support Swell’s development of 600 MWh of VPPs through the deployment and aggregation of 26,000 energy storage systems. The VPPs are intended to provide grid service capabilities through projects in utility territories across Hawaii, California, and New York.

Swell creates VPPs by linking utilities, customers, and third-party service providers together, and by aggregating and co-optimizing distributed energy resources through the company’s GridAmp software. 

“By coordinating distributed energy resources across the grid to intelligently meet fluctuating demand, Swell’s AI- and machine learning-driven platform helps address a major challenge of the energy transition, while also lowering customers’ bills,” said Ben Parton, director at SoftBank Group. 

Ben Baker, managing director and principal at Greenbacker said that Swell’s business model aims to address two issues: transmission and load shifting. He said the company’s business verticals—grid services, finance, and development—”will swiftly expand the proliferation of renewable resiliency, providing value to both customers and utilities.”

In regions where local grids must accommodate more renewable energy and electric vehicle adoption, Swell said it VPP programs can provide increased grid flexibility while precluding investment in new fossil fuel generation.

Swell said that for these utilities, its service increases the stock of dispatchable behind-the-meter assets, aggregates these assets for grid services participation, and dispatches distributed energy resources. Swell analyzes and identifies each region’s needs and grid stresses and delivers grid services through flexible energy storage solutions, helping with load management, renewable energy balancing, and ancillary grid services.

This latest financing round brings Swell’s total equity capitalization to $152 million, including prior investments made by an Ares Infrastructure Opportunities fund, Aligned Climate Capital, Third Sphere, and others. Citi acted as sole placement agent on the transaction.

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