Zenobe secures £850m investment for its electric dreams
Clean energy specialist Zenobe has secured more than £850m of investment from private equity partners, as it looks to expand its electric fleet and storage businesses across the UK and global markets.
The company has confirmed today £600m of investment from KKR alongside a further £270m from existing shareholder Infracapital — which includes £35m from infrastructure group Pantheon through a shared investment vehicle.
Upon completion KKR and Infracapital will become joint majority shareholders in Zenobe, while Japan’s Jera and TEPCO Power Grid will remain as minority strategic shareholders.
The agreement is subject to customary closing conditions and regulatory approvals.
The funds will be used primarily to boost Zenobe’s electric vehicle network, which includes buses, cabling and repurposed batteries — across markets including the UK, North America, Europe, Australia and New Zealand.
It will also enable the business to speed up plans to develop its battery storage facilities in Scotland, including two new additional battery storage sites in Kilmarnock, and expand an establish site in Moray.
This will enable Zenobe to meet its target of 1.2GW of storage in the UK by 2026, in an effort to support the integration of wind power resources into the grid.
Funds will be directed towards plans to develop an additional 2.5GW of battery energy storage assets in North America and Australia by 2030.
Storage is a fundamental challenge for the renewables sector — with wind power providing clean and cheap energy, but with pronounced lulls during periods of low wind.
As it stands, batteries can be supplemented with multiple hours of storage but not the weeks and months provided by LNG facilities for fossil fuels.
Meanwhile, the cost of turning off wind turbines during periods of peak generation to prevent the grid being oversupplied remain high — totalling £63.7m last month, according to Kona Energy, a clean energy developer.
The International Energy Agency has warned that projected growth in grid-scale storage capacity is not on track to meet net zero targets across developed economies, and requires greater effort.
However, one example of innovation in the sector is Zenobe’s battery storage plans — which include large-scale 200-300 MW battery facilities that could store power for multiple hours every day, and would be available for the grid during surges.
This would mean National Grid would no longer have to turn to fossil fuels to deal with shortcomings in renewable power.
Nicholas Beatty, a co-founder and director of Zenobe, said: “Batteries are critical to optimising the use of renewable electricity and making cheaper, greener and more secure power accessible. As fleet operators transition to electric, batteries offer a proven and available technology which, combined with software and data insights, can optimise the operators’ fleet while achieving zero emissions.”
The equity investment is the latest in a series of financial agreements by Zenobe, which has secured about £1.8bn of equity and debt finance since being established in 2017.