Eolian and Natixis Corporate & Investment Banking Close $463 Million Financing for Largest Battery Energy Storage Site in Texas, Providing Needed Capacity at Critical Location for the Grid
Eolian, L.P. ("Eolian") announced the closing of a $463 million financing package, arranged by Natixis Corporate & Investment Banking ("Natixis CIB"), to support the continued construction of Padua 2 and Padua 3 — two large-scale battery energy storage systems (BESS) totaling 350 MW / 1.7 GWh in Bexar County, Texas. This financing enables the completion of the final phases of the Padua Complex, which will be the largest battery energy storage development in Texas and one of the largest ever constructed globally.
Upon completion in the Spring of 2026, all three phases of the Padua Complex will provide 400 MW / 1.8 GWh of instant-ramping capacity that is strategically sited at a substation adjacent to the retiring J.K. Spruce coal plant units and the aging V.H. Braunig natural gas power plant, and at a critical location that governs south-to-north transmission flows in Texas. The first phase, Padua 1, a 50 MW, approximately 2-hour phase, is now in commercial operation. Construction began earlier this summer on Padua 2 at 150 MW and Padua 3 at 200 MW, both with approximately 5-hour discharge durations. All three projects utilize battery energy storage equipment supplied by Tesla.
"Under Governor Abbott's leadership, Texas is showing the nation how to build energy infrastructure today that ensures sustained economic expansion for the future. By calling for and then passing into law new reliability products for the Texas grid, the Governor and the Legislature sent a clear market signal expressing the need and desire for the deployment of battery energy storage systems designed with four-hour or longer duration that directly led to our substantial investment in this project," said Aaron Zubaty CEO of Eolian. "Texas and the Padua Complex demonstrate how building battery energy storage at this speed and scale to meet urgent market needs and to better use the existing transmission network will act as a vital bridge between now and 2030, buying time to allow other technologies to scale and ramp up production and deployment while enabling continued load growth."
Eolian developed, constructed and will operate all three phases of the Padua complex with its in-house asset and optimization teams, building on the experience gained from being a first-mover in the deployment of grid-scale battery energy storage and more than four years of operating its existing 300 MW ERCOT BESS fleet. Padua's location at a confluence of major transmission lines in San Antonio was identified by the Eolian team in 2018 as a looming pinch point for power flows and highlighted in 2023 by ERCOT as a location needing significant additional generating resources, including the recent addition of mobile generating units. The Padua Complex, with more than $700 million of total private investment, dramatically increases the efficient use of the region's existing transmission lines until 2030 when approved regional 345 kV transmission upgrades are completed.
The Padua Complex is also built to highlight the capabilities of current BESS technology. Padua Phase 2 and Phase 3 will enable approximately 5-hour discharge operations and will be the two longest-duration BESS projects ever built in ERCOT. Specifically constructed with greater than 4-hour duration to meet clear technical requirements studied by ERCOT and approved in legislation, Padua answers the call led by Governor Abbott and the Texas Legislature for longer duration reliability products. ERCOT CEO Pablo Vegas has hailed the deployment of battery energy storage as making a significant difference in stabilizing the Texas grid, especially during hours of scarcity caused by high load.
"The Padua Complex is one of Tesla's largest global Megapack deployments to date. The 1.8 GWh project demonstrates the role batteries play in improving grid utilization and enabling more efficient operation of all power generation connected to the grid," said Mike Snyder, Vice President of Energy and Charging at Tesla. "Tesla has invested billions of dollars in the Texas economy and employs thousands of local employees who design and produce the technologies that enable Texas and the US to meet growing electricity demand while keeping rates affordable for consumers."
The $463 million financing package, arranged by Natixis CIB, includes construction, term loan, and letter of credit facilities. By fully funding Padua 2 and 3 in a single closing, the financing ensures the projects continue their construction without delay to reach the planned operations dates in the Winter and Spring of 2026.
"We're proud to support Eolian in advancing the Padua Complex, which represents the future of reliable, affordable energy," said Yan Meunier, Executive Director, Natixis CIB. "The Complex demonstrates how innovative financing and infrastructure investment can deliver meaningful stability to the grid at scale."
"The Padua Complex is a model for the nation on how battery energy storage systems make baseload better and positively transform the grid. By utilizing existing transmission lines more efficiently and adding highly flexible, fast-ramping capabilities to the market during peak hours, battery energy storage enhances grid reliability and extends the lifespan of existing baseload power plants; all of which is the type of investment intended by President Trump's OBBB," added Aaron Zubaty, CEO of Eolian.
Eolian | www.eolianenergy.com
