Vancity Community Investment Bank (VCIB), Canada’s first values-driven bank, has announced financing the first tranche of Ontario-based commercial energy storage projects in a portfolio owned and operated by Stem, Inc. (“Stem”) (NYSE: STEM), a global leader in artificial intelligence (AI)-driven clean energy storage services.
Behind the meter energy storage, an on-site solution to store electricity capacity for use when needed, allows customers to manage costs and reduce emissions. These projects will support several Ontario-based manufacturing and industrial facilities in cutting electricity costs by lowering energy demand at peak times. Stem will also provide additional services directly to the electric grid operator, leading to overall more efficient utilization of energy storage systems.
“We’re pleased to complete this first financing with VCIB and, together, demonstrate the bankability of on-site energy storage,” said Bill Bush, Chief Financial Officer at Stem. “Energy storage is a critical component of reaching a net-zero grid, and the availability of financing by mainstream lenders will go a long way toward accelerating the deployment of these projects in Canada.”
This example of commercial debt financing for behind the meter energy storage projects represents the next step toward market maturity for Canada’s emerging energy storage industry. With VCIB providing a made-in-Canada solution, companies providing energy storage systems will no longer need to solely rely on foreign capital sources.
While these projects will also be responsible for reducing carbon emissions, their primary value is enabling the transition to a decentralized, clean electricity grid. A widespread network of energy storage systems can increase resilience against power outages and provide the flexibility required to increase renewable energy and reduce reliance on natural gas peaker plants.
“Energy storage is a critical component of a modern, low-emissions electricity grid, and while renewable energy has made big strides over the last decade, energy storage has been a missing piece, especially in the Canadian market,” said Jon Frank, Head of Clean Energy at VCIB. “We’re excited to partner with Stem on a breakthrough transaction that will help grow a sector essential to Canada’s net-zero economy ambitions.”