Lazard Australia has approached banks to lend into a stapled financing linked to the sale of Australian battery developer, Edify Energy, according to four sources familiar.

In March, Lazard started marketing Edify’s development business and an 11.2 GW portfolio of battery and solar projects.

The sources said the developer and its early-stage pipeline might only cost AUD 200m (USD 130m) to acquire but the teaser for the Project Charger sale notes that Edify’s owner will quickly have to come up with AUD 2.8bn in equity and debt to fund two shovel-ready projects, which are scheduled to reach notice to proceed by December 2025.

The Smoky Creek and Guthrie’s Gap 720 MWp solar/600 MW (2,400 MWh) battery hybrid project, is underpinned by 20-year CPI-linked toll agreements with Rio Tinto for 90% of the project’s capacity.

The Majors Creek and Ganymirra 360 MWp solar/300 MW (1,200 MWh) battery hybrid project is backed by 15-year Capacity Investment Scheme (‘CIS’) agreements with the federal government.

Banks willingness to lend into the staple and bidders’ willingness to engage in the process will hinge on the value they are prepared to attribute to those two projects, one of the sources said.

One of the projects is very close to construction, he noted, but the second one is a more uncertain prospect.

The teaser says 18% of Edify’s portfolio will be ready to build in 2025, a further 39% next year and 43% in 2027.

The portfolio is entirely comprised of solar and battery hybrid projects or stand-alone battery projects, which should prove attractive when standalone solar is coming under continuing pressure from Australia’s four million households with rooftop solar.

Fifty-nine per cent of the portfolio is in Queensland, 23% is in New South Wales, 12% is in Victoria and the remaining 6% is in South Australia.

The marketing document notes that the National Electricity Market will need another 21 GW of utility-scale storage and another 23 GW of utility-scale solar by the 2033 financial year if Australia is to hit its decarbonisation targets.

Edify has already sold the 185 MW/370 MWh Koorangie Battery to Sosteneo Capital Partners and the 150 MW/300 MWh Riverina and Darlington Point batteries to Federation Asset Management.

Officials and spokespeople at Edify and Lazard Australia did not respond to requests for comment.