Cumulus Growth, a wholly-owned subsidiary of Talen Energy Corporation, through its wholly-owned subsidiary Cumulus Digital LLC, has secured a 6-year, up to US$175 million strategic capital partnership with Orion Energy Partners.
The investment from Orion will be used to fund common infrastructure for the Cumulus 400-acre hyperscale data centre campus located adjacent to Talen’s 2.5 Gigawatt Susquehanna carbon-free nuclear plant, as well as to fund Talen’s previously-announced bitcoin mining joint venture with TeraWulf, known as Nautilus Cryptomine.
Up to $125 million of the Orion capital will be available following closing and an additional $50 million will be available once agreed milestones have been satisfied. In addition, Orion will receive a non-voting equity interest in Cumulus Digital Holdings LLC, the parent of Cumulus Digital.
The investment will be secured by a pledge of substantially all of the assets of Digital Holdings and its subsidiaries.
Nazar Massouh, CEO and Co-Managing Partner of Orion, said: “Our firm was built on the core principle of funding energy transition and environmental innovation across infrastructure assets by partnering with exceptional management teams, entrepreneurs, and operators.”
Concurrent with the investment, subsidiaries of Talen Energy Supply LLC (TES) sold the equity interests of certain clean energy project development entities (holding primarily: data centre, renewables, and battery storage assets) and certain undeveloped land to Cumulus Growth, in return for voting convertible preferred equity interests in subsidiaries of Cumulus Growth.
Post-closing, Talen will own common equity in Cumulus Growth and its subsidiaries and TES, and certain of its subsidiaries, will own voting convertible preferred equity in certain Cumulus Growth subsidiaries, which provide TES with equity participation in Talen’s clean energy and digital infrastructure transformation.
Alex Hernandez, CEO of Cumulus Growth and President of Talen, said: “We have broken ground on the Cumulus data centre campus, which will provide carbon-free energy generated by Susquehanna’s dual units to power the campus, including up to 475 Megawatts for hyperscale data centre clients and 300 Megawatts for coin mining and other blockchain applications.
“The Cumulus data centre investment will create family-sustaining jobs, technology training, and other economic benefits including tax revenue and increased consumption of local goods and services to both Pennsylvania and the surrounding community.”
Also commenting, Gary Wojtaszek, former CEO of CyrusOne and Advisor to Talen and Cumulus Growth said that the Cumulus Growth platform is well-positioned to serve technology customers by providing carbon-free, low-cost, ultra-reliable electricity integrated with digital asset infrastructure at scale.
“These attributes enable the Cumulus Growth platform to offer the lowest total cost of ownership together with ESG benefits to hyperscale, cloud, AI, coin, and blockchain clients globally,” he added.
“Additionally, Cumulus Growth is expected to offer customers the ability to supplement its giga-scale carbon-free offering with 400 Megawatts of new solar generation capacity under development in Pennsylvania.”
Following the investment and initial capitalization of Cumulus Digital, Talen and Cumulus Growth intend to raise incremental growth equity in the near-term for further data centre, coin, storage and renewables growth projects.