Move over, NIMBYs. There’s an increasingly prevalent, even more fun-to-say (dare I call it a-PEAL-ling?) acronym describing souring sentiments over data center development: BANANAism.
Not In My Backyard, a common refrain from those who recognize the need for infrastructure elsewhere, but not located too close to them, has given way to Build Absolutely Nothing Anywhere Near Anyone.
BANANAs have been around for a while; there’s an argument that such attitudes have scuttled everything from battery storage sites to more visible projects like Lava Ridge Wind, the doomed Magic Valley Energy enterprise in southcentral Idaho, knocked for intruding upon the Minidoka National Historic Site, where Japanese Americans were incarcerated during WWII, despite its closest turbine planned to be nine miles away. But the new flavor has a particular intolerance for artificial intelligence (AI) infrastructure.
The small Milwaukee, Wisconsin, suburb of Port Washington will soon be home to a $15 billion, 1.3-gigawatt (GW) StarGate AI megaproject shepherded by tech giants OpenAI and Oracle and blessed by the Trump administration. They’ve had so much fun going through the process that voters just passed a first-of-its-kind referendum requiring city leaders to obtain voter approval before awarding developers lucrative tax incentives for future data center projects. As Politico points out, other communities around the country are set to vote on similar ballot measures later this year, and in Ohio, Buckeye BANANAs are tailoring an initiative that would appear on the statewide ballot to ban new construction of certain large data centers.
This is not an original thought, but it’s becoming increasingly clear that the real world doesn’t scale nearly as quickly as technology does. Despite the seemingly bottomless pockets of hyperscalers, mind-boggling advancements in AI, and federal support in beating global competition, it’s going to take time to build. The right kind of land in the right sort of place must be identified and secured; communities have to be bought out/won over; equipment has to be procured- transformers and turbines don’t fall into place on a whim; then it’s on to grid connections and/or utility infrastructure upgrades; on and on, you get it. Proponents of AI will tell you we don’t have a second to spare to ‘win the race,’ but perhaps a slower, more measured approach is the only way we get to the finish line- wherever that is. Otherwise, we’re going to be growing more and more bananas.
A quick bookkeeping note for those of you who read this column frequently: our finance and project development roundup is about to take on a new form and be posted on a new day. My colleague Sean and I will be turning this recurring article into a weekly newsletter, which subscribers should receive for the first time on Monday, April 20, 2026. The full, rambling original article will still exist on Factor This, going live early that morning. Let us know what you think, and feel free to send any potential inclusions my way in the meantime. Be good, and whenever your weekend begins, I hope it’s as loud and proud as the sound of thousands of neighborhood dads engaging the PTO switches on their mowers for the first time this season. Save a ray of sunshine and a sudsy beverage for me.
Arclight Closes on $3.9 Billion Fund
Infrastructure investor ArcLight Capital Partners has closed on its ArcLight Infrastructure Partners Fund VIII with $3.9 billion in total commitments. The fund was oversubscribed, exceeding the target capital commitment of $3.0 billion by 30%. Kirkland & Ellis LLP served as legal counsel.
Dan Revers, founder and managing partner of ArcLight, said he’s grateful for the support of the investor’s partners.
“As ArcLight celebrates its 25th year of investing, the successful close of Fund VIII underscores our differentiated approach, expanded capabilities, and value proposition to its partners,” he noted.
“The ability to build, connect, and operate critical infrastructure is becoming increasingly important to creating long-term alpha. Over the last five years, ArcLight has significantly reinvested in and expanded the firm’s infrastructure, team, and resources,” added Angelo Acconcia, president and partner of ArcLight.
ArcLight has raised more than $6B across all vehicles over the last 2 months. Since its founding in 2001, ArcLight has owned, controlled, and operated ~70 GW of power generation assets and 48,000 miles of electric and gas transmission infrastructure, collectively representing over $80 billion in enterprise value.
As we mentioned in a roundup last month, ArcLight Capital Partners recently signed an agreement to acquire a 50% stake in Invenergy AMPCI Thermal Power (IATP), a jointly owned power portfolio in which Invenergy will retain its existing ownership interest and operational role.
Conduit Finds Facility for ERCOT Portfolio
This week, independent power producer (IPP) Conduit Power closed on a $200 million equipment financing facility with Eldridge Capital Management to support the buildout of Conduit’s recently announced 200-megawatt (MW) distributed generation portfolio in Texas’s ERCOT, featuring strategically located, fast-start, dispatchable power assets designed to serve grid-constrained regions like Load Zone West.
The master equipment lease facility provides financing for generation equipment and is designed to align with Conduit’s modular deployment model, funding multiple projects as sites are commissioned.
“This facility provides scalable capital aligned with our deployment model and validates the strength of our distributed generation strategy,” assessed Matt Herpich, CEO of Conduit Power.
Conduit delivers its hybrid gas-and-battery power solutions to data centers in 50 MW blocks, powering campuses in two years or less. By interconnecting at the distribution level and deploying modular facilities, Conduit can deliver capacity on accelerated timelines without requiring large-scale transmission upgrades, a pervasive bottleneck even in Texas.
“Energy, industrial, data center, and residential load growth in West Texas will challenge grid capacity for years to come, and the interconnection queue is significant and growing,” chimed Kyle Parks, managing director and co-head of asset-based credit at Eldridge Capital Management.
Energy Vault Goes Big in Japan
Grid-scale storage company Energy Vault has announced its formal entry into the Japanese market through a binding agreement to acquire a pipeline of battery energy storage system (BESS) projects from a yet-to-be-publicly-named “leading domestic energy storage developer.”
The transaction includes integrating an established team of local energy experts and acquiring an 850 MW BESS development portfolio, consisting of 350 MW of advanced-stage projects targeted to commence construction in H2 2027 and reach commercial operations beginning in H2 2028. The portfolio also includes 500 MW of early-stage BESS projects, providing a robust, multi-year growth pipeline that Energy Vault believes sets it up for long-term leadership in the Japanese energy storage market.
“Entering the Japanese market is a key component of our high-growth markets expansion strategy and represents one of the most compelling energy storage growth opportunities globally,” said Robert Piconi, chairman and CEO of Energy Vault. “By combining our proprietary VaultOS energy management software and global supply chain with a proven local team, we are uniquely positioned to accelerate the deployment of the flexible capacity that the Japanese grid urgently requires. Furthermore, we expect to leverage our new solutions in the high-growth AI Compute segments to further compound growth opportunities within the market to enhance delivery of predictable, high-margin, long-term revenue streams ahead of our previously stated growth targets.”
Energy Vault assesses that Japan is a uniquely attractive market driven by increasing grid constraints, rapid renewable penetration to meet 2050 carbon goals, and a projected 50%+ compound annual growth rate (CAGR) in BESS capacity. The Japanese energy market is undergoing a fundamental structural shift toward “revenue stacking,” where BESS assets are increasingly required to generate diversified yields from wholesale arbitrage, capacity markets, and critical balancing services to ensure system stability. To meet these specific market dynamics, which demand exceptionally high energy density and stringent safety profiles, Energy Vault intends to leverage its technology-agnostic approach, including deploying its B-VAULT AC Technology Platform and integrating alternative chemistries, building upon the company’s recently announced partnership with Peak Energy to commercialize next-generation sodium-ion battery technology.
“Despite being a highly developed economy, Japan’s energy storage market remains significantly underpenetrated and is now entering a period of accelerated growth driven by renewable expansion and structural grid constraints. Importantly, storage demand in Japan is not tied to load growth, but to the increasing need for flexibility, resilience, and system stability—creating a powerful, long-duration growth tailwind for our broad portfolio of solutions,” added Piconi.
Heelstone Starts Construction on Two Solar Projects
Utility-scale renewables platform Heelstone Renewable Energy, a Qualitas Energy company, has commenced construction on two U.S. solar projects: 104 MW Alligator Creek Solar in Wheeler County, Georgia, and 102 MW Murch Solar in Van Buren County, Michigan.
Engineering, procurement, and construction (EPC) agreements have been executed with Pure Power Contractors for Alligator Creek and with Greensol Renewables for Murch, marking the transition of the portfolio from late-stage development into the construction phase. Financial close for Alligator Creek was reached in December 2025, while Murch closed in March 2026. Commercial operation of the two facilities is expected by the end of 2026.
Both projects are backed by long-term corporate power purchase agreements (CPPAs) with a “leading U.S. hyperscale data center developer.”
Paragon Energy Capital advised Heelstone on the financing of Alligator Creek, with Stonehenge Capital providing syndication and asset management services to the Production Tax Credit buyer and Zions Bancorporation, N.A., acting as the sole coordinating lead arranger under a construction-to-term loan facility. For Murch, CG/CRC-IB advised on the financing process. Stonehenge Capital provided the tax equity investment, while ING Capital LLC and Norddeutsche Landesbank Girozentrale acted as coordinating lead arrangers and lenders, providing both a tax equity bridge facility and a construction-to-term loan.
Founded in 2012 and headquartered in Durham, North Carolina, Heelstone has developed and/or brought more than 80 solar PV projects totaling over 1.2 GW into commercial operation. The company was acquired by global investment and management platform Qualitas Energy in 2024. Heelstone recently closed on a $200 million senior secured corporate credit facility, further advancing the company’s strategic growth objectives.
Origis Energy Closes on Tax Equity Financing
Clean energy platform Origis Energy has closed on $118M in tax equity financing from RBC Community Investments for the Chalan Solar + Storage project in Kern County, California.
Origis Energy is constructing and will own and operate the 65 MWac solar and 25 MW/100 MWh battery energy storage facility, which is expected to achieve commercial operation in Q4 2026. The project’s output is contracted under a 20-year power purchase agreement with Pioneer Community Energy, a not-for-profit community choice electricity provider headquartered in Rocklin, California, serving customers across Placer and El Dorado counties.
“We are delighted to partner with RBC to bring another high-quality solar and storage project to the grid and deliver reliable, cost-effective clean energy to Pioneer’s customers and communities,” said Alice Heathcote, chief financial officer of Origis Energy.
