Announcement of Sparks - Storage Battery Fund Establishment

Sparks Group Co., Ltd. (hereinafter, Sparks) has established the "Sparks - Storage Battery Fund" (hereinafter, the Fund), which primarily invests in merchant (market-operated) storage battery projects aiming to generate revenue through market operations, as a new initiative towards achieving carbon neutrality in Japan.

Storage batteries are large-scale storage facilities that connect directly to the power grid, charging when there is surplus electricity and discharging when there is a shortage. They function as a regulating force to suppress fluctuations in power source output. They are attracting attention as important next-generation infrastructure that balances decarbonization with stable supply by solving challenges such as "power grid instability" and "output control" accompanying the expansion of renewable energy introduction.

In recent years, the introduction of storage batteries has been rapidly expanding globally, and demand is also increasing in Japan. In February 2024, we established the "Sparks Green Storage Battery Fund" targeting storage batteries utilizing the long-term decarbonized power source auction. However, in response to recent power market volatility and the increasing importance of agile regulating capacity, we have newly launched this Fund.

The storage battery projects targeted by this Fund aim to maximize revenue obtained through transactions in the balancing market, wholesale electricity market, and capacity market by flexibly charging and discharging electricity according to supply and demand conditions, without relying on specific long-term contracts. Sparks will serve as the fund operator (GP), and its subsidiary Sparks Asset Management Co., Ltd. will act as the operating agent. We have received investments from institutional investors and business companies (LPs) and have concluded the partnership agreement today with a total amount of 6.1 billion yen. We plan to solicit investments aiming for a fund size of approximately 10 billion yen until the end of July 2026.

Furthermore, our subsidiary Sparks Green Energy & Technology Co., Ltd. (hereinafter, SGET) has a track record of developing and operating renewable energy projects at 349 locations nationwide, totaling 727 MW, and has been promoting the introduction of solar and wind power. In addition, we are also working in new areas, developing 5 storage battery projects nationwide totaling 230 MW, and one green hydrogen production facility capable of producing 100 tons of hydrogen annually.

Our group will continue to contribute to the realization of a decarbonized society and the development of a sustainable society through continuous investment in renewable energy projects, storage battery projects, and green hydrogen production projects.

Fund Name Sparks - Storage Battery Investment Business Limited Partnership "Sparks - Storage Battery Fund" Investment Target Equity interests in domestic battery storage projects, other investment securities, etc. Investors General Partner: Sparks Group Co., Ltd. Limited Partners: Resona Bank, Limited, Hulic Co., Ltd., Jōyō Bank, Ltd., and others Operating Agent Sparks Asset Management Co., Ltd.