TIDMGSF
RNS Number : 4303Y
Gore Street Energy Storage Fund PLC
13 May 2021
13 May 2021
Gore Street Energy Storage Fund plc
(the "Company" or "Gore Street")
Attractive 80MW UK Acquisition
Pipeline and Portfolio Update
Gore Street, London's first listed energy storage fund
supporting the transition to low carbon power, is pleased to
announce the acquisition of an 80MW construction ready energy
storage project (the "Project"), in Milton Keynes, England. The
expected total capex for the Project is estimated to be c.GBP30m
spread over the next 12 to 15 months.
The Company is also pleased to provide a further positive
pipeline update that it has entered into exclusivity on over 300MW
of assets which are currently subject to due diligence and are
expected to close in the coming months.
80MW Acquisition
The Project, which has been acquired from RES, a leading
renewable energy company with an exceptional track record of
delivering high quality energy storage assets, consists of an 80MW
energy storage system in Milton Keynes, for which all land rights,
grid connections and planning consents have already been secured.
The Project is currently scheduled to become operational in Q1
2023, though Gore Street is exploring timeline optimisation to
potentially bring this target forward. At 80MW, this is one of the
single largest energy storage assets in the UK.
Gore Street's investment manager, Gore Street Capital Limited
(the "Investment Manager"), estimates the Project will have an
unlevered IRR in-line with Gore Street's target range of
10-12%.
Pipeline Update
The Company is also pleased to announce that it has secured
exclusivity on a further 300MW of assets in the UK, which are
currently undergoing due diligence. These projects are with leading
developers and present opportunities for acquiring assets at highly
competitive prices. As with other assets under construction,
capital expenditure requirements would be staggered over a
12-to-18-month period and are dependent on certain milestones being
achieved. In total, the Company now has over 1.0GW in its pipeline
across the UK, Europe and North America.
Portfolio Update
On 30 March 2021, EirGrid granted a 12-month extension to the
lucrative DS3 contracts in Ireland, until April 2024. This
extension is expected to provide significant additional revenue
generation for all 4 sites located in Ireland, including Mullavilly
and Drumkee which have been operational since March 2021.
During Q1 2021, in-line with the Investment Manager's approach
to optimise value through the portfolio's ability to capitalise
flexibly on the highest risk adjusted revenue available, the
Company paused Dynamic Containment strategies on certain assets for
short periods of time in order to capture particularly high trading
revenues available in the market, providing increased
profitability. This is a further confirmation that the Investment
Manager is constantly assessing revenue options and profitability
maximisation and remains a key aspect of Gore Street's revenue
stacking strategy.
Although it remains the case that Grid Balancing contracts are
currently more profitable than Trading most of the time, Gore
Street has demonstrated its ability to participate in different
markets and opportunistically capture market prices when
attractive.
In addition to being the newest portfolio of assets available to
a financial investor, over 75% of the Company's portfolio consists
of 1 hour duration batteries. The Company believes these assets are
the most cost-efficient energy storage assets available today and
best suited to execute flexible revenue stacking services over the
long term, as well as being part of a portfolio which is designed
to be capable of upgrade to meet the changing needs of the
market.
Alex O'Cinneide, CEO of Gore Street Capital, the Company's
Investment Manager, commented:
"We are very pleased to announce the acquisition of this
exceptionally high-quality 80MW construction ready project in the
UK, which adds one of the UK's largest assets planned for
development to our leading portfolio of energy storage assets. At
520MW ([1]) this is the largest portfolio available to a financial
investor and one which has the youngest portfolio of assets, and
most cost-effective acquisition history in the market. This latest
Project again highlights the strength of our management team in
being able to identify and secure exclusivity on important
infrastructure assets at extremely competitive pricing, through our
active asset management approach. In fact, the Company believes
that GSF's installed cost per MW is close to half that of the
closest peer that we have analysed. We believe this competitive
acquisition pricing is the bedrock for continuing to deliver future
compelling IRR returns to our shareholders.
Gore Street's 300MW in exclusivity represents an extraordinary
opportunity for the Company to acquire nationally significant
energy storage assets in the UK at a competitive price through the
Investment Manager's leading contact network as a highly regarded
first mover. We expect to update the market in due course with our
further progress in relation to the pipeline and expanding our
portfolio."
The Legal Entity Identifier of the Company is
213800GPUNVGG81G4O21.
The person responsible for releasing this announcement is Susan
Fadil.
For further information:
Gore Street Capital Limited
Alex O'Cinneide / Paula Travesso Tel: +44 (0) 20 3826 0290
Shore Capital (Joint Corporate Broker and Joint Bookrunner)
Anita Ghanekar / Hugo Masefield (Corporate Advisory) Tel: +44 (0) 20 7408 4090
Henry Willcocks / Fiona Conroy (Corporate Broking)
J. P. Morgan Cazenove (Joint Corporate Broker
and Joint Bookrunner)
William Simmonds / Jérémie Birnbaum Tel: +44 (0) 20 7742
(Corporate Finance) 4000
Buchanan (Media enquiries)
Charles Ryland / Henry Wilson / George Beale Tel: +44 (0) 20 7466 5000
Email: Gorestreet@buchanan.uk.com
JTC (UK) Limited, Company Secretary Tel: +44 (0) 20 7409 0181
Notes to Editors
About Gore Street Energy Storage Fund plc
Gore Street is London's first listed energy storage fund and
seeks to provide shareholders with a significant opportunity to
invest in a diversified portfolio of utility scale energy storage
projects. In addition to growth through exploiting its considerable
pipeline, the Company aims to deliver consistent and robust
dividend yield as income distributions to its shareholders.
The Company targets an annual dividend of 7.0% of NAV per
Ordinary Share in each financial year, subject to a minimum target
of 7.0 pence per Ordinary Share. Dividends are paid quarterly.
Disclaimer
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED TO
CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE UK'S MARKET
ABUSE REGULATION. UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS
INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC
DOMAIN.
The information in this announcement may include forward-looking
statements, which are based on the current expectations, intentions
and projections about future events and trends or other matters
that are not historical facts and in certain cases can be
identified by the use of terms such as "may", "will", "should",
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variations thereof or comparable terminology. These forward-looking
statements, as well as those included in any related materials, are
not guarantees of future performance and are subject to known and
unknown risks, uncertainties, assumptions about the Company and
other factors, including, among other things, the development of
its business, trends in its industry, and future capital
expenditures and acquisitions. In light of these risks,
uncertainties and assumptions, the events in the forward-looking
statements may not occur and actual results may differ materially
from those expressed or implied by such forward looking statements.
Given these risks and uncertainties, prospective investors are
cautioned not to place undue reliance on forward-looking
statements.
[1] Includes the 120MW in expansion process; of which Manager
has received the option to increase capacity of Porterstown from
30MW to 90MW, and has applied to increase Kilmannock from 30MW to
90MW
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