Gore Street Energy Storage Fund PLC GB Capacity Market Contracts and Portfolio Update (0625R)
February 27 2023 - 1:00AM
UK Regulatory
TIDMGSF
RNS Number : 0625R
Gore Street Energy Storage Fund PLC
27 February 2023
27 February 2023
Gore Street Energy Storage Fund Plc
('GSF' or the 'Company')
GB Capacity Market Contracts and Portfolio Update
Gore Street Energy Storage Fund (the "Company"), the
internationally diversified energy storage fund, is pleased to
announce the following update. GSF notes the recent Capacity Market
auction, in particular, in which contracts were secured at
record-level prices.
GB Capacity Market Auction Results
-- The Company secured contracts in the 2023 T-4 auction across
six sites. These contracts are expected to commence delivery in
October 2026 and have a combined value of c. GBP45 million. They
will provide a consolidated revenue of c. GBP3.76 million between
October 2026 and September 2027. The 200MW (Middleton site) is
expected to generate GBP2.97 million annually in Capacity Market
revenues for 15 years (subject to CPI adjustments) .
-- The Company also secured contracts for three sites in the
2023 T-1 Capacity Market auction. The contracts, which have a
combined value of GBP1.8 million, will provide critical capacity to
the UK's National Grid and are set to commence on 1 October 2023,
lasting for a period of one year.
-- The revenue outlined above is in real terms and is expected
to be adjusted upwards for inflation.
Portfolio Update
In line with the Company's gearing policy, as set out in the
Prospectus dated 29 March 2022, the Company may utilise debt up to
30% of gross asset value. Although this permits the Company to
borrow up to c. GBP230 million inclusive of the GBP15 million RCF
currently in place, utilisation of this capacity will depend on the
cost of debt and the return available on investment. The Investment
Manager is engaging with the debt markets and reports strong demand
from lenders at both project and portfolio levels. Shareholders
will be updated on the outcome of these discussions in the near
term.
Gore Street's investment manager, Gore Street Capital Limited
(the "Investment Manager"), estimates the total capex requirement
to build out the Company's portfolio will be c. GBP370 million
(inclusive of contractual commitments already entered) between now
and 2026. Out of the GBP370 million, c. GBP173 million is expected
to be deployed in the next 12 months. As disclosed in the Company
announcement on 17 February 2023, the Company currently has c.
GBP144 million in cash or cash equivalents. The Company intends to
employ its current cash balance and a level of debt in line with
its gearing policy to meet the capex requirement to complete the
construction of its portfolio.
Alex O'Cinneide, CEO of Gore Street Capital, commented:
"We are pleased to have secured contracts for our portfolio in
the 2023 T-1 and T-4 Capacity Market auctions, reflecting the
importance of energy storage in supporting the stability of the
grid and the growth of renewable energy sources. The contracts -
worth a combined total of GBP1.8 million and GBP45.4 million,
respectively - will serve as a reliable source of revenue and
support the Company in realising its plan, articulated to investors
during our most recent funding round, of using operational revenue
to cover dividend payments from future quarters onward.
"As we look forward, we are exploring opportunities to expand
our portfolio and take advantage of strong international markets
for energy storage assets. While we are very well-capitalised, we
recognise the potential benefits of judiciously utilising debt to
finance our next phase of growth.
"We will continue to pursue a balanced approach to capital
allocation, ensuring we retain the flexibility to respond to
changing market conditions while continuing to focus on operational
excellence to deliver further attractive returns to our
shareholders."
For further information:
Gore Street Capital Limited
Alex O'Cinneide / Paula Travesso Tel: +44 (0) 20 3826 0290
Shore Capital (Joint Corporate Broker)
Anita Ghanekar / Rose Ramsden / Iain Sexton (Corporate Advisory) Tel: +44 (0) 20 7 408 4090
Fiona Conroy (Corporate Broking)
J. P. Morgan Cazenove (Joint Corporate Broker)
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
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 an 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.
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