TIDMGSF
RNS Number : 7386O
Gore Street Energy Storage Fund PLC
04 October 2019
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Gore Street Energy Storage Fund plc
(the "Company" or "Gore Street")
Further Positive Progress on Irish Assets
Investment in Gore Street by Sovereign Wealth Fund
Gore Street Energy Storage Fund plc (ticker: GSF), London's
first listed energy storage fund investing in income producing
assets in the UK and internationally, is pleased to announce
significant positive developments in the Company's acquisitions in
the Republic of Ireland ("RI Projects") and an additional funding
commitment from the Company's strategic partner, the National
Treasury Management Agency ("NTMA"):
-- The RI Projects won two 6-year fixed revenue contracts in the
recent Irish Government tender for storage, a significant
proportion of the available capacity in this tender. The RI
Projects have an estimated IRR of 10%[1];
-- NTMA, Ireland's sovereign wealth fund has committed GBP9.5m
to be used by the Company for developing the RI Projects, cementing
NTMA's relationship as one of our key strategic investors.
With the acquisition of the RI Projects, the Company will now
have assets in two distinct storage markets - England and Wales and
Northern Ireland and Republic of Ireland, providing the Company
with the most geographically diverse project portfolio in the
listed storage market. The RI projects also offer longer-term fixed
revenue streams, enhancing the Company's future revenue certainty.
The RI projects are expected to generate revenue from September
2021.
On 4 June 2019, the Company acquired the rights to purchase
controlling interests in a portfolio of four projects totalling
160MW in Northern Ireland ("NI Projects") and the Republic of
Ireland ("RI Projects") from renewable energy developer, Low Carbon
subject to the RI Projects' receipt of grid and revenue contracts.
The 160MW includes the RI Projects, each with 30MW of capacity
located in Portersdown, County Kildare and Kilmannock, County
Wexford.
The Irish government is determined to support energy storage
within the Delivering a Secure Sustainable Electricity System
programme (the "DS3 Programme"). The purpose of the DS3 programme
is to enable Ireland to meet its target of 75% non-synchronous and
renewable (i.e. wind and solar) electricity across the all-island
network. The DS3 market consists of both fixed and standard
contracts available across the Irish grid in both the Republic of
Ireland and Northern Ireland.
On 9 August 2019, EirGrid announced that the RI Projects' bids
in the highly competitive DS3 capped market tender were successful
and the projects were awarded contracts for the full 60MW of
capacity. The DS3 contract is a 6-year fixed contract and thus
represents one of the longest contracts available to investors in
storage globally for high value frequency services.
The RI Project vehicles have executed the DS3 contracts on 24
September 2019 and made payments of fees necessary to begin grid
connection works. The estimated capex required to complete the
projects is estimated to be c. GBP24.0m, 40% of which is to be
funded by the NTMA.
Gore Street expects to continue the tender process on EPC
providers started by the projects' developer, Low Carbon, with
selection anticipated by Q1 2020. The assets are expected to be
fully operational by September 2021.
NTMA and the RI Projects
Under the subscription agreement announced on 4 June 2019, the
Company is eligible to draw down funds amounting to a maximum of
GBP25.0m from NTMA. NTMA will subscribe for new ordinary shares in
the Company for a total investment equivalent to 40% of the RI
Projects' acquisition and construction costs. The Company will draw
down GBP9.5m from NTMA.
New Ordinary Shares will be issued under the terms of the
Subscription Agreement and outlined in the Prospectus (dated 16
July 2019). It is expected that admission will become effective and
dealings in the new Ordinary Shares will commence on 11 October
2019. The new Ordinary Shares shall rank pari passu with the
existing Ordinary Shares in the Company. A further announcement
will be made in due course.
Alex O'Cinneide, CEO of Gore Street Capital, the Company's
investment adviser, commented:
"We are extremely pleased to announce that both of our submitted
projects won the DS3 tender. This was a highly competitive auction
process in which we secured 60MW out of 110MW awarded capacity. We
believe this success is a testament to the depth of the investment
adviser's expertise in this nascent market where we were able to
price our bid correctly and receive the entire 60MW of capacity
that we were seeking on this occasion. These projects, with 6-year
contracts, provide greater revenue visibility and stability moving
forward. Additionally, we are also delighted to receive a further
GBP9.5m of capital from our strategic investment partners, NTMA, as
we continue to grow the fund and diversify our assets under
management to provide further sources of income for our
shareholders. Since its IPO we have increased the fund portfolio
from 8MW to 189MW, built out a multinational portfolio and added
significant investors to our shareholder base.
We are also pleased that our portfolio covers two distinct
energy storage markets in England and Wales and Northern Ireland
and Republic of Ireland. This gives the Company considerable
diversity and the benefits that flow from that diversity, including
revenue sources and duration and regulatory and country risks."
Notes to Editors:
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.
Further information is available at
www.gorestreetcap.com/energy-storage-fund/
For further information:
Gore Street Capital Limited Tel: +44 (0) 20 3826 0290
Alex O'Cinneide
Shore Capital Tel: +44 (0) 20 7408 4090
Daniel Harris, Hugo Masefield (Corporate Advisory)
Henry Willcocks, Fiona Conroy (Corporate Broking)
Media Enquiries
Buchanan Tel: +44 (0) 20 7466 5000
Charles Ryland / Steph Watson / Henry Wilson Email: Gorestreet@buchanan.uk.com
Company Secretary
JTC (UK) Limited Tel: +44 (0) 20 7409 0181
The Legal Entity Identifier of the Company is
213800GPUNVGG81G4O21.
[1] These are targeted only which are based on a number of
assumptions that may not materialize. There can be no guarantee
that the fund will generate these or any returns.
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END
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