Investment firm Gore Street Energy Storage Fund has detailed that its portfolio generated an average revenue of £16.1/MWh in January and February 2024.
Detailed within its fourth quarter 2023 financial results, the fund achieved a net asset value (NAV) of £549.8 million, an increase on the previously reported £543.3 million at the end of September 2023.
Gore Street confirmed that its GB portfolio also achieved an estimated 15% of total revenue during Q4 2023. The company’s consolidated portfolio generated an estimated average of £15.12/MWh during the company’s third financial quarter.
A key revelation in the results is that Gore Street’s GB exposure, as a percentage of its operational capacity, is expected to fall to c.30% on a MWh basis by the end of 2024. All other long-term assumptions remain unchanged, the firm said.
GB Capacity Market results
Gore Street also secured several contracts from the February 2024 Capacity Market auctions. This includes T-1, which cleared at an average of £35/kW/year, and T-4, which cleared at an “all-time high” of £65/kW/year.
In the T-1 auction, Gore Street secured contracts for four projects at a clearing price of £35.79/kW for delivery in 2024/25. In the T-4 auction, the firm secured additional contracts for five projects at £65/kW, scheduled for delivery in 2027/28.
The company said the new contracts have a combined value of c.£1.7 million. It is worth noting that these contracts typically contribute around 10% of the company’s GB revenue, it confirmed.
Gore Street’s diversified portfolio mitigates storage revenue woes
According to Gore Street, the company’s internationally diversified portfolio enabled the company to mitigate some of the woes being witnessed in the GB battery energy storage system (BESS) market, something it highlighted as being worrisome in early February.
Both Harmony Energy Income Trust and Gresham House Energy Storage Fund also expressed concerns over the low revenues many across the GB BESS market are being subject to earlier this year. This has primarily been due to assets not being able to participate in balancing the GB grid or replacing gas-fired generation to their fullest capability.
Commenting on this, Alex O’Cinneide, CEO of Gore Street Capital, the investment manager of the company, said: “The collapse of pricing in the GB market has affected the whole sector, but the market is realising the value in the resilience of the company’s international portfolio and strength of the investment manager’s active management strategy.
“This value was showcased over the December-end quarter, with the consolidated portfolio delivering estimated average returns of £15.1/MW/hr, consistent with the previous six months and more than double that of GB alone. The Northern Ireland portfolio was particularly strong, providing record estimated revenues of £31.4/MW/hr over the latest quarter to maintain performance during seasonal variations within the portfolio.”