Despite macroeconomic challenges, Gore Street’s asset value surged 45% over the six months from 31 March 2022, as ancillary service revenues stayed strong.
The UK-headquartered battery energy storage fund highlighted the impact of rising short-term inflation, rising interest rates, high foreign exchange (FX) volatility and increasing construction costs on its portfolio.
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During the period, Gore Street Energy Storage Fund’s total portfolio increased to 698.2MW from 628.5MW as of 31 March 2022. It had 16 operational projects, with a total capacity of 291.6MW across four markets: Britain, Ireland, Germany and the ERCOT market in Texas. This is up from 12 projects with a capacity of 231.7MW as of the end of March.
“I am pleased to report another successful period of growth as we continue to deliver on our strategic objectives of providing an attractive level of returns to shareholders despite the changing macro inflationary environment through providing an essential service enabling the renewable transition and enhancing energy security,” said Alex O’Cinneide, CEO of Gore Street Capital, the investment adviser to the company.
“The portfolio grew significantly during the period, with total capacity reaching nearly 900MW in aggregate post-period end, of which 291MW is operational and generating strong cash flow for the company.”
Gore Street’s British assets made up the bulk of the company’s revenue during the period, benefitting from the significant volatility in the market. The revenue was predominantly derived from Dynamic Containment and Firm Frequency Response ancillary services, as they offered the best returns with the Capacity Market adding to the revenue stack.
Gore Street’s net asset value (NAV) grew from £369.6 million (US$448.36 million) in March 2022 to £534.79 million as of September 2022. Its NAV per share increased 3.7% to 111.1 pence, and its NAV total return was 4.65% for the period.
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