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Gore Street Energy Storage Fund PLC revenues boosted amid market volatility

“We are only at the start of the growth curve in our industry, as energy storage continues to play an increasingly vital role in balancing energy systems”

Gore Street Energy Storage Fund PLC said its assets in Great Britain generated revenues two times above forecast in September and added that industry is only at the start of its growth curve.

The company, which is invested in energy storage and power balancing assets, highlighted that rising revenue was the result of increasing energy prices and the assets’ ability to respond to quickly respond to market opportunities.

The favourable market conditions are expected to continue in the short-term, it added.

“It is a critical time for the energy infrastructure systems of the GB and Irish grids as they continue to face new challenges to deliver consistent energy supply and meet our important obligations towards further onboarding intermittent sources of renewable power,” said chief executive Alex O’Cinneide.

“We are only at the start of the growth curve in our industry, as energy storage continues to play an increasingly vital role in balancing energy systems.”

O’Cinneide added: “We will continue to monitor closely the situation in the energy markets going forward over the winter months and shall optimise revenue stacking strategies to create additional value for our shareholders.”

The company, in a trading statement, noted that its main revenue streams presently are in Dynamic Containment (DC) and Balancing Mechanism (BM) – the former being one of National Grid’s frequency response services, which reacts quickly to spikes in usage, and the latter is used by National Grid as it buys and sells electricity from market participants to manage constraints and allow an overall energy balance in real-time.

The pricing in BM hit a new record high of £4,038 per megawatt-hour in early September. For context, Gore Street noted, that the last time that BM prices spiked as rapidly, in early 2021, the price set new twenty-year highs at around £2,750 per MWh.

In Ireland, similar mechanisms are in place, and similarly the price spiked in September to reach €4,680 per MWh during evening peaks.

Gore Street noted that industry consensus sees continuing volatility and high prices throughout the winter and that National Grid has warned of tight margins due to supply uncertainty.

It said that volatility, more so than simply higher prices, is an important driver of trading opportunities for Gore Street and it believes it is well-positioned to capitalise on the trading opportunities that the market currently presents.

In Wednesday’s statement, O’Cinneide highlighted: “Gore Street’s portfolio of technologically advanced assets uniquely combined with our in-house expertise of engineering and energy markets, means that we are well-positioned to capitalise on the highly attractive pricing available for our services, just as we did when we took first-mover advantage and moved our GB portfolio into Dynamic Containment contracts during Q3 2020.”

Read More: Gore Street Energy Storage Fund PLC revenues boosted amid market volatility

2021-10-20 04:22:00

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