Gore Street Energy resumes construction on Northern Ireland assets

Energy storage fund Gore Street Energy said on Tuesday that construction has resumed on its two 50MW assets in Northern Ireland, adhering to the strict social distancing measures stipulated by the UK government.

The London-listed firm said that on Monday, the main engineering, procurement and construction (EPC) contractor NEC restarted the programme on both the Mullavilly and Drumkee sites.

Due to its conservative prior assumptions, those assets were still on track to become fully operational in time to secure the “valuable” DS3 uncapped contracts in April 2021.

Construction of the Northern Ireland assets was scheduled to be completed in December, allowing enough time to complete necessary asset testing before the assets go online.

As it had previously guided, the DS3 contracts available for the assets had “highly attractive” return profiles, likely to be considerably higher than its 10% unlevered target internal rate of return for portfolio assets.

Separately, there had been no change to the estimated completion date of the company's two 30MW assets under construction in the Republic of Ireland, Gore Street added.

“We are delighted that construction has resumed so quickly and safely at the company's assets in Northern Ireland and that we remain on track for receiving revenue under the DS3 contracts as per our original acquisition announcement,” said Alex O'Cinneide, chief executive officer of the firm’s investment adviser, Gore Street Capital.

“The planning to enable us to safely resume started from the day after we closed the sites and that effort has delivered this excellent outcome.”

O'Cinneide said the assets perform an “essential and increasingly important” service to balance grid supply in multiple markets, with those services expected to increase in importance.

“Accordingly, performance across all the company's operational assets remains resilient and they continue to produce cash returns in line with expectations.

“Further, our pipeline of potential acquisitions remains robust and we look forward to updating shareholders on our pipeline progress in due course.

“Our partners across the portfolio, both assets in construction and those in operation, are performing a wonderful job in difficult circumstances, as are all of my colleagues in Gore Street.”

At 0940 BST, shares in Gore Street Energy Storage Fund were up 0.16% at 103.16p.