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viewGore Street Energy Storage Fund PLC

Gore Street Energy Storage upbeat as battery momentum grows

Snapshot

Recent investment from Japanese oil group JXTG underlines the shift in sentiment towards renewables

battery

Quick facts: Gore Street Energy Storage Fund PLC

Price: 105.15 GBX

LSE:GSF
Market: LSE
Market Cap: £81.15 m
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  • Fast-growing energy storage fund 
  • Demand is driven by fossil fuel decommissioning
  • The aim is to generate a 7% dividend yield for investors

What it does

Gore Street (LON:GSF) provides energy storage for the National Grid and its equivalent in Ireland using nothing more sophisticated than the lithium-ion battery technology that powers your phone or electric cars (but on a much larger scale).

Demand is driven by the decommissioning of fossil fuel and nuclear facilities and the switch to green energy sources, which are now responsible for 40% of UK’s energy requirements.

The unpredictability of the wind and solar means there has to be infrastructure to store electricity in times of plenty that feeds it into the system to balance the grid as well as contributing at times of peak demand. 

“Without assets such as ours, renewables would not work; the grid would fall over,” said adviser Alex O'Cinneide. “Our assets become the stabilisation force.”

Yield target

While undoubtedly providing an important service, Gore Street’s aim in doing so is to deliver a healthy return for its investors in the form of a 7% dividend yield.

How it’s doing

Gore Street saw its net asset value (NAV) increase by 1.7% to 96.2p in the quarter to end June 2020.

The trust said its portfolio of UK battery assets did well helped by recent acquisitions while the construction of its Irish assets is on track.

The dividend for the quarter was 2p, which is in line with the fund’s annual target of 7p.

In the previous fiscal year, to March 30, 2020, Gore Street’s NAV rose to 94.6p per share from 91.9p.

What the manager says; Alex O'Cinneide

"We are pleased with the continued performance of Gore Street's operational assets including acquisitions and good progress in the development of the company's Irish assets, which is reflected in a significant NAV uplift for Q1 financial year 2021.

“The company's attractive 7p annual dividend target for the fiscal year reinforce its defensive qualities during the Covid-19 era as the Company's assets continue to perform an essential service in balancing electricity grids".

Inflexion points

  • Additional acquisitions of both operational assets and those under development
  • Yield target of 7%
  • Recent investment from Japanese oil group JXTG

Blue Sky

Industry experts see the potential for at least 30,000 MW in additional storage installations if the UK is serious about reaching its long-term climate targets

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Gore Street Energy's Alex O'Cinneide sees strong growth and returns for...

Gore Street Energy Storage's (LON:GSF) Alex O'Cinneide says the decline in lithium-ion batteries and growth in renewables bodes well for the continued growth for energy storage as an asset class. ''Our increasing use of renewable energy is exactly why we have a need for energy storage'', he...

on 12/8/20

2 min read