Gore Street Energy Storage Fund has agreed to acquire a 200MW construction-ready energy storage project in Heysham, North West England from Kona Energy.
The project is one of the largest storage projects in Europe and GSF’s largest acquisition to date.
With this acquisition, GSF’s portfolio will consist of 25 projects with a total capacity of 898MW in operation and construction in the UK, Ireland, Germany and the US.
The project has secured all land rights, grid connection and planning consent.
It will connect to National Grid’s main transmission network rather than the local distribution network, meaning it will operate independently from an intermediary distribution network operator. This will potentially open additional revenue opportunities while reducing capex and operating costs.
This is GSF’s second main transmission-connected site following the acquisition of the 57MW Enderby project in 2021.
Grid connection is expected to be no later than the fourth quarter of 2026; however, GSF’s Investment Manager, Gore Street Capital, will seek to accelerate the connection date while maintaining a cost-efficient EPC procurement process.
The final capex will depend on the selection of the system duration. The project has the flexibility to deploy a storage system with a duration of up to two hours. The project is expected to deliver an unlevered IRR at least in line with GSF’s target return.
Alex O’Cinneide, CEO of Gore Street Capital, commented: “We are delighted by the company’s continued good progress over the past 12 months. Despite recent market volatility, the company’s operational fleet continues to yield higher-than-expected revenue across our markets.
“With the acquisition of this landmark 200MW transmission-connected project from Kona Energy, our largest acquisition yet, the company has further strengthened its leadership position in the GB market.
“We are encouraged that an asset of this scale will benefit from being connected to the main transmission network, providing attractive running cost savings and potential additional revenue streams. We remain very selective on new acquisition opportunities focusing on those, such as this project, with significant cost and revenue advantages.”