Gresham House Energy Storage Fund (GRID) Trading Update summary

Trading and revenue performance

• Full year 2024 portfolio revenues are expected to surpass 2023, driven by capacity growth and recovering revenue per MW rates.

• Portfolio revenues for the first 10 months of 2024 reached £33.8mn, with H2 showing an improving trend after a Q1 low.

• Revenue growth is supported by increased operational capacity, now at 845MW/1,207MWh, set to rise to 1,072MW/1,701MWh.

• Market fundamentals are improving due to rising renewable generation, higher power demand, and reduced coal supply.

Regulatory and market developments

• National Energy System Operator (NESO) is accelerating improvements in battery dispatch rates and promoting a level playing field for BESS.

• The Balancing Programme will launch the Quick Reserve service and new data communication tech, enhancing BESS visibility and reliability.

• UK Government reversed its stance, now including lithium-ion batteries in the Cap and Floor scheme, making longer-duration projects more viable.

• Government focus on 'Clean Power 2030' prioritizes renewables and battery storage for grid decarbonization.

Strategic outlook and company objectives

• Gresham House Energy Storage Fund targets an unlevered NAV total return of 8% p.a. and a levered NAV total return of 15% p.a.

• The three-year plan through 2027 will set targets for capacity, revenues, and EBITDA, to be detailed at the upcoming Capital Markets Day.

• Ongoing capacity rollout and duration increases are expected to capitalize on market recovery and regulatory support.

• Lithium-ion technology is seen as the most competitive for storage up to at least 10 hours, with further cost improvements anticipated.