Year-End Update

RNS Number : 7521K

RedT Energy PLC

18 December 2018

 

This announcement contains inside information

18 December 2018

redT energy plc

("redT" or the "Company")

Year-End Update

redT energy plc (AIM:RED), the energy storage solutions company, is pleased to provide a year-end update on its activities.  

Commercial Progress

To date, the Company has approximately 90MWh of energy storage projects under development with a stable, risk-weighted development pipeline comprising more than 1,500 units. This figure is itself a subsection of redT's overall pipeline which stands at £1.07 billion, and comfortably covers analyst forecasts in the market for product sales over the next two years.

In the UK, Australia and Mainland Europe, we continue to see encouraging demand for the Company's Gen 3 energy storage solutions in Commercial & Industrial ("C&I") applications, alongside renewable generation assets, and at the centre of large grid connected projects. redT has previously stated its intention to win a multi-MWh project in the UK market and the Company is currently in final stage discussions on such a project.  

redT is working on a fully financed, solar-plus-storage offering for roll-out to C&I customers, such as water companies and distribution centres, for launch in 2019. The Company is currently in discussions with a number of high profile, global financing partners to deploy infrastructure capital in this regard and looks forward to updating the market on this in due course. 

Australia remains an important market for redT's energy storage solutions and the Company was pleased to announce on 19^th November 2018 that its 1MWh hybrid energy storage solution has been commissioned at Monash University in Melbourne. This 'beachhead' project is a highly significant development, representing the largest behind-the-meter commercial energy storage system to be installed in the country. It is also an important reference site for our technology in what is one of the world's fastest growing markets for energy storage.

We view sub-Saharan Africa as another key region for our energy storage solutions, particularly the mining and national infrastructure sectors. Positive developments, such as the recently announced Distributed Battery Storage Programme by South African utility company, Eskom, which has committed to developing solar-plus-storage and energy storage projects totaling 1,400MWh, serve to increase appetite for flow machines in the region. Once again, with 'beachhead' storage deployments in South Africa and Botswana, redT is well placed to succeed, being at the forefront of this market, and is currently in late stage negotiations on a number of high-profile projects.

Update on German Grid Project

Working with our chosen investment partner, we continue to progress to financial close on the first 40MWh project of our 700MWh German project portfolio.

The Company is also pleased to announce the completion of independent bankability certification on redT's core stack technology, which is a key milestone in order to close project finance for large investment projects and another positive affirmation of our business fundamentals.

Having announced an intention to reach financial close by 31^st December, this has been revised and is now targeted to reach financial close in the New Year. This extension stems from recent modifications to the German market bidding mechanism for the Secondary Control Reserve service, which has required the project partners to undertake additional analysis to assess the impact of the modifications.

Update on Gen 3 manufacture

The Company remains on track to complete the manufacture of its first Gen 3 system, which will be delivered to Anglian Water, the UK's largest water and water recycling company by geographic area. redT's new Gen 3 stack continues to perform very well in testing achieving gains in efficiency and charge/discharge characteristics.

redT's third generation of flow machine combines best in class IP with new, proprietary features designed to maximise performance and financial returns for customers.

Update on Vanadium Pricing

The Company notes the current inflated price of vanadium and reiterates the view held across the market that the price of this abundant commodity will normalise in the medium term.

As previously disclosed, because the vanadium in the electrolyte is neither consumed nor degraded by the energy storage process, redT is able to offer a vanadium electrolyte rental option to its customers, which offsets the abnormally high vanadium price. This allows redT to continue to offer its systems at competitive prices which deliver attractive business model returns for its core customers.  

redT's infrastructure energy storage applications are well suited to the electrolyte rental model as the potential customers are located in developed markets, possess high credit ratings and so provide ideal counterparties for long term vanadium rental agreements.

Update on Strategic Partners

In line with the Company's announcement on 3^rd October 2018, the Company has been seeking one or more strategic partners to invest in the growth of redT and has appointed financial advisers to assist with the process. 

The recent success of redT's commercial energy storage business models, particularly with a focus of unlocking more cheap renewables and energy costs savings, puts redT at a significant competitive advantage amongst its peers, strengthening the investment proposition which has generated initial interest from a number of potential, global strategic partners.

Scott McGregor, CEO of redT said:

"As demonstrated by our recent activities, redT's underlying business is performing very well across all functions. Commercially, our teams have maintained sharp focus on specific applications for energy storage where there is a real ability to unlock more cheap renewables and energy cost savings. This has enabled redT to develop a strong pipeline and credible traction with key infrastructure investors and stakeholders in the energy sector.

From a technical perspective, our Gen 2 technology has been delivered successfully and is now operational in the UK, Australia, Africa and South East Asia. Manufacturing of our Gen 3 product is on schedule with the first customer system now nearing completion. We are looking forward to inviting our investors and customers to a showcase event in the New Year where we plan to demonstrate the improved capabilities of this market leading product.

redT has achieved a lot this year in successfully differentiating itself in the energy storage sector and delivering our solutions into different applications around the globe. I'd like to thank the team for all their efforts this year and our partners and investors for their continued support.  

In 2019, we look forward to attracting strategic investment partners, rolling out our financed C&I PV & energy storage solution and delivering our large, grid scale "mega" projects."

Enquiries:

redT energy plc	[phone]
Scott McGregor, Chief Executive Officer Fraser Welham, Chief Financial Officer
Joe Worthington, Investor & Media Relations
Investec Bank plc (Nominated Adviser and Broker)	[phone]
Jeremy Ellis / Chris Sim / Alexander Ruffman
VSA Capital (Joint Broker) Andrew Monk / Andrew Raca	[phone]
Celicourt Communications (Financial PR) Mark Antelme Jimmy Lea Ollie Mills	[phone]

Notes to Editors

About redT energy

redT energy plc are experts in energy storage, specialising in the design, manufacture, installation and operation of energy storage infrastructure which creates revenue alongside reliable, low-cost renewable generation for businesses, industry and electricity distribution networks. Using patented vanadium redox flow technology to store energy in liquid, redT's own energy storage machines can be run continually with no degradation: charging and discharging for over 25 years, matching the lifespan of renewable assets in on-grid, off-grid and weak-grid settings.

redT's energy storage solutions, developed over the past 15 years, address today's changing energy market by providing a flexible platform for time shifting surplus renewable power, securing electricity supplies and earning revenue through grid services. The company has customers in the UK, Europe, sub-Saharan Africa, Australia and Asia Pacific. redT energy plc is listed on the London Stock Exchange (AIM:RED) and has experts located in the UK, Europe, Australia, Africa, Asia and the USA. For more information, visit www.redTenergy.com

 For sales, press or investor enquiries, please contact the redT team on [phone].

 

END

 

 

STRTRBLTMBABBBP