GSEO commits £50m to Australian Energy Transition

RNS Number : 1570H

VH Global Sustainable Energy Oppt.

02 August 2021

 

VH Global Sustainable Energy Opportunities plc (the "Company")

2nd August 2021

GSEO commits £50m to Australian Energy Transition

VH Global Sustainable Energy Opportunities plc begins Australian renewable power generation & storage investment programme in third deal since IPO

VH Global Sustainable Energy Opportunities plc ("GSEO") - a London-listed investment trust - is pleased to announce a commitment of £50m to acquire a portfolio of distributed solar generation assets with plans to build embedded battery storage capacity. The commitment will be split into two deployment tranches the first of which will be for £15m.

The first tranche involves the acquisition of two operating solar photovoltaic ("PV") sites, totalling 17MW DC, in South Australia and Queensland, where there are opportunities to support the Energy Transition utilising energy storage. A critical part of the investment strategy will be to help stabilize the grid and decrease the curtailment of renewable power generation by adding 1 to 2hr battery storage capacity at each site. The deployment programme will continue to extend across the country and focus on remote sites that are typically located close to clusters of commercial and industrial consumers. The aim of the strategy is to provide greater access to clean and dependable energy in remote load centres while helping accelerate the Energy Transition in Australia.

Both initial solar PV generation assets combine merchant sales and long-term corporate PPA revenues as well as Large-scale Generation Certificates ("LGCs"). In addition, investors will also benefit from revenues stemming from profitable energy arbitrage opportunities and frequency services revenues.

An independent assessment of the project, as per the process, has concluded that it is compliant with the Company's six relevant Sustainable Development Goals - goals 3, 7, 8, 9 13 and 17 - and will do no harm in the context of the remaining eleven goals.

Victory Hill will be partnering with Birdwood Energy which was founded by energy entrepreneurs Scott McGregor, Leigh Newbery and Graeme Ludlow. The Birdwood team are highly experienced in battery storage and renewable power generation development and operation, with a global track record. They bring world-class expertise in the optimisation of hybrid solar and battery storage systems as well as a network of high quality commercial and industrial customers to enhance the value of the portfolio.

The levered return is expected to be ahead of the Company's target annual dividend yield of 5% and be in line with its target return of 10%.

To date, approximately 59% of the net proceeds raised on IPO have now been committed or deployed.

Richard Lum, Co-Chief Investment Officer of Victory Hill Capital Advisors LLP, adviser to GSEO, said: "We are very cognisant of the journey which Australians have embarked on to meet the challenges of addressing climate change, whilst ensuring that the country benefits from a reliable energy system in which renewable power generation becomes fully integrated. We are thrilled through this acquisition, to be part of this strong momentum to achieving global sustainable energy through investing in the fight against climate change and ensuring energy access for local communities and businesses in Australia."

Scott McGregor, CEO of Birdwood Energy, said:

"After decades of experience designing and optimising batteries around the world, the Birdwood Energy team see this partnership as an important example of fast-tracking investment into distributed energy to unlock the transition to a net zero economy. The Australian market is ripe to benefit from additional flexibility by utilising energy storage."

www.vh-gseo.com

The Company's LEI is 213800RFHAOF372UU580.

For further information, please contact:

Quill Communications Limited (PR Adviser)

Sarah Gibbons-Cook

Tel: + 44 (0)20 7466 5050 / [phone]

Email: [e-mail]

Numis Securities Limited (Corporate Broker)

David Benda / Matt Goss / Tod Davis

Tel: [phone]

G10 Capital Limited (AIFM)

Mohammed Rahman / Paul Cowland

Tel: + 44 (0)20 3696 1302

Apex Fund and Corporate Services (UK) Limited (Company Secretary)

Anthony Lee

Tel: [phone]

About Victory Hill Capital Advisors LLP

Victory Hill Capital Advisers LLP is the investment-focused subsidiary of Victory Hill Capital Group LLP. Victory Hill Capital Advisors LLP (FRN 938594) is an Appointed Representative of G10 Capital Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 648953).

Victory Hill is based in London and was founded in May 2020 by an experienced team of energy financiers that have spun-out of a large established global project finance banking group. The team have an established track record built over six years while working together in their previous roles and participating in over $37.1bn in sustainable energy project transaction values, generating over 24.2 per cent. equity returns. In addition, the team has also participated in more than $200bn in transaction values across 91 conventional and renewable energy-related transactions in over 30 jurisdictions worldwide, throughout their individual careers. The average experience per individual is 21 years of relevant energy finance experience.  Victory Hill Capital Advisors LLP is the investment adviser entity of the Victory Hill group.

The Victory Hill team deploys its experience across different financial disciplines in order to holistically assess investments from multiple points of view. The firm pursues operational stability and well-designed corporate governance to generate sustainable positive returns for investors. It focuses on supporting and accelerating the Energy Transition and the attainment of the UN Sustainable Development Goals.

VHCA is a signatory of the United Nations Principles for Responsible Investing (UN PRI), the United Nations Global Compact (UN GC) and is a formal supporter of the Financial Stability Board's Task-Force on Climate-related Disclosures (TFCD).

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