Early participants ‘leaving storage market’ says Gore Street chair, as company plans Europe and US expansion

The storage maret is consolidating, according to the chair of specialist fund Gore Street Energy Storage. In its annual report chair Patrick Cox said, “The regulatory and market frameworks for energy storage are maturing rapidly with many early participants leaving the energy storage market as the required level of expertise and performance increases.”
The company says it is now the largest operator of energy storage on the Irish grid, with an estimated 66% market share, and it has 10% market share in Great Britain. It highlighted higher returns in the past year, saying that GB NGESO’s Dynamic Containment product, which started in October 2020, “resulted in the company earning approximately double the revenue price of last year’s frequency response service”. Changes to market regulations – reduced levies on stand-alone storage facilities, lower capacity charges and exemption from variable BSUoS charges – could also reduce the operating costs.
It said in the NI and RoI market the so-called ‘D3’ ancillary services market was “the most complex packages of grid balancing activities available in the world” but claimed its “management of the DS3 complexities is rewarded by lucrative revenues with potential to exceed the 10% IRR target”.
Gore Street’s operating portfolio of eleven battery installations totalled 210MW at year-end in March, with 190MW under construction. That includes the company’s first activity in Scotland, the acquisition of Ferrymuir in June 2020, where construction is expected to start in the last quarter of 2021.
Further development acquisitions, including a its largest project to date, the 80MW Stony Energy Storage, have brought its portfolio to 520MW – up from 189MW in March 2020.
The company now has a project acquisition pipeline of 880MW with 300 MW under exclusivity, including sites in Continental Europe and the USA.
Most assets were operating near nameplate portfolio capacity at an average of 98%, it said, with the exception of NK Boulby. That 6MW installation had periods of unplanned downtime during the fiscal year. By year end it was operational and delivering frequency response services at a reduced capacity of 4MW, and retrofit is planned to restore its capacity.