VH Global commits £78m to UK flexible power generation

VH Global commits £78m to UK flexible power generation

LONDON, UK: VH Global Sustainable Energy Opportunities plc – a London-listed investment company advised by Victory Hill Capital Advisors LLP – is pleased to announce a £78m programme commitment to fund innovative net zero flexible power generation projects in the UK, which support the energy transition towards more renewable power generation.

GSEO’s investment will fund the construction of two combined heat and power plants which bring together high-efficiency, gas-fired engines technology with a carbon capture and re-use system to provide a clean, net-zero, flexible and dependable electricity solution for the UK. The combined capacity will be 45MW, with assets at the ready-to-build stage, with full planning permissions and commercialisation plans in place.

The first plant will begin construction in Q4 2021 in Nottinghamshire, with a second plant in County Durham expected to be begin construction by Q2 2022. Once operational, the plants will be contracted under long term Power Purchase Agreements (PPAs) with well-known energy companies for the power output, and long-term CO2 offtake contracts with large industrial companies for the carbon. Together, these revenue arrangements will provide the plants with downside risk protection and visibility of revenues for the medium-to-long term. The unlevered returns are expected to exceed the Company’s target return of 10% and target annual dividend yield of 5%.

The plants’ construction will incorporate a range of well-established and proven technologies which, when combined, materially increase the efficiency of the plants. The plants will benefit from the involvement and expertise of some of the world’s leading industrial technology companies including Rolls Royce (Ticker: RR:LN), Swedish industrial group, Climeon (Ticker: CLIMEB:SS), Mitsubishi Heavy Industries Group subsidiary Turboden based in Italy (Ticker: 7011:JP) and privately-held Swiss Carbon Capture technology manufacturer, ASCO Carbon Dioxide Ltd.

Once operational, the projects will produce highly efficient flexible power, which will help secure the supply of power within the UK electricity grid and contribute to the growth in renewable generation capacity. At present, energy security is predominantly provided by higher carbon unabated sources such as coal fired power plants and large, gas fired generators. The projects will therefore play an important role in the development of a more resilient and sustainable power infrastructure in the UK for years to come.

Victory Hill will be partnering with Landmark Power Holdings Ltd. a specialised developer and operator of gas-fired power plants, and the owner of these unique and highly differentiated plant designs. The Team’s principals bring a wide range of expertise from past roles at leading firms such as PowerGen, RWE, Sterling & Wilson, British Energy and JP Morgan.

The projects will be supported by the established engineering, procurement, and construction capabilities of UK-based Smith Brothers Contracting Limited a specialist high voltage engineering and contracting group.

An independent assessment of the projects, as per the process, has concluded that they are compliant with the Company’s six Sustainable Development Goals – goals 3, 7, 8, 9 13 and 17 – and will do no harm in the context of the remaining eleven goals.

To date, 92% of the net proceeds raised on IPO have been committed or deployed.

 Richard Lum, Co-CIO of Victory Hill Capital Advisors LLP, investment adviser to GSEO, said: “The UK harbours ambitious plans to hit net zero carbon emissions by 2050 and is rightly increasing capacity for renewable power generation. At the same time, fossil fuel generators continue to leave the system. While admirable, the situation risks creating a perfect storm for system interruptions if supply from weather-dependent renewable sources is unable keep-up with accelerating demand for electricity in the coming decades. GSEO’s aim is to ensure the UK electricity grid can meet growing demand and keep the lights on without resorting to excessive levels of harmful fossil fuels, as it becomes increasingly reliant on renewable power. These projects will provide a highly efficient, flexible source of power that can be called upon when needed, and at short notice, to plug any shortfall in power generation from wind or solar.”

Michael Avison, CEO of Landmark Power Holdings Ltd, project developer and operating partner of Victory Hill said: “We are delighted to be partnering with the very experienced Victory Hill Team on what is a very important program of projects. Our organisations share the same perspectives on the UK’s power markets. The Landmark Power Team have also benefitted from the support of Swedish company Climeon, to help design and optimize the UK’s first decarbonised gas fired power plants that are able to materially support the grid through the provision of both base load power as well as supplying the balancing and capacity markets. In addition, when combined with carbon capture and re-use technology, the footprint of the plant is effectively net zero carbon. This makes our plants highly efficient and carbon neutral in their own right”.

VH Global Sustainable Enrgy Opprtnts PLC

102.40 GBX

8 Sep, 4:35 pm GMT+1 ·Disclaimer

www.vh-gseo.com

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