Harmony Energy Income Trust has announced that it will undertake an initial public offering (IPO). The purpose of the IPO is to fund the battery energy storage company’s development of 213.5 MW (megawatts) of projects using Tesla’s Megapack battery storage technology, Solar Power Portal reports.
The company will use the IPO to fund a diversified portfolio of battery energy storage systems throughout Great Britain, with a focus on projects that are “shovel ready.” So far, there are five projects it plans to acquire with a total capacity of 213.5 MW and 427 MWh (megawatt-hours) from Harmony Energy Limited. The acquisition value is based on a fixed funding requirement of £750,000 per MW on acquisition.
Harmony will list on the Specialist Fund Segment of the Main Market of the London Stock Exchange through an institutional placing, the article noted. It will have an offer for subscription with up to 230 million new ordinary shares that will be subject to a five-year lock-up term. And it will be available at the initial issue of 100 pounds per share.
In addition to the above-mentioned portfolio, there’s also a 99MW/198MWh advanced project planned, which would bring the company’s total capacity capacity to 312MW/625MWh. But that’s not all! “The company will also have exclusive rights to acquire a pipeline of battery storage projects with an aggregate capacity of 687.5MW that is already within Harmony Energy’s control. Overall this would bring Harmony’s initial target portfolio to 1GW, it will also have preferential rights over Harmony Energy’s future projects.”
Harmony is targeting a dividend yield of 8% per annum and this will be payable quarterly starting in 2023. The article noted that Harmony has contracted with Tesla for the initial portfolio, and this includes agreed pricing and timing of delivery. Harmony specifically selected Tesla’s Megapack batteries for their long duration.
Norman Crighton, prospective chairman of Harmony Energy Income Trust, spoke about the need for the right infrastructure to secure Britain’s energy supplies. “The nation is becoming increasingly aware of the need to have the right infrastructure in place to secure our energy supplies,” he said. “As we increase our reliance on renewable power, battery storage will have a crucial role to play. The battery energy storage sector is one that has seen remarkable growth over the past 10 years; it will only grow further and the company will be at the forefront of this growth.”
Paul Mason, managing director of the Investment Advisor touched upon the importance of battery energy storage and its offer of exciting growth potential. He noted there’s an expected requirement of up to 43GW by 2050 from just 1.2GW now. “Investing in battery storage energy systems requires extensive sector expertise and knowledge, and our team has decades of investment and industry experience. Battery storage energy systems are a vital cog in the renewable energy value chain. We believe there is enormous potential in the sector and the 2-hour duration battery will be best placed to take advantage of this.”