Q2 2026 Gresham House Energy Storage Fund PLC Earnings Call

September 23, 2026

Speaker #1: You have joined the meeting as an attendee and will be muted throughout the meeting.

Rupert Robinson: On this morning's presentation. Numbers still ticking up, so just bear with us for a minute or two. Okay, I think we will get started. Good morning, everyone, and welcome to the interim results presentation for the Gresham House Energy Storage Fund, commonly known as GRID, for the six-month period ending 30 June 2026. As always on these results presentations, delighted to be joined by Ben Guest, the lead Fund Manager of GRID, and also accompanied this morning by Harry Hutchinson, a member of the investment team. Ben will present, together with Harry, for about 20 minutes, run through the presentation, and then we will open it up to Q&A. Please send through any questions that you have as we go through the presentation, and we will answer as many as we can in the time allotted. We will aim to complete the presentation and Q&A by 10:45 AM this morning.

Speaker #2: On this morning's presentation, the number is still ticking up—so just bear with us for a minute or two. Okay, I think we'll get started.

Speaker #2: Good morning, everyone, and welcome to the interim results presentation for the Gresham House Energy Storage Fund, commonly known as GRID, for the six-month period ending 30 June 2026.

Speaker #2: As always on these results presentations, I'm delighted to be joined by Ben Guest, the lead fund manager of GRID, and also accompanied this morning by Harry Hutchinson, a member of the investment team.

Speaker #2: Ben will present, together with Harry, for about 20 minutes. We'll run through the presentation, and then we'll open it up to Q&A. Please send through any questions that you have as we go through the presentation, and we'll answer as many as we can in the time allotted.

Speaker #2: We'll aim to complete the presentation and Q&A by 10:45 this morning. It's been an exceptionally busy period for the company in the first half of the year, with a strong uptick in NAV as new projects move into the construction phase, work done on augmentations, and also further progress on alternative revenues, etc.

Rupert Robinson: It has been exceptionally busy period for the company the H1 of the year. Strong uptick in NAV as new projects move into the construction phase, work done on augmentations and also further progress on alternative revenues, et cetera. On that note, I am going to hand over to Ben. He will go through the results in more detail, and then, as I say, we will open up to Q&A. So please send your questions in. Ben, over to you, sir.

Speaker #2: So, on that note, I'm going to hand over to Ben. He'll go through the results in more detail, and then, as I say, we'll open up to Q&A, so please send your questions in.

Speaker #2: Ben, over to you, sir.

Speaker #3: Thanks, Rupesh. Good morning, everyone. Pleased to be presenting the first half results for 2026. As always, please bear in mind our disclaimer slide. Just getting into the presentation right away.

Ben Guest: Thanks, Rupert. Good morning, everyone. Pleased to be presenting the H1 results for 2026. As always, please bear in mind our disclaimer slide. Just getting into the presentation right away. Just some highlights in our executive summary page here. A period of healthy growth, a lot of activity, summarized by an NAV per share growing by 15.8% to 131.3p. It is not an all-time high, but it is making its way back. We showed some good revenue growth, rising almost 10% to close to GBP 35 million, and EBITDA outpacing this at GBP 23.5 million. This is driven by, obviously, increased capacity, and various contracted agreements coming into full effect. And in particular, on the margin side, greater operational efficiencies, and I will go into that detail.

Speaker #3: Just some highlights in our executive summary page here: a period of healthy growth, a lot of activity, summarized by an NAV per share growing by 15.8% to 131.3p. It's not an all-time high, but it's making its way back.

Speaker #3: We showed some good revenue growth, rising almost 10% to close to £35 million, and EBITDA outpacing this at £23.5 million. This is driven by, obviously, increased capacity and various contracted agreements coming into full effect, and, in particular, on the margin side, a greater operational efficiency.

Speaker #3: And I'll go into that detail. Now, just to highlight—and I'll repeat it two or three times throughout the presentation—contracted revenues are really increasing as a percentage of the total, representing 61% of the total in the first half.

Ben Guest: Just to highlight, I will repeat it two or three times through the presentation, contracted revenues are really increasing as a percentage of the total, representing 61% of the total in the H1. Augmentations are well underway. We had 2 completed by the mid-year, and we will have probably all but 1 completed by the end of the year. We have added 152 MWh of battery capacity in the H1. On the new projects that are already now financed and in construction, we concluded a project-level project financing exercise. We raised equity against those projects at a premium to the carrying value of the project rights. The projects for completion are Cockenzie, Monet's Garden, and Elland 2, 240, 57, and 100 MW respectively.

Speaker #3: In terms of incremental activities, we're busy with our growth plan. Augmentations are well underway. We had two completed by mid-year, and we'll have probably all but one completed by the end of the year.

Speaker #3: We've added 152 megawatt-hours of battery capacity in the first half. On the new projects that are already now financed and in construction, we concluded a project-level project financing exercise.

Speaker #3: We raised equity against those projects at a premium to the carrying value of the project rights. The projects, for completeness, are Kenzie Monet's and LN2—240, 57, and 100 megawatts, respectively.

Speaker #3: And we and they're still on track to energize in the back half of 2027. With Monet's garden likely to come first. We've also looking ahead to the incremental part of our growth plan, made completed the conditional acquisition, not completed, made conditional acquisition, signed SPAs for 777 megawatts of additional projects.

Ben Guest: They are still on track to energize in the back half of 2027, with Monet's Garden likely to come first. We have also, looking ahead to the incremental part of our growth plan, made conditional acquisition, signed SPAs for 777 MW of additional projects. That is Lister Drive, Ocker Hill, and Rayleigh. Again, 57, 240, and 480 MW respectively. We are working hard to make these projects a reality in various different ways. The Rayleigh project is still waiting for its NESO Gate 2 offer to come back. It is still within the time frames expected, so there is no disappointment there at this stage. We would look forward to seeing it as soon as possible, and hopefully, as soon as possible in Q1 of next year. Separate to that, Ocker Hill, one of our incremental projects for groundbreaking next year, which is a 240 MW project.

Speaker #3: That's Listed Drive, Okahill, and Rayleigh—again, 57, 240, and 480 megawatts, respectively. And we're working hard to make these projects a reality in various different ways.

Speaker #3: The Rayleigh project is still waiting for its meso gate to offer, to come back. It's still within the timeframes expected, so there's no disappointment there at this stage.

Speaker #3: But we would look forward to seeing it as soon as possible, and hopefully as soon as possible in Q1 of next year. Separate to that, Okahill—one of our incremental projects for groundbreaking next year—which is a 240-megawatt project, we designed the project to also be capable of being 145 megawatts, so derated, at an eight-hour duration, given the space limitations on the site.

Ben Guest: We designed the project to also be capable of being 145 MW, so derated at an 8-hour duration given the space limitations on the site. It has been awarded what they call a minded to contract by Ofgem. In other words, they intend to, I suppose, to give us a contract, and we then have to decide whether we accept the contract. There is quite a lot to think about in this context, and quite a lot we do not know yet. Hopefully, we will know in the next couple of months. In terms of other highlights, we have mentioned the NAV per share rising. You can see the last 3 half-yearly periods, with a good trend emerging there.

Speaker #3: And it has been awarded what they call a 'minded to contract' by Ofgem. In other words, they intend, I suppose, to give us a contract, and we then have to decide whether we accept the contract.

Speaker #3: There's quite a lot to think about in this context, and quite a lot we don't know yet. But hopefully, we will know more in the next couple of months.

Speaker #3: In terms of other highlights, we've mentioned the NAV per share rising. You can see the last three half-yearly periods show a good trend emerging there.

Speaker #3: And hopefully, as we build new projects and/or get into construction on new projects over the next year or so, we'll see the incremental megawatts that I talked about—the close to 800 megawatts—impacting NAV per share in a similar way, proportionately speaking.

Ben Guest: Hopefully, as we build new projects, or get into construction on new projects over the next year or so, we will see the incremental megawatts that I talked about, the close to 800 MW impacting NAV per share in a similar way, proportionately speaking. Operational capacity is at a record high, 1,072 MW, nearly 1.9 GWh or 1,853 MWh. Again, you can see the trend there. Megawatts have not increased this half year, but will do as the new projects start commissioning. Obviously, the augmentations are showing up in the MWh figure. Net debt and net debt to NAV remain within healthy limits. It has risen to GBP 171 million, the net debt. The net debt to NAV has actually declined slightly this half year as the NAV come up. On the revenue perspective, growing and look forward to it growing further.

Speaker #3: Operational capacities are at a record high: 1,072 megawatts, nearly 1.9 gigawatt-hours, or 1,853 megawatt-hours. Again, you can see the trend there—megawatts haven't increased this half-year, but will do as the new projects start commissioning.

Speaker #3: But obviously, the augmentations are showing up in the megawatt-hour figure. Net debt and net debt to NAV remain within healthy limits. So it's risen to £171 million, the net debt.

Speaker #3: And the net debt to NAV has actually declined slightly this half-year, as the NAV has gone up. On the revenue perspective, we are growing and look forward to it growing further.

Ben Guest: The growth, as I mentioned, was driven by its general increase in underlying capacity. It has not been driven this H1 by underlying improvements in revenue rates. Indeed, revenue rates have been hampered by assets being offline for augmentation. Glassenbury and Stairfoot, in particular, making up 90 MW, were offline for quite a long period. Also, we have seen DNO outages this summer in Q2, basically. An outage is basically there to either carry out scheduled maintenance or meaningful network upgrades which require outages on our sites. So we have seen more of that this year than previously, and that has had an impact as well. The next tile across is the contracted revenue. I have talked to that already. It is a significant percentage, and I will give some more color in a little bit. Then in terms of EBITDA margin, this is our best margin for some time.

Speaker #3: The growth, as I mentioned, was driven by its general increase in underlying capacity. It has not been driven this half-year by underlying improvements in revenue rates.

Speaker #3: Indeed, revenue rates have been hampered by assets being offline for augmentation. Glastonbury and Stairford, in particular, are making up 90 megawatts. We're offline for quite a long period.

Speaker #3: Also, we've seen DNO outages this summer—in the second quarter, basically. Outages are there to either carry out scheduled maintenance or meaningful network upgrades, which require outages on our sites.

Speaker #3: So we've seen more of that this year than previously, and that's had an impact as well. The next tile across is the contracted revenue.

Speaker #3: I've talked about it already. It's a significant percentage, and I'll give some more color in a little bit. And then, in terms of EBITDA margin, this is our best margin for some time.

Ben Guest: We do look forward to seeing further uplifts as we see more assets online. Naturally, a project that is offline has a zero to negative EBITDA margin for that period. So there is scope to hopefully see improvements in that respect, as well as our endless focus on extracting costs, which we are seeing some success in as well. Just in more words, a bit more of what we have done. So we have added 152 MW in augmentations in H1. We have got two augmentations that were completed in September, adding a further 54, and we have got two more targeting completion in October, adding a further 60. That will probably leave just Kirkenside's augmentation to complete in the new year. In terms of new projects, as we mentioned, we have reached financial close and got into construction on Cockenzie, Elland 2, and Monet's Garden, totaling nearly 400 MW and targeting energization.

Speaker #3: We do look forward to seeing further uplifts as we see more assets online. Naturally, a project that's offline has a zero to negative EBITDA margin for that period.

Speaker #3: So there's scope to hopefully see improvements in that respect, as well as our ongoing focus on extracting costs, which we're seeing some success in as well.

Speaker #3: Just to add a bit more detail on what we've done: we’ve added 152 megawatts in augmentations in the first half. We had two augmentations that were completed in September, adding a further 54 megawatts.

Speaker #3: And we've got two more targeting completion in October, adding a further 60. That will probably leave just third cross augmentation to complete in the new year.

Speaker #3: In terms of new projects, as we mentioned, we've reached financial close and gone into construction on Kenzie LM2 and Monet's Garden, totaling nearly 400 megawatts.

Speaker #3: And we're targeting energization—in other words, connection to the grid—in the second half of 2027. In terms of the next three projects, which are larger, approaching twice the capacity of the current projects under construction, we're excited about these.

Ben Guest: In other words, a connection to the grid in H2 2027. In terms of the next three projects, which are larger, approaching twice the capacity of the current projects under construction. We are excited about these. They are all in England. They benefit from various network needs and therefore benefits from a cost perspective, negative network charges, for example. The TNUOS charges are negative on the larger two of these two projects. We are into design, thinking hard about whether to make them long duration and if longer duration than in the past, which they will be. Almost certainly, it is a question of how many hours against the megawatts? How long can they charge and discharge for? As I have mentioned, I have mentioned the long duration minded to contract.

Speaker #3: They're all in England. They benefit from various network needs and therefore benefit from a cost perspective. Negative network charges, for example, the TNUoS charges.

Speaker #3: Are negative on the larger two of these two projects. And we're into design, thinking hard about whether to make them long duration and if longer duration than in the past, which they will be.

Speaker #3: Almost certainly, it's a question of how many hours against the megawatts—how long can they charge and discharge for. As I've mentioned, I've mentioned the long-duration minded to contracts.

Speaker #3: As I mentioned, there's still a lot that we don't know yet in terms of how we'll be expected to operate them, and what impact that will have, positively or negatively, on both technical degradation and, obviously, revenue levels.

Ben Guest: As I mentioned also, there is a lot that we do not know yet in terms of how we will be expected to operate them, and what impact that would have, positively or negatively, on both technical degradation and obviously revenue levels. Just to highlight in H1 also that, and we have said this a few times, but useful to highlight again, that we struck a partnership with Summit Transition Partners, which is made up of Sumitomo and TPK in Taiwan. We are excited about this relationship and doing more on our incremental projects with them. In terms of alternative revenues, I have not mentioned anything yet. The trials that were started in December of last year concluded in H1. We expect these revenues to add to and complement our existing revenue stack. I will come onto that in a little bit.

Speaker #3: Just to highlight in the first half also, and we've said this a few times, but it's useful to highlight again, that we struck a partnership with Summit Transition Partners, which is made up of Sumitomo and TPK in Taiwan.

Speaker #3: We're excited about this relationship and are looking forward to doing more on our incremental projects with them. In terms of alternative revenues, I haven't mentioned anything yet. The trials that were started in December of last year concluded in the first half; we expect these revenues to add to and complement our existing revenue stack.

Speaker #3: I'll come onto that in a little bit. And in terms of getting going, there's a lot of activity in the background—really sort of honing and optimizing. And as part of that, in the first half, we signed a route-to-market contract with a particular counterparty that enables us to do this at scale.

Ben Guest: And in terms of getting going, there is a lot of activity in the background, really sort of honing and optimizing. As part of that, in H1, we signed a route to market contract with a particular counterparty that enables us to do this at scale. Just to highlight also that alternative revenues are not included in valuations or in the NAV today at all. Hopefully we can start to show some movement there as well from a valuation perspective, as well as EBITDA. Just to sort of highlight what we did in H1 on the new projects. We closed a relatively complex financing across the 3 projects. Bearing in mind that we cannot raise capital at the top co, given discounts to NAV, a feature of investment trust companies' listing rules.

Speaker #3: And just to highlight, alternative revenues are not included in valuations or in the NAV today at all. So hopefully we can start to show some movement there as well, from a valuation perspective as well as EBITDA.

Speaker #3: Just to sort of highlight what we did in the first half on the new projects, we closed a relatively complex financing across the three projects.

Speaker #3: Bearing in mind that we can't raise capital at the topco, given discounts to NAV—a feature of investment trust companies' listing rules—so we raised senior debt of £141 million, representing about 70% of the construction cost.

Ben Guest: We raised senior debts of GBP 141 million, representing about 70% of the construction cost. We added some more debt on Kirkenside and Monet's Garden, not Elland 2, to the tune of GBP 30 million in the form of an export credit facility, which was competitively priced. Just to say that having done all this work, and put a process in place, this funding structure is absolutely repeatable. It is likely to be at the margin different in certain ways, as we continue to seek to improve the way we do things. But it does lay the groundwork, and there will be a lot of similarities, I expect, between the current financing and future funding. This is all despite equity markets being closed. We are always pleased to be able to grow despite that.

Speaker #3: We added some more debt on Kenzie and Monet's garden, not LM2, to the tune of $30 million in the form of an export credit facility.

Speaker #3: Which was competitively priced. And then, just to say that, having done all this work and put a process in place, this funding structure is absolutely repeatable.

Speaker #3: It's likely to be marginally different in certain ways, as we continue to seek to improve the way we do things. But it does lay the groundwork, and there will be a lot of similarities, I expect, between the current financing and future funding.

Speaker #3: And this is all despite equity markets being closed. We're always pleased to be able to grow despite that. Just on alternative revenues, we used a similar slide in our Capital Markets Day, which we had in May, at which time we presented an iteration to our then-called three-year plan.

Ben Guest: Just on alternative revenues, we used a similar slide at our capital markets day, which we had in May, at which time we presented an iteration to our then-called 3-year plan. We are now calling it our growth plan. That growth plan is iterated to basically allocate capital more efficiently to focus on more new capacity growth and less augmentation, because that was just more straightforward from an equity funding perspective and equity requirement. We said more about alternative revenues, which I will speak to now. These alternative revenues essentially add to our revenue stack and therefore diversify our revenue base. They are naturally inversely correlated to the merchant revenues that are generated by our core utility scale fleet, which obviously do better in high volatility environments. Obviously alternative revenues do worse in high volatility environments. So there is a natural layering in of 2 sets of revenue streams.

Speaker #3: We're now calling it our growth plan. That growth plan was iterated to basically allocate capital more efficiently, to focus on more new capacity growth and less augmentations.

Speaker #3: Because that was just more straightforward from an equity funding perspective, and equity requirements. And we said more about alternative revenues, which I'll speak to now.

Speaker #3: These alternative revenues essentially add to our revenue stack, and therefore diversify our revenue base. They are naturally inversely correlated to the merchant revenues that are generated by our core utility-scale fleet.

Speaker #3: Which obviously do better in high volatility environments. So, obviously, in terms of revenues, they do worse in high volatility environments. So, there's a natural layering in of two sets of revenue streams.

Speaker #3: And to be honest, we won’t mind how they outturn. We just like that, in combination, they should contribute to lower volatility and revenues—and to more revenues, of course, and more revenues per megawatt.

Ben Guest: To be honest, we will not mind how they outturn. We just like that in combination, they should contribute to lower volatility in revenues and to more revenues, of course, and more revenues per megawatt. We spent a lot of time back-testing this using historical data and backcasting and obviously live trials as well. The most recent one ending in March of this year. At the bottom of the slide, you have got a timeline, a simple timeline showing what we did in the trial, what we are targeting by year end, which hopefully will grow past during next year. Of course, we are still committed to our GBP 25 million EBITDA target for this area as part of our growth plan. I like this slide a lot, especially in terms of the story it tells.

Speaker #3: We spent a lot of time back-testing this using historical data and back-casting, and obviously live trials as well—the most recent one ending in March of this year.

Speaker #3: And at the bottom of the slide, you've got a timeline—a simple timeline showing what we did in the trial, what we're targeting by year-end, which hopefully will grow past that during next year.

Speaker #3: And of course, we're still committed to our £25 million EBITDA target for this area as part of our growth plan. I like this slide a lot.

Speaker #3: Especially in terms of the story it tells. Obviously, the pie charts or the donuts don't show the growth, as stated there, as 10% or 9.5% to be more accurate.

Ben Guest: Obviously, the pie charts or the donuts do not show the growth that is stated there as 10% or 9.5% to be more accurate. But what it does show is if you look at the inner circles or inner donuts, you can see that the contracted share of revenues as opposed to merchant has grown significantly. This is a function of the tolls that we had in place initially and those rolling off into a greater proportion of the portfolio in terms of floor contracts. We have still got quite a few to roll onto. So, the contracted revenue base is looking healthy, which is what the aim when we carried out our debt refinancing last year, ahead of the financing that I have mentioned already on the new projects this year. This all speaks to our existing portfolio.

Speaker #3: But what it does show is, if you look at the inner circles or in the donuts, you can see that the contracted share of revenues, as opposed to merchant, has grown significantly.

Speaker #3: And this is a function of the tolls that we had in place initially, and those rolling off into a greater proportion of the portfolio in terms of floor contracts.

Speaker #3: And we've still got quite a few to roll onto. So the contracted revenue base is looking healthy, which was the aim when we carried out our debt refinancing last year.

Speaker #3: Ahead of the financing that I've mentioned already on the new projects this year—so this all speaks to our existing portfolio. Within the contracted revenue base, we see capacity markets generating a higher percentage of revenues.

Ben Guest: Within the contracted revenue base, we see capacity markets generating a higher percentage of revenues, partly as capacity market contracts roll on, partly, and it is small part, relatively speaking, due to inflation every year at the contract start date anniversary, which is October, capacity market contracts reprice upwards with CPI. The tolling is still there, but that will start rolling off and be replaced by floor contracts, and then exceeded by, and it will all become floor contracts in due course. When you look at the merchant piece, I think what is useful to look at there is what we have been talking about for a long time. If you look at H1 of last year, trading was over 50% of total merchant revenues. But frequency response, broadly categorized as an ancillary service, was still a meaningful part in H1 of this year.

Speaker #3: Partly as capacity market contracts roll on, partly a small part, relatively speaking. Due to inflation every year at the contract start date—and anniversary, which is October—capacity market contracts reprice upwards with CPI.

Speaker #3: And then the tolling is still there, but that will start rolling off and be replaced by floor contracts, and then exceeded by—and will become floor contracts in due course.

Speaker #3: Then when you look at the merchant piece, I think what's useful to look at there is what we've been talking about for a long time.

Speaker #3: If you look at the first half of last year, trading was over 50% of total merchant revenues. But frequency response is broadly categorized as an ancillary service.

Speaker #3: We're still a meaningful part in the first half of this year. Trading really is starting to take over as the main business of the company.

Ben Guest: Trading really is starting to take over as the main business of the company. Trading is essentially trading volumes of energy, whether through the wholesale market or making ourselves available to the control room, as opposed to responding to very short-term signals, variations in the frequency, precisely speaking, that trigger the import or export of power that cannot be traded because it is too live, too real time. It is naturally a smaller part of the market. This next slide goes through the NAV per share. We are very pleased with this outcome. Naturally, this eventually translates into EBITDA growth. The NAV at the end of last year was 113.3. The roll-forward effect is a combination of shorter lives on some projects, although others have long lives. But we do cap everything at 30 years, even if we own the land.

Speaker #3: Trading is essentially trading volumes of energy, whether through the wholesale market or making ourselves available to the control room, as opposed to responding to very short-term signals—variations in the frequency, precisely speaking.

Speaker #3: That triggers the import or export of power that can't be traded because it's too live to real-time. And it's naturally a smaller part of the market.

Speaker #3: This next slide goes through the NAV per share. We're very pleased with this outcome. Naturally, this eventually translates into EBITDA growth. The NAV at the end of last year was £113.3.

Speaker #3: The roll-forward effect is a combination of shorter lives on some projects, although others have long lives. But we do cap everything at 30 years, even if we own the land.

Speaker #3: But then naturally, if products are getting shorter, that would mean a negative roll-forward effect. But two other things take it positive. We've got certain fallow periods.

Ben Guest: Naturally, if a project are getting shorter, that would mean a negative roll-forward effect. But two other things take it positive. We have got certain fallow periods, for example, assumed for augmentations starting to disappear. Naturally, because we have got upward-leaning revenue curve forecasts, you are heading towards that higher ground, at least from a NAV perspective, and it has a small effect to the positive. The next bar is much more meaningful. It is the revaluation of our incremental projects to fair value. The three projects that I mentioned are Kirkenside, Monet's Garden, and Elland 2. These are now valued on a DCF basis and having IRRs in excess of the weighted average discount rate. Given the fact that there is a lot of megawatts involved here, and there will be just a highlight even more next year with the next phase of projects, it has a big effect on the NAV.

Speaker #3: For example, let's assume augmentations are starting to disappear. And naturally, because we've got an upward-leaning revenue curve, forecasts show you're heading towards higher ground, at least from a NAV perspective, and it has a small positive effect.

Speaker #3: The next bar is much more meaningful. It's the revaluation of our incremental projects to fair value. The three projects that I mentioned are Kenzie, Monet's, and LM2.

Speaker #3: These are now valued on a DCF basis, and have IRRs in excess of the weighted average discount rate. And given the fact that there's a lot of megawatts involved here, this will be highlighted even more next year.

Speaker #3: With the next phase of projects, it has a big effect on the NAV. Other updates are relatively small, from construction costs and other things.

Ben Guest: Other updates are relatively small from construction costs and other things, and timings as well as another factor within the construction update. Revenue forecasts, small overall impact in terms of how we have done this. We will come onto that in a second. Operating costs, net fund and SPV working capital is essentially cash flow from the projects. Operational debt costs are the debt servicing within the portfolio. Then you have a mark to market on the interest rate swaps leading to GBP 131.3. Speaking to the curves now, here you have a typical chart that we have used many times before of the 1 hour in light blue or teal. Yellow is an hour and a half. 2 hours is the dark blue. What we have done this period, and it is important to share, is the dashed line is the previous period. In other words, the end of 2025 curve.

Speaker #3: And timings, as well as another factor within the construction update. Revenue forecasts show a small overall impact in terms of how we've done this. We'll come into that in a second.

Speaker #3: And operating costs, net fund, and SPV working capital is essentially cash flow from the projects. Operational debt costs are the debt servicing within the portfolio.

Speaker #3: And then you've got a market to market on the interest rate swaps leading to a 131.3. Speaking to the curves now, we've got here you've got a typical chart that we've used many times before of the one hour in light blue or teal.

Speaker #3: Yellow is an hour and a half, and two hours is the dark blue. What we've done this period, and it's important to share, is the dashed line is the previous period.

Speaker #3: In other words, the end of the 2025 curve. Most of the solid line is the new forecast, which, over the longer term, has headed higher.

Ben Guest: Most of the solid line is the new forecast, which over the longer term has headed higher. The actual forecast that we received were the small dotted lines between now and 2030. The manager with the board and its advisors have decided to reset that front end, which would have, if taken on board, led to a significantly higher increase in NAV this period. Set the curve at the front end to essentially be a relatively straight line between current trading environment and 2030s third-party curve level. It is effectively interpolated between the two. The rationale for that is it makes little sense to assume third-party curves at the levels shown when actual trading is at the levels where we have reset them. Then, for want of a better or more scientific approach, we have interpolated between the two.

Speaker #3: And the actual forecasts that we received were the small dotted lines between now and 2030. The manager, with the board and its advisors, has decided to reset that front end, which would have, if taken on board, led to a significantly higher increase in NAV this period.

Speaker #3: And set the curve at the front end to essentially be a relatively straight line between the current trading environment and the 2030s—third-party curve level—and effectively interpolated between the two.

Speaker #3: The rationale for that is, it makes little sense to assume third-party curves at the levels shown, when actual trading is at the levels where we've reset them.

Speaker #3: And then, for want of a better or more scientific approach, we've interpolated between the two. And we assume 2030 simply because we thought that was a sensible timeframe to see essentially the underlying causes for these curves to be essentially over-optimistic, in our opinion—namely, skips having a chance to come down certainly by 2030.

Ben Guest: We assume 2030 simply because we thought that was a sensible timeframe to see essentially the underlying causes for these curves to be essentially over-optimistic in our opinion, namely SCIPS, having a chance to come down certainly by 2030. The final point on this slide onto the right here is that the weighted average discount rate remains at a similar level to the past, which is 10.9%. Before going into conclusions, this is a sort of a market slide. We continue to be somewhere in the teens at 14% of the market. It is a rapidly evolving market, but not explosively. We are still the largest. Zenobē and Statera, if you have studied these charts before, have been there for a long time. A new entrant has been Copenhagen Infrastructure Partners with a meaningful new project at 500 MW.

Speaker #3: And then the final point on this slide, on the right here, is that the weighted average discount rate remains at a similar level to the past, which is 10.9%.

Speaker #3: Before going into conclusions, this is sort of a market slide. We continue to be somewhere in the teens—14% of the market. It's a rapidly evolving market, but not explosively.

Speaker #3: We're still the largest Zenobian Stateria. If you study these charts, we've been there for a long time. A new entrant has been Copenhagen Infrastructure Partners, with a meaningful new project at 500 megawatts.

Speaker #3: VoltWise, which bought SMS PLC's assets and is growing itself, is shown there as well. And you've got Foresight here, who acquired Harmony's assets. It's still a relatively small field.

Ben Guest: Voltwise, which bought Smart Metering Systems plc's assets and is growing itself, is shown there as well. You have Foresight here, who acquired Harmony's assets. It is still a relatively small field, I think is a key point to highlight. There will be one or two emerging players, in particular, Fidra Energy is building a large project at Thorpe Marsh and another one as well. They are expected to be a large operator. They are backed by EIG and the National Wealth Fund. Other than that, it is pretty small overall playing field in the UK by number. In terms of highlights, driving value from our operational base is a key focus. Between financings, we have more time to do this. We are obviously growing our team as well.

Speaker #3: I think it's a key point to highlight. There will be one or two emerging players in particular. Fidra Energy is building a large project at Fort Marsh and another one as well.

Speaker #3: They are expected to be a large operator. They're backed by ENG and the National Wealth Fund. But other than that, it's a pretty small overall playing field in the UK.

Speaker #3: By number. And then since there's a highlight, driving value from our operational base is a key focus. And between financings, we have more time to do this.

Speaker #3: We're obviously growing our team as well, and we're finding ways of incrementally adding revenues or incrementally taking cost out. We look forward to reporting more on that at the next stage.

Ben Guest: And we are finding ways of incrementally adding revenues or incrementally taking cost out. We look forward to reporting more on that at the next stage. Whether it is at Q3 or full year remains to be seen, but we are excited about how much cost we can take out of the business by doing things in innovative ways. Again, more details on that in the future. The following bullets are mainly about the growth plan, augmentations, adding 198 MWh of capacity. We are heading towards 2 hours very quickly. We are at just under 1.8 hours now. It is nice to see that. It has a positive impact on revenues. We are under construction on the incremental 3 projects, nearly 400 MW, with energization in the back half of next year.

Speaker #3: Whether it’s at Q3 or full year remains to be seen, but we’re excited about how much cost we can take out of the business by doing things in innovative ways.

Speaker #3: Again, more details on that in the future. The following bullets are mainly about the growth plan—augmentations, adding 198 megawatt-hours of capacity. We're heading towards two hours very quickly.

Speaker #3: We're at just under 1.8 hours now. It's nice to see that—it has a positive impact on revenues. We're on the construction of the incremental three projects, nearly 400 megawatts, with energization in the back half of next year.

Speaker #3: We're progressing well on the development and moving towards construction readiness on the incremental 777 megawatts, even though we are still waiting for the Rayleigh grid connection offer to come back.

Ben Guest: We are progressing well on the development and progressing to construction readiness on the incremental 777 MW, even if we are still waiting for the Rayleigh grid connection offer to come back. We are evaluating design and in particular duration very closely. There is a lot of new battery offerings to serve that part of the market now and emerging as well, which is very interesting to look at. Then scaling up alternative revenues. We remain very excited about this area. We are honing our strategy, and look forward to providing further updates with an initial step of 20 MW by the end of this year in terms of what we are reporting and committing to. That is it. With that, I will go back to Rupert. Thank you.

Speaker #3: And we're evaluating design, and in particular, duration, very closely. There are a lot of new battery offerings to serve that part of the market now emerging as well, which is very interesting to look at.

Speaker #3: And then, scaling up alternative revenues—we remain very excited about this area. We're honing our strategy and look forward to providing further updates, with an initial step of 20 megawatts by the end of this year in terms of what we're reporting and committing to.

Speaker #3: That's it with that. I'll go back to Rupert. Thank you.

Speaker #1: Ben, thank you. Informative as always. Again, if any of the audience would like to ask a question, please send those in online. We have three or four here, so we can kick off while others want to add to the list.

Rupert Robinson: Ben, thank you. Informative, as always. Again, if any of the audience would like to ask a question, please send those in online. We have 3 or 4 here, so we can kick off while others want to add to the list. Ben, first question, are you seeing any changes in battery technology coming to sufficient maturity that you would start to consider them for the company?

Speaker #1: Ben, first question. Are you seeing any changes in battery technology coming to sufficient maturity that you'd start to consider them for the company?

Speaker #2: Starting to. And the only one we're starting to see is sodium-ion. The technology has various benefits and various drawbacks today. It's still more expensive than lithium-ion, so we're very unlikely to buy it.

Ben Guest: Starting to. The only one we are starting to see is sodium-ion. The technology has various benefits and various drawbacks. Today, it is still more expensive than lithium-ion, so we are very unlikely to buy it. It has also less density, so it takes up more room. On the flip side, it considers and is safer. The likelihood of thermal runaway is smaller. Sodium is more abundant, so the likelihood that once it gets and competes with lithium successfully, is that the bill of materials there will end up lower and may completely take over in due course. It is easier to measure its state of charge, so you can use the battery more fully. It does not go to degradation necessarily, but it goes to potentially revenues, and a few other features. Again, sodium-ion is the only one that is being heavily backed also by the Chinese manufacturers.

Speaker #2: It also has less density, so it takes up more room. On the flip side, it's considered safer, as the likelihood of thermal runaway is smaller.

Speaker #2: Sodium is more abundant, and so the likelihood is that once it gets in and competes with lithium successfully, the bill of materials there will end up lower, and it may completely take over in due course.

Speaker #2: It's easier to measure its state of charge, so that you can use the battery more fully. It doesn't go to degradation necessarily, but it goes to potentially revenues.

Speaker #2: And under a few other features. So yeah, the sodium-ion is the only one that is being heavily backed, also by the Chinese manufacturers as well.

Speaker #2: CATL have announced a product in this area, so I would expect a big push from the manufacturers, and it would be interesting to see the world not dependent on lithium for stationary batteries.

Ben Guest: CATL have announced a product in this area, so I would expect a big push from the manufacturers in this area, and it would be interesting to see the world not dependent on lithium for stationary batteries. I suspect the density is not good enough for car batteries, although you may see hybrid batteries, because sodium also operates well at a wider temperature range. So that could be good for many uses.

Speaker #2: I suspect the density is not good enough for car batteries, although you may see hybrid batteries, because sodium also operates well at a wider temperature range as well.

Speaker #2: So, that could be good for many uses.

Speaker #1: Thank you. Trading revenue in H1 2026 was lower than the same period last year. Can you comment on the reasons? The wholesale electricity price was negative on eight occasions in September to date, while high on average overall.

Rupert Robinson: Thank you. Trading revenue in H1 2026 were lower than the same period last year. Can you comment on reasons? The wholesale electricity price was negative on 8 occasions in September to date, while high on average overall. How has this impact recent trading?

Speaker #1: How has this impacted recent trading?

Speaker #2: So, first half trading and recent trading. The first half was generally flatter. We saw an uptick in skip rates for batteries. I'll come on to that in a second.

Ben Guest: First half trading and recent trading.

Rupert Robinson: Yeah.

Ben Guest: The first half was generally flatter. We saw an uptick in skip rates for batteries. I will come onto that in a second. So slightly flatter markets or flatter markets at certain times. There were certain months that were pretty volatile, but overall, there were some also weaker months. So overall, market conditions were a bit tougher. But within our portfolio, what has really impacted things is uptime. So as I mentioned, our Glassenbury project, which was 50 MW, was off and not really generating until well into Q2. We had Stairfoot, which was off, I cannot remember exactly how long, but 2 to 3 months. That is 40 MW, basically 4% of the portfolio. We did have one other asset that was offline for technical reasons, for which we have made a business interruption insurance claim, and that gap will probably be filled in with that.

Speaker #2: So, slightly flatter markets, or flatter markets at certain times. I mean, there were certain months that were pretty volatile, but overall, there were also some weaker months.

Speaker #2: So overall, market conditions were a bit tougher. But within our portfolio, what's really impacted things is uptime. So as I mentioned, our glassing project, Glastonbury project, which was 50 megawatts, was off and not really generating until well into Q2.

Speaker #2: We had Stairfoot, which was off—I can't remember exactly how long—but two to three months. That's 40 megawatts, basically 4% of the portfolio.

Speaker #2: We did have one other asset that was offline for technical reasons, for which we've made a business interruption insurance claim. And that gap will probably be filled in with that.

Speaker #2: It was not our site that was at issue; it was the network. So, there's a handful of factors that led to lower uptime as well.

Ben Guest: It was not our site that was at issue, it was the network. There is a handful of factors that led to lower uptime as well. The last factor being DNO outages. We are connected to Distribution Network Operators, or DNOs for short, across our current fleet. They need to sometimes do, and usually just during the better months of the year, tend to take assets offline, like ours, which they are allowed to do to either reinforce the network or do scheduled maintenance. We saw quite a lot of that this year. There is that. In terms of the skip rate point, it impacted in particular in Q2 and into Q3 a bit.

Speaker #2: The last factor being DNO outages. So we're connected to distribution network operators or DNOs for short across our current fleet. And they need to sometimes do and usually during the better months of the year tend to take assets offline like ours, which they allowed to do to either reinforce the network or do schedule maintenance.

Speaker #2: And that's—we saw quite a lot of that this year, so there's that. Then, in terms of the skip rate point, it impacted in particular in Q2 and into Q3 a bit.

Speaker #2: The very hot months that we've seen has led to some press on this as well, but the control room needing to be more cautious about how extreme certain scenarios might how extreme scenarios might be in any half-hourly period.

Ben Guest: The very hot months that we have seen has led to some press on this as well, but the control room needing to be more cautious about how extreme certain scenarios might be in any half-hourly periods. In other words, might we see certain gas plants go offline suddenly? Might we see even nuclear plants go offline in 40 degrees Celsius heat, et cetera. You have got a sort of unknown decreases in behind the meter generation because of the 2 million rooftops we have got in this country, which keeps going up. We have got EV charging profiles starting to make a dent in terms of what happens on the network. The general caution was introduced in the control room, and that means that they need more of the flex that is available to them.

Speaker #2: In other words, might we see certain gas plants go offline suddenly? Might we see even nuclear plants go offline in 40-degree heat, etc., etc.?

Speaker #2: You've got a sort of unknown decrease in behind-the-meter generation because of the two million rooftops we've got in this country, which keeps going up.

Speaker #2: We've got EV charging profiles starting to make a dent in terms of what happens on the network, and so the general caution was introduced in the control room.

Speaker #2: And that means that they need more of the flex that's available to them. That's made up of batteries, pumped storage hydro, gas, and, at the margin, even generating assets like the Drax's biomass asset.

Ben Guest: That is made up of batteries, pumped storage, hydro, gas, and at the margin, even generating assets like the Drax biomass asset. The ones that need scheduling soonest, for whatever reason, even if they are more expensive, are basically use them or lose them technologies. They are basically either you use them or you then do not have them available to you. In a more cautious environment, you have more of those used, and the outcome might still not be that bad, but you have dealt with or you mitigated a potential situation. It does mean that the batteries are forced to compete in a reduced pot because privileged access in that context has been given to the less efficient technologies. That is the core of the skip rate issue, and it is made worse when risk management and caution increases in the control room.

Speaker #2: And the ones that need scheduling soonest, for whatever reason—even if they're more expensive—are basically "use it or lose it" technologies. They're basically either you use them or you then don't have them available to you.

Speaker #2: And in a more cautious environment, you have more of those used, and the outturn might still not be that bad, but you've mitigated the potential situation.

Speaker #2: But it does mean that the batteries are forced to compete in a reduced pot, because privileged access in that context has been given to the less efficient technologies.

Speaker #2: That is the core of the skip rate issue, and it's made worse when risk management and caution increase in the control room. This is where the argument lies around how high skips should be.

Ben Guest: This is where the argument lies around how high skips should be. Over the next few years, we will see, we do expect anyway, given that half the gas fleet is over 30 years old, 15 over 30 gigawatts approximately. We do expect them to either be offline a lot more or just go offline permanently at end of life, and batteries will increase. Naturally, the skip rate issue should start diminishing as the overall mix of flexible assets just tends towards being more batteries. This is a big factor and one of the factors why trading revenues were weaker in H1.

Speaker #2: Over the next few years, we do expect, given that half the gas fleet is over 30 years old—about 15, over 30 gigawatts, approximately.

Speaker #2: We do expect them to either be offline a lot more or just go offline permanently at the end of life. And battery costs will increase.

Speaker #2: So naturally, the skip rate issue should start diminishing as the overall mix of flexible assets just tends towards being more batteries. But this is a big factor, and one of the reasons why trading revenues were weaker in the first half.

Speaker #1: Thank you, Ben. Any updates on NISO control room?

Rupert Robinson: Thank you, Ben. Any updates on NESO control room?

Speaker #2: Yes, there's always a dialogue going on. So, I've just spoken to the risk management point and the need to address sort of relative extreme situations, and taking a sort of mid-winter approach to managing the network in the middle of the summer, essentially.

Ben Guest: Yes. There's always a dialogue going on. I've just spoken to the risk management point and the need to address sort of relative extreme situations and taking a sort of midwinter approach to managing the network, in the middle of the summer, essentially. That's one thing. But probably the most incrementally significant one, specifically for batteries, is what we've called before, GC0166. That's the sort of group code modification that was consulted on for years. In the end, it was much slower than expected, but was approved by Ofgem in September of last year. We'd hoped that this would result in batteries becoming fully visible to the control room, by the middle of this year at the latest. That's been pushed back to early November.

Speaker #2: So that's one thing. But probably the most incrementally significant one, specifically for batteries, is what we've called the "Four GC0166." That's the sort of grid code modification that was consulted on for years, in the end.

Speaker #2: It's much slower than expected, but was approved by Ofgem in September of last year. We'd hoped that this would result in batteries becoming fully visible to the control room by the middle of this year, at the latest.

Speaker #2: That's been pushed back to early November. Simply to make sure that the information that needs to be provided to NISO both the type and how frequently it needs to be provided is on plugged in and basically on board with all the assets, all the many over 100 battery assets that exist across the country are correctly onboarded onto the balancing mechanism system which requires Alexon, which is the clearinghouse subsidiary of NISO.

Ben Guest: Simply to make sure that the information that needs to be provided to NESO, both the type and how frequently it needs to be provided is on, plugged in and basically onboarded all the assets. All the many over 100 battery assets that exist across the country are correctly onboarded onto the balancing mechanism system, which requires Elexon, which is the clearing house subsidiary of NESO. That when it does come online, we do hope will have a meaningful impact because in those instances where NESO has to say, "Well, we need as much flex as possible or allow for more flex because we don't know what the extreme environment might be," because of the reasons I gave earlier, but outages of generation plants is the big one.

Speaker #2: When it does come online, we do hope we'll have a meaningful impact, because in those instances where NISO has to say, well, we need as much flex as possible or allow for more flex, because we don't know what the extreme environment might be, because of the reasons I gave earlier.

Speaker #2: But outages of generation plants is the big one. They will then, by then, be able to see, "Oh gosh, we've got a lot more battery capacity than we expected," because so far we've been assuming 30 minutes' worth.

Ben Guest: By then they will be able to see, oh gosh, we've got a lot more battery capacity than we expected because so far we've been assuming 30 minutes worth. We've actually got 2 hours in that one, and so on. We don't need to be quite as cautious in terms of using less efficient technologies. We can let them go and focus more on batteries, which are basically cheaper, and start to see better utilization of batteries on the back of that. That's certainly what's been indicated by NESO.

Speaker #2: We've actually got two hours in that one, and so on. We don't need to be quite as cautious in terms of using less efficient technologies.

Speaker #2: We can let them go and focus more on batteries, which are basically cheaper, and start to see better utilization of batteries on the back of that.

Speaker #2: That's certainly what we've been told by what's been indicated by NISO.

Speaker #1: Thank you. Can you comment on dividend policy over the next two to three years?

Rupert Robinson: Thank you. Can you comment on dividend policy over the next two to three years?

Speaker #2: If I may pass the buck, this is a board matter. The board is planning to give an update; they have committed to this.

Ben Guest: This is, if I may pass the buck.

Rupert Robinson: Sure

Ben Guest: This is a board matter. The board is planning to give an update. They have committed to this, at some stage, I think before the end of the year. I cannot remember exactly the timing, apologies.

Speaker #2: At some stage, I think before the end of the year—I can't remember exactly the timing, apologies—but there's a commitment to do so.

Rupert Robinson: Sure.

Ben Guest: There is a commitment to do so. If you do listen to rerun messages from the last few quarters, however, we have indicated that there is a wish to grow this company. There is a sort of energy transition.

Speaker #2: If you do listen to rerun messages from the last few quarters, however, we have indicated that there's a wish to grow this company, that there's a sort of energy transition going on here, and there's a wish to recycle capital.

Rupert Robinson: Yeah

Ben Guest: going on here, and there's a wish to recycle capital. But I won't say more now. Then fundamentally, this business is set up to provide a balance between income and capital growth.

Speaker #2: But I won't say more now. And fundamentally, this business is set up to provide a balance between income and capital growth.

Rupert Robinson: Yeah. Okay. I suspect there are also parts of this question or next questions that you can answer, and those that probably are best parked. Anyway, let me just read them out. When do you expect the new 777 MW to be included in NAV at DCF rather than cost? Is this likely to be the next big NAV boost?

Speaker #1: Yeah, okay. I suspect there are also parts of this question or the next questions that you can answer, and those that probably are best left to others. But anyway, let me just read them out.

Speaker #1: When do you expect the new 777 megawatt to be included in NAV at DCF rather than cost? Is this likely to be the next big NAV boost?

Ben Guest: To the second part of the question, yes. It is-

Speaker #2: To the second part of the question: yes, it is.

Rupert Robinson: What is the approximate revenue per megawatt from the alternative revenues? How fast can you ramp this up?

Speaker #1: What is the approximate revenue per megawatt from the alternative revenues? How fast can you ramp this up?

Speaker #2: Okay, got it. So there are two parts to the question there. On the incremental 777, we'll revalue them at the quarter end, following financial close.

Ben Guest: Okay, got it. There are two parts to the question there.

Rupert Robinson: Sure.

Ben Guest: On the incremental 777-

Rupert Robinson: Yeah

Ben Guest: We will revalue them at the quarter end following financial close. That might be staggered in the end, we will see.

Speaker #2: And that might be staggered in the end. We'll see. Hopefully, we can do it as one financing, but if it needs to be staggered because Ray leaves a bit behind, or something else, it'll be staggered.

Rupert Robinson: Yeah.

Ben Guest: Hopefully we can do it as one financing, but if it needs to be staggered because we are a little bit behind or something else, it will be staggered. That will be a meaningful impact and very round numbers. You could probably go, what was the uplift per megawatt this quarter?

Speaker #2: But that will be a meaningful impact. And, in very round numbers, you could probably look at what was the uplift per megawatt this quarter, and say something vaguely similar for these assets incrementally as well.

Rupert Robinson: Yeah.

Ben Guest: And say something similar, vaguely similar for these assets incrementally as well, subject to-

Speaker #2: Subject to.

Rupert Robinson: But at 2027 rather than 2026.

Speaker #1: But a 2027 rather than 2026.

Ben Guest: Sorry, yes. The timing of that will be 2027.

Speaker #2: Sorry. Yes, and the timing of that will be 2027, most likely Q3 or Q4. In terms of alternative revenues, we've highlighted that the pounds per megawatt hour achieved in the trial was in the region of £23.

Rupert Robinson: Yeah.

Ben Guest: Most likely Q3 or Q4.

Rupert Robinson: Yeah.

Ben Guest: In terms of alternative revenues, we have highlighted that the GBP per megawatt hour achieved in the trial was in the region of GBP 23. We need to see this strategy operate in more different backdrops and a larger scale before we commit to, or we will just start to report the actual numbers. GBP 5 to GBP 10 is what we have indicated, which is similar to the level of revenues that we are earning from the existing fleet today. It is scalable across, probably approaching 50% of our megawatts, hopefully relatively cautiously. There is a lot to go for here. I do not want to make any new

Speaker #2: We need to see this strategy operate in more different backdrops and on a larger scale before we commit to it, or we'll just start to report the actual numbers.

Speaker #2: Five to ten pounds is what we've indicated, which is similar to the level of revenues that we're earning from the existing fleet today. And it's scalable across probably approaching 50% of our megawatts, hopefully relatively cautiously.

Speaker #2: So there's a lot to go for here. And, yeah, I don't want to make any new forecasts or commitments on behalf of the company now, but we do stick and stand by our £25 million EBITDA target.

Rupert Robinson: Sure

Ben Guest: forecasts or commitments on behalf of the company now. We do stick and stand by our GBP 25 million EBITDA target.

Rupert Robinson: Okay. Outside of your alternative revenue strategy, are you using different optimizers for your various sites or just one?

Speaker #1: Okay. Outside of your alternative revenue strategy, are you using different optimizers for your various sites, or just one?

Speaker #2: Sorry, was this alternative revenues or something else? Sorry.

Ben Guest: Sorry, was this alternative revenues or something else. Sorry.

Speaker #1: No, I know. Outside of alternative revenues. So, yeah. So, really a question around how many optimizers do we use?

Rupert Robinson: No, outside of alternative revenues. So, really a question around how many optimizers do we use?

Ben Guest: Yeah, absolutely.

Speaker #2: Yeah, absolutely. We've got five or six different optimizers across the fleet. The majority of the floors are—this is all public information.

Rupert Robinson: Yeah.

Ben Guest: We've got five or six different optimizers across the fleet.

Rupert Robinson: Yeah.

Ben Guest: We've got the majority of the floors, this is all public information, of the actual floors are with EDF and Statkraft. And we have an effective floor through essentially an ISDA with an insurance company for a significant portion of the rest.

Speaker #2: Of the actual floors, some are with EDF and Statkraft. And we have an effective floor through essentially an ISDA with an insurance company for a significant portion of the rest.

Speaker #1: Okay. What specifically needs to happen between now and 2030 for revenues to converge with the third-party forecasts?

Rupert Robinson: Okay. What specifically needs to happen between now and 2030 for revenues to converge with the third-party forecasts?

Ben Guest: Very good question. When you look at the macro, you can almost dare to get a bit excited because you've got growing electricity demand. You've got a couple of nukes coming offline. You've got Drax generating less power as well. That's a commitment that's made that kicks in Q2 next year, I think, if I remember rightly. That's a huge asset. It's going to, overall, generate half the output that it has done to date, somewhere close to 4 GW. So we've got demand increasing, we've got supply, especially dispatchable base load-like supply decreasing. We've got a huge growth to fill in that gap in renewable generation, such that it's likely to take renewable generation from 40 something percent to over 80% in the next 4 or 5 years.

Speaker #2: Very good question. So, when you look at the macro, you can almost dare to get a bit excited, because you've got growing electricity demand.

Speaker #2: You've got a couple of nukes coming offline. You've got DRAX generating less power as well. That's a commitment that's made that kicks in in Q2 next year, I think, if I remember rightly.

Speaker #2: And that's a huge asset, and it's going to overall generate half the output that it has done to date—somewhere close to 4 gigawatts.

Speaker #2: So we've got demand increasing. We've got supply, especially dispatchable, base load-like supply, decreasing. And we've got a huge growth to fill in that gap in renewable generation.

Speaker #2: Such that it'd like it to take renewable generation from 40-something percent to over 80%. In the next four or five years. So all of that translates into a very, very much more volatile environment with the bottlenecks and constraints that exist in the network still becoming remaining a serious problem even if lots of money has been spent to increase the amount of power that can flow at those constraints.

Ben Guest: All of that translates into a very, very much more volatile environment, with the bottlenecks and constraints that exist in the network still remaining a serious problem, even if lots of money is being spent to increase the amount of power that can flow at those constraints. So you see all of that. You see the likelihood that the gas assets that mostly behave like peakers these days with flexible generation. I expect a proportion of those, potentially a fairly large proportion, as I mentioned earlier, potentially half, given that half are over 30 years old now. It's starting to go offline or having more issues.

Speaker #2: So, you see all of that. You see the likelihood that the gas assets—which mostly behave like peakers these days, with flexible generation—I expect a proportion of those, potentially a fairly large proportion, as I mentioned earlier, potentially half, given that half are over 30 years old now.

Speaker #2: It's starting to go offline or having more issues. So really, it means that batteries go from being one of the smaller sources of flexibility—especially given the shorter duration of the fleet—to a much larger proportion of peak megawatts and the amount of time that they can operate for, and therefore megawatt-hours or gigawatt-hours.

Ben Guest: So really it means that batteries go from one of the smaller sources of flexibility, especially given the short duration of the fleet, to a much larger proportion of peak megawatts and the amount of time that they can operate for, and therefore megawatt hours or gigawatt hours. All of that means that it gives a good reason why the overall curve should be heading higher from a macro perspective in the absence of skip rates. The other and very important thing that we need, though, is a reduction in skip rates.

Speaker #2: So all of that means that it gives a good reason why the overall curve should be heading higher from a macro perspective in the absence of skips.

Speaker #2: The other very important thing that we need, though, is a reduction in skip rates. Because at the moment, if you've got the control room purely to manage risk, it has to turn certain assets on first—whether it's dispatching or scheduling interconnectors, pumped storage hydro, gas assets, potentially Drax as a biomass asset, and so on. Turning those on, or having them available first and therefore prioritized, naturally means that batteries are left to last.

Ben Guest: Because at the moment, if you have the control room, purely to manage risk, it has to turn certain assets on first, whether it is dispatching or scheduling interconnectors, pump storage, hydro, gas assets, potentially Drax biomass asset and so on, and turning all those on or having them available first and therefore prioritized, it naturally means that batteries are left to last. As we get more visibility of batteries, as we have many more batteries as a percentage of total flex, that effect should decrease. Hopefully, I do think another thing that needs to happen, which I am less confident about, is the amount of automation and computer intelligence to help in those scenarios as well.

Speaker #2: As we get more visibility of batteries, as we have many more batteries as a percentage of total flex, that effect should decrease. And hopefully—I do think another thing that needs to happen, which I'm less confident about—is the amount of automation and computer intelligence to help in those scenarios as well.

Speaker #2: But the combination of all these things, processes, mix of flex, and in particular the growing percentage of batteries, and technology and also computing power in the control room should all contribute to the flexible all the flexible market being available to batteries, not just what remains after other assets have been prioritized.

Ben Guest: The combination of all these things, processes, mix of flex, and in particular, the growing percentage of batteries, and technology and/or sort of computing power in the control room should all contribute to the flexible, all the flexible market being available to batteries, not just what remains after other assets have been prioritized. That is what is needed.

Speaker #2: That's what's needed.

Speaker #1: Thank you, Ben. Another question on the alternative revenues, specifically around what the trials have achieved. The trials have significantly beaten the 5 to 10 megawatt-hour metric you are using to get to the £25 million.

Rupert Robinson: Thank you, Ben. Another question on the alternative revenues.

Ben Guest: Yeah.

Rupert Robinson: Specifically around what the trials have achieved in terms of, the trials have significantly beaten the 5 to 10 MWh you are using to get to the GBP 25 million. Can you explain why you expect this to be so much lower than the 23 MWh you have seen in the trials?

Speaker #1: Can you explain why you expect this to be so much lower than the 23 megawatt-hours you've seen in the trials?

Speaker #2: It was very—I certainly can't explain it. I'm just trying to word it in a useful way while also not disclosing anything we don't want to disclose.

Ben Guest: I certainly can explain it. I am just trying to word it in a useful way, while also not disclosing anything we do not want to disclose. But essentially, we are expecting a margin, essentially between the price that can be captured at spot by batteries somewhere towards the end market, without giving that away.

Speaker #2: But essentially, we're extracting a margin between the price that can be captured at spot by batteries and somewhere towards the end market.

Speaker #2: And without giving that away, that margin can vary significantly according to the amount of renewable generation on the system. During the trial period, there was quite a lot of wind.

Rupert Robinson: Yeah.

Ben Guest: That margin can vary significantly according to the amount of renewable generation on the system. During the trial period, there was quite a lot of wind, so you have to be cautious about where the outturn is. Having said that, without changing our forecast or our assumptions, given that we are heading from 40 something percent, 45 odd percent wind and solar in this country to 80%, we do expect the amount of time that renewables together generate significantly more than might be expected from them to grow, that having a favorable impact on wholesale prices. So let us see how everything pans out, but we do have to be cautious here just because

Speaker #2: And so you have to be cautious about where the outturn is. Having said that, without changing our forecast or assumptions, given that we're heading from forty-something percent—forty-five-odd percent—wind and solar in this country to eighty percent, we do expect the amount of time that renewables together generate significantly more than might be expected from them to grow, and that having a favorable impact on wholesale prices.

Speaker #2: So let's see how everything pans out, but we do have to be cautious here just because it's a short period.

Rupert Robinson: Yeah. Prudence.

Ben Guest: short period.

Speaker #1: Sure, sure. What is the impact on the BESS market from higher gas prices as a result of the Iran war? Are we seeing a rerun of the Ukraine war impact?

Rupert Robinson: Sure. What is the impact on the BESS market from higher gas prices as a result of the Iran war? Are we seeing a rerun of the Ukraine war impact?

Speaker #2: We're in the gas prices in the foothills of the Everest share price shape that we not share price, gas price shape that we saw between '21 and '24, I suppose.

Ben Guest: The gas price is in the foothills of the Everest gas price shape that we saw between 2021 and 2024, I suppose. But it is at multi-year highs now, and it absolutely increases volatility in the market, and we are seeing that now. Sorry, I do not think I spoke to the recent trading question earlier.

Speaker #2: But it is at multi-year highs now, and it absolutely increases volatility in the market. We're seeing that now. Sorry, I don't think I spoke to the recent trading question earlier.

Rupert Robinson: Yeah.

Speaker #2: It gives me a second chance. If you look at the Modo index, or Best Analytics, or any other platform that shows recent trading, we are close to highs for the year.

Ben Guest: It gives me a second chance. If you look at the Modo Energy index or Vest Analytics or any other platform that shows recent trading, we are close to highs for the year.

Speaker #1: Thank you.

Rupert Robinson: Thank you.

Ben Guest: In terms of volatility.

Speaker #2: In terms of volatility.

Speaker #1: Yeah. Can you explain why balancing revenues are negative? And what needs to happen to get this to turn positive again?

Rupert Robinson: Can you explain why balancing revenues are negative, and what needs to happen to get this to turn positive again?

Speaker #2: I don't know what's meant by balancing revenues being negative. I'm going to guess that that's looking at the best analytics portal. I don't know exactly how they construct this, but my guess is that there's an assumption in that model that assumes that you only charge in the balancing mechanism, only export in the wholesale, or largely do that.

Ben Guest: I do not know what is meant by balancing revenues being negative. I am going to guess that is looking at the Vest Analytics portal.

Rupert Robinson: Yeah.

Ben Guest: I do not know exactly how they construct this, but my guess is that there is an assumption in that model that assumes that you only charge in the balancing mechanism, only export in the wholesale, or largely do that. That means that you are only incurring costs in the balancing mechanism rather than doing more balanced trading in terms of importing and exporting in the balancing mechanism. But the overall line that goes through the overall chart, that is the sum of everything, is what we need to look at and is the number that is heading higher. Hopefully, that is useful to the person you are.

Speaker #2: And that means that you're only incurring cost in the balancing mechanism, rather than doing more balanced trading in terms of importing and exporting in the balancing mechanism.

Speaker #2: But the overall line that goes through the entire chart—that's the sum of everything—is what we need to look at, and it's the number that's heading higher.

Speaker #2: Hopefully, that's useful to the person you asked. We'll have to see something offline if they want to call us.

Rupert Robinson: Okay.

Ben Guest: Happy to say something offline if they want to call us.

Speaker #1: Thanks. There are a couple of questions here around Primestone and the dialogue there. I think, look, a couple of comments there—and I speak on behalf of the manager, G.

Rupert Robinson: Thanks, Ben. There are a couple of questions here around PrimeStone and the dialogue there. I think, look, a couple of comments there. I speak on behalf of the manager, GHAM here, and as a colleague of Ben's and Harry's. Our goal is to maximize shareholder value from delivering on our growth strategy. I think the manager's been very clear on that. Obviously, the board have had a number of constructive dialogues with PrimeStone. There have been various RNSs released, which have obviously been seen by everyone. I think that there's a common goal here, which is to see a higher share price, see a reduction in the NAV discount, and to maximize returns for all shareholders. I think getting into any discussion or debate beyond that, doesn't serve any purpose here.

Speaker #1: Ham here, and as a colleague of Ben's and Harry's, our goal is to maximize shareholder value by delivering on our growth strategy. I think the manager has been very clear on that.

Speaker #1: Obviously, the Board have had a number of constructive dialogues with Primestone. There have been various RNSs released, which have obviously been seen by everyone.

Speaker #1: And I think that there's a common goal here, which is to see a higher share price, see a reduction in the NAV discount, and to maximize returns for all shareholders.

Speaker #1: I think getting into any discussion or debate beyond that doesn't serve any purpose here. Suffice to say that I know the board and its advisors will continue to have a dialogue with Primestone as well as all other shareholders whom they have consulted over recent weeks and months.

Rupert Robinson: Suffice to say that I know that the board and its advisors will continue to have a dialogue with PrimeStone, as well as all other shareholders who they have consulted over recent weeks and months. We, as the manager, will be involved as and when the board deem it appropriate. In the meantime, we will continue to have a laser focus on driving and maximizing shareholder value.

Speaker #1: And we, as the manager, will be involved as and when the board deems it appropriate. In the meantime, we will continue to have a laser focus on driving and maximizing shareholder value.

Speaker #2: Nothing to add.

Ben Guest: Nothing to add there.

Speaker #1: I think, Ben, that that's all the questions we've had from the audience. I think we are obviously at 10:45, 10:47, so I think we'll close the formal session there.

Rupert Robinson: I think, Ben, that is all the questions that we have had from the audience. I think we are obviously at 10:47 AM, so I think we will close the formal session there. I would like to thank everyone for attending this morning's presentation. Ben and Harry, thank you for your contributions as ever. Thank you to all our shareholders for their patience and support over the last 18 months as we have been on this recovery journey. I think the team continue to innovate, continue to execute, and as I say, remain absolutely laser-focused on driving and maximizing shareholder value. If anyone has any further questions or would like to follow up directly with the manager, we will obviously be delighted to do so. But in the meantime, thank you again for attending this morning, and hopefully see everyone soon. Thank you.

Speaker #1: I'd like to thank everyone for attending this morning's presentation. Ben and Harry, thank you for your contributions as ever. Thank you to all our shareholders.

Speaker #1: For their patience and support over the last 18 months as we've been on this recovery journey. I think the team continues to innovate and continues to execute.

Speaker #1: And as I say, we remain absolutely laser-focused on driving and maximizing shareholder value. If anyone has any further questions or would like to follow up directly with the manager, we would obviously be delighted to do so.

Speaker #1: But in the meantime, thank you again for attending this morning and hopefully see everyone soon. Thank you.

Speaker #2: Thank you.

Ben Guest: Thank you.

Operator 2: Goodbye

Operator: Goodbye