Downing Renewables upbeat on recent portfolio progress

Downing Renewables & Infrastructure announced a series of positive developments across its portfolio in an update on Monday.

The London-listed company said Mersey Reactive Power, a UK-based shunt reactor it acquired in June 2023, had successfully renegotiated its contract with the National Grid Electricity System Operator (NGESO).

It said the updated agreement allowed the reactor to provide unlimited reactive power to the Merseyside area, significantly increasing its annual revenue by about £0.3m, representing a 30% boost for the remaining nine years of the contract.

The increase was indexed to inflation, and was part of the National Grid's Stability Pathfinder Initiative.

In Sweden, Downing said the Gottne hydropower plant had started generating revenue following its pre-qualification for participation in the Frequency Containment Reserve (FCR) markets on 5 July.

Additionally, Downing Hydro (DHAB) had applied for a second hydropower plant to join the FCR-D market, with plans to continue expanding this programme across its hydropower portfolio.

Blåsjön Nät, a Swedish electricity distribution system operator acquired by Downing in July 2023, had meanwhile received regulatory approval for its capital investment programme for Regulatory Period 4, from 2024 to 2027.

The Swedish regulator, Ei, set a weighted average cost of capital (WACC) of 4.5% for Blåsjön’s charges, a significant increase from the 2.3% WACC in the previous regulatory period.

Downing said the approved investment amounted to about SEK 33m (£2.4m).

Blåsjön had also announced the appointment of Jan Delin as its new chief executive officer, succeeding Ingemar Persson, who had retired after 27 years.

Delin would bring extensive experience, the company explained, having served as CEO of Edsbyn Elverk for a decade and as a board member of Blåsjön for nearly five years.

“We are pleased with the progress made by DORE's revenue optimisation strategy, as we continue to enhance our grid and hydropower assets and unlock further value from the portfolio,” said Tom Williams, partner and head of energy and infrastructure at Downing LLP.

“This progress is testament to the ongoing work undertaken by our deeply knowledgeable and experienced asset management team at Downing.”

At 1135 BST, shares in Downing Renewables and Infrastructure were up 0.29% at 77.32p.

Reporting by Josh White for Sharecast.com.