Strategic progress continues for SIMEC Atlantis’ SAE Renewables, as highlighted by their interim results, which mark a significant phase in the company’s transformation. The new strategic direction focuses on establishing SAE as an independent power producer (IPP) with a focus on battery energy storage systems (BESS). This new focus builds on the company’s legacy of developing and operating the world’s largest tidal stream generation portfolio. Notably, the interim results were positively impacted by cash inflows from the land sale for the first Uskmouth BESS project, with ongoing progress for the second phase.
During this period, SAE Renewables made notable progress on the second Uskmouth BESS project, known as Afon Wysg 1 (AW1). This project, with a capacity of 120MW and 240MWh, is expected to deliver annual revenue of £12 million once connected to the grid in October 2026. The anticipated cost for AW1 is £65 million, and SAE is actively working on financing to move this forward.
SAE is also advancing a substantial pipeline of BESS projects, totalling 719MW at Uskmouth and 207MW at the MeyGen site in Scotland. The majority of these projects already have grid connections secured, positioning the company well to benefit from potential changes in grid regulations. The new “first ready, first connected” model could allow SAE’s projects to be connected faster, especially those with secured land rights and planning permissions. Additionally, SAE is actively exploring more BESS opportunities beyond its current projects.
On the tidal energy front, SAE’s recent success in the AR6 Contracts for Difference (CfD) round was a significant achievement, securing support for 9MW of new capacity at a price of £172 per megawatt-hour (MWh), equivalent to an estimated £240/MWh at today’s values. This success builds on previous achievements in AR4 and AR5 rounds, at prices of £178.54/MWh and £198.0/MWh, respectively, bringing the total supported capacity to 59MW, alongside the existing 6MW from MeyGen phase 1. SAE is now focused on funding to progress these tidal projects.
Financially, SAE Renewables reported interim revenue of £12.1 million, close to the previous year’s £12.4 million. A significant portion of this revenue came from the £7 million generated by the land sale associated with the initial BESS project, in addition to steady earnings from the MeyGen tidal project. Revenue is expected to improve next year, as the redeployment of the fourth turbine is anticipated by the end of Q4 2024. The remaining £2.9 million from the land sale is expected to be received by the end of Q1 2025. There was a £9.9 million cost recorded in relation to the land sale, reversing previous recognition from FY 2023, though this adjustment was non-cash in nature. Operating costs showed a slight reduction, partly due to a significant decrease in MeyGen costs, while staff costs normalised. By the end of the reporting period, the company held a healthy cash balance of £7.7 million, benefiting from the proceeds of the land sale.
SAE Renewables’ progress with both BESS and tidal energy projects underscores its evolving role as an independent power producer. The company’s focus on expanding energy storage capabilities and advancing tidal generation highlights its ongoing commitment to renewable energy growth and adaptation in a shifting energy landscape.
SAE Renewables Limited (LON:SAE) was founded in 2005 as a supplier of tidal stream turbines, SAE quickly grew to include development of tidal stream projects and is the majority owner of MeyGen, the world’s largest tidal stream energy project.
