Gore Street Energy Storage (GSF ) has secured £15.8m of funding from Nidec Motor Corporation, which has been appointed the main contractor for the £560m battery fund’s Dogfish asset in Texas.

Under a new strategic partnership, Tokyo-listed Nidec, which is already building GSF’s Ferrymuir project in Scotland and operates its Stony facility in Milton Keynes, will buy 14m new GSF shares at 112.9p. Nidec must hold all the shares for at least six months, after which it can sell half of them; the remainder can be sold after a year.

The purchase price matches their net asset value (NAV) as of 30 September released in half-year results last week. Given the shares have traded at a 25% discount to NAV, this offers some validation for the portfolio’s valuation. The shares firmed 0.3% to just over 85p.

GSF did not comment on whether it could use the money to buy back shares and tackle the wide discount. The company had £75m cash at 30 September with a further £13.9m across its subsidiaries, which it needs to meet all its construction commitments. Last week, it said it was open to selling an asset to validate the valuation and release funds for shareholders.

The portfolio has 291.6MW of capacity but aims to add a further 820MW by the end of next year with the build-out of its portfolio, including a new 200MW two-hour facility at Big Rock, California.

Chair Pat Cox was pleased to see Nidec take a 2.8% stake in the company alongside the wealth managers and institutional and retail investors on the register.

Alex O’Cinneide, chief executive of Gore Street Capital, the fund’s manager, said: ‘During the current market dynamics, we are pleased to see a Topix 100 company with a deep understanding of the sector take a material position in GSF.’

Nidec will build, operate and maintain the 75MW Dogfish energy storage facility, one of five being developed for GSF in Texas. It will initially be built with a one-hour duration, although the design will allow for expanding to a two-hour system should the revenue opportunity justify the extra cost.

GSF said the contract was ‘fully wrapped’ and included warranties for availability and energy capacity. Dogfish is scheduled to switch on and link to the Texas ERCOT grid at the end of 2024, an area where it has reaped record revenues from a summer heatwave.

Under the terms of the partnership, Nidec will have five years’ rights to take part in bids for engineering, procurement and construction contracts and will be guaranteed participation in the second stage of the process if it matches or beats the terms of other bidders.

Find out more about the renewable battery sector and Gore Street Energy Storage in our podcast interview with Alex O’Cinneide.