Battery fund Harmony Energy Income (HEIT ) has announced the energisation of its Kent-based Broadditch project, making it the second asset to go online over the last four months.

Broadditch was energised on schedule following HEIT’s Yorkshire-based project, Pillswood, Europe’s biggest battery energy storage system (BESS) by megawatts, which went online five months early in November.

Broadditch uses Tesla’s two-hour Megapack XL system, which is slightly larger than those used at Pillswood. Both sites use Tesla software AutoBidder, a trading and control platform that autonomously monetises BESS.

When Broadditch becomes operational by the end of the month, the portfolio’s total operational capacity will be 109MW. That figure should rise to 193.5MW by the end of the year if construction remains on time with four assets due to be completed in 2023.

The increased revenue from the energisation of assets means the dividends will be ‘well covered’, chairman Norman Crighton said in the trust’s maiden annual results two weeks ago. The trust paid the 2p payout per share in 2022 through its reserves and is targeting an 8p dividend this year at an 8% yield.  

That is further assured by record-level prices at the recent capacity market auctions, where the government buys supplies of energy for the future.

At the T-1 auction held last month, HEIT secured one-year contracts at £60kW per year, the second highest on record, totalling £3.7m of revenue. This will commence in October 2023 across the Pillswood, Broadditch, Farnham and Rusholme projects.

HEIT is yet to announce the results of February’s T-4 auction, in which the government buys most of the capacity needed for delivery in 2026.

In order to finance the construction of Hawthorn Pit and Wormald Green, located in County Durham and Yorkshire respectively, the £274m trust extended its debt facility to £110m from NatWest with a £20m revolving credit facility last month. Last month, outstanding commitments totalled £148m.

The debt facility gives the company some legroom after a failed C share issue in October raised £15m out of a targeted £130m.

The trust’s 2.3% discount to net asset value has meant another attempt has been ruled out for now, though not for want of trying, with the illiquidity of the shares meaning HEIT could not buy them back to narrow the discount.

‘There aren’t big sellers particularly in the stock, so the share price is really determined by a small number of retail shares trading really,’ said HEIT’s Paul Mason and Max Slade. ‘We saw this in October when the share price went very low and we as management were trying to buy shares and we couldn’t.’ 

An average of £237k shares’ worth has been traded daily over the last 12 months, according to Numis, which is at the lower end of investment company liquidity. By comparison, rival Gore Street Energy Storage (GSF) has an average of £1.3m.

Over the last 12 months to date, the shares have risen 26.3%, the second-highest in the 22-strong AIC renewable energy infrastructure sector, behind Gresham House Energy Storage (GRID ), which returned 30.5%.