SAE enters contracts for AW1 Battery Project

SAE is pleased to announce the entry into supply and construction contracts for its AW1 battery storage project ("AW1") at the Uskmouth Sustainable Energy Park ("USEP").

The AW1 project is a 240MWh battery storage project with the ability to increase to 480MWh. The project is SAE's flagship project at the USEP, which has the potential to be one of the largest battery storage sites in the UK. The site is key to unlocking an economic, environmental and social revival around Newport. The project is owned and is being constructed by AW1 Energy Storage Limited ("AWES"), a company dedicated to the construction, ownership and operation of this project.

The batteries for AW1 are being purchased from Canadian Solar SES (UK) Ltd ("CSES"). CSES is one of the world's leading manufacturers of battery energy storage solutions. CSES has developed, built, and connected over 3.7GWh of battery energy storage projects globally. CSES will also provide a 15-year long term service agreement for the project, ensuring a bankable long-term warranty for the project.

SAE and CSES have also entered into a framework agreement that secures the supply of batteries for SAE's future battery storage projects. Under this framework agreement, CSES has committed to 1.1GWh of batteries that will be supplied at competitive market prices to two of SAE's future projects, Mey BESS and AW3. Subject to the benchmarking of pricing, SAE has agreed to procure this capacity of batteries exclusively from CSES. SAE has provided a parent company guarantee in respect of this commitment, which has a liability cap of £3.65m. The agreement with CSES is strategically important for SAE as it secures a supply of market leading battery storage systems and enables SAE to efficiently build out a portfolio of battery storage projects, capitalising on the success of AW1.

The balance of plant contract for the project has been awarded to Welsh-based contractor Jones Bros. Ruthin (Civil Engineering) Co. Limited, who possess exceptional knowledge of the site and are experienced in delivering battery projects, including having worked on the first battery project at the USEP.

SAE has also entered into a 12-year floored revenue optimisation agreement with EDF Energy Customers Limited ("EDF"). Pexapark AG, a leading power purchase agreement commercial advisory firm, assisted SAE with the procurement and development of the optimisation agreement. This agreement will ensure SAE receives guaranteed revenue, and is in addition to the Capacity Market revenues that the project has secured and which SAE previously announced in March of this year.

Construction work has already started on the AW1 project and is being managed by SAE, leveraging the SAE team's expertise from building and operating projects at both MeyGen and Uskmouth. The AW1 project has a contracted grid connection date of October 2026 and an anticipated commercial operations start date of Q1 2027.

SAE will update the market on the financial close process in due course.

SAE launched its strategy in 2024, outlining a path to deliver a pipeline of projects that will achieve its goal of being a leading sustainable project developer, owner and operator, ensuring long-term value for shareholders.

David Taaffe, Chief Operating Officer of SAE, commented:

"We are thrilled to have put in place a team to deliver our flagship AW1 project. Our project partners are world leaders, and their involvement in this project is key in ensuring its success, both in terms of delivery and in the project's successful long-term operation. We are also pleased that all our project partners are completely aligned with our wider vision for the Uskmouth Sustainable Energy Park. They recognise the potential for USEP to become one of the largest battery storage sites in the UK and be a catalyst for local and national regeneration."