MeyGen firm announces £4.5m profit
Register for free to read more of the latest local news. It's easy and will only take a moment.
The company pioneering tidal energy in the Pentland Firth has announced that it made a £4.5 million profit in the first half of 2023.
Simec Atlantis won four new Contracts for Difference (CfDs) for its MeyGen tidal energy array in the recent UK government auction, which allows it to sell its power for a guaranteed price.
It said the 50MW tidal power plant off the Caithness coast is expected to become operational during 2027.
The profit before tax of £4.5 million for the six months ended June 30 compares to a loss of £8.6 million reported for the same period in 2022.
Simec chairman Duncan Black said the strong first-half performance benefited from the sale of the company’s first battery energy storage system (BESS) development project at Uskmouth, as well as the significant restructuring of the business undertaken in 2022.
“We also continue work on a more than 200MW BESS project at MeyGen that could be connected as early as 2027,” he said. “The development of BESS projects is critical in support of the growing dependence of electricity grids on weather dependent renewable energy sources.”
Simec secured a total of 22MW for the MeyGen site over four CfD contracts from the UK government’s AR5 allocation round last month. In addition to 28MW secured in AR4 in July 2022, the next phase of MeyGen will be developed as a combined 50MW array with newly developed 3MW tidal turbines.
The financial statement published last week explained that the higher strike price for the latest CfD contracts alongside economies of scale for the two separate rounds were a “significant boost to the project economics”.
Simec aims to reach financial close in quarter two of 2025, with operation of the 50MW array commencing in 2027. It describes phase two of the development as a “hugely challenging project” but says securing the revenues is a huge step forward.
The company will now turn its attention to securing tidal turbine supply for 3MW turbines, consenting variations to enable the larger turbines and financing for the project, it said.
