Mast Energy, the UK subsidiary of JSE listed Kibo Energy, raised revenue from its first refurbished generating set at Pyebridge by 16%, to £66 000 (R1.5 million) in July, after factoring in additional revenue.
Before factoring in additional revenue as a result of reduced electricity losses through the transmission system, revenue for the month under review was previously stated at £57 000.
“We are very pleased with the ongoing performance of Pyebridge’s first 2.7MW refurbished genset. Not only have we seen a 16% increase in July’s final revenue tally, we have also seen a marked improvement in the gross profit margin and market out-performance. We expect Pyebridge’s performance to improve as we grow the generating capacity,” said Pieter Krügel, the CEO for Mast Energy. yesterday.
Mast Energy expects preliminary revenue for August to amount to £46 000 before receipt of additional revenue under the embedded benefits.
The firmer revenue generation capacity under the refurbished Pyebridge genset has yielded a capacity market gross profit income payment of £25 000 a month, with the gross profit margin improving to 57%. The electricity sales price achieved for August outperformed the market with 75%, leaving Pyebridge cashflow positive.
Mast Energy said the second 2.7MW genset refurbishment process was going according to plan, with an application for maximum 8.1MW capacity contract set to to be submitted by the end of this month.
Krügel said the performance by the refurbished genset had “proven Pyebridge as our pilot test site to optimise and prove the business model” for the project.
“Pyebridge has demonstrated we can secure asset-level non-equity finance to operate these sites, and we have demonstrated that sites can generate free cash flow post site-level cost of capital, which we are confident we can further improve as we scale up due to economies of scale,” he said.
That had also provided “an excellent framework to replicate for more sites” as the company intended to grow to more than 300MW of generating capacity.
“We have shown we can produce an average revenue per MW per month of c. £21 000 based on Pyebridge’s actual results for July and August, and we look forward to updating the market with ongoing performance data,” said the Mast Energy CEO.
Mast Energy planned to overhaul the then-remaining third genset in order to maximise full reliability, efficiency and revenue generating ability of the Pyebridge site in the most cost-efficient manner.
Pyebridge would also continue to receive its Capacity Market contract income from the UK government. The costs for the second genset’s overhaul would be funded under the Project Finance agreement with RiverFort that enlists Pyebridge as the borrower.
As such, the board of Mast Energy had agreed with RiverFort on a third advance against the project finance agreement amounting to a gross total of £1.1 million. Proceeds from the 3rd Advance would solely be used for works at Pyebridge under the second genset overhaul.
“Once the work on the second genset has been completed, Pyebridge will have 2x 2.7MW completely refurbished gensets operating and generating at optimum capacity and performance, which should have a direct positive impact regarding the site’s PPA revenue generation,” the company explained last month.
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