London firm raises money for Scotland biomass plants

By Lisa Gibson
Posted November 11, 2009, at 11:06 a.m. CST

London-based Invicta Capital, a company that offers investment opportunities to private and institutional investors, is working to raise 300 million pounds ($498 million) for the development of nine biomass power plants in Scotland that will together produce up to 90 megawatts of electricity, enough to power up to 140,000 homes.

The first two will be built in the Caithness area and the timelines for construction and operation depend on the amount of money raised so they are undetermined, according to Ken Cronin, public relations representative for Invicta. Each plant is modular by design, so they will not all be uniformly 10 MW, he said. The first phase of the project requires 35 million pounds and Invicta hopes to obtain that by the end of February. "The beauty of this fund is as soon as the required amount is raised for each phase, the money will be put to use as the sites have already been identified," Cronin said. Invicta is in negotiations with technology providers, and the plants will be built in phases as the money is raised, he said. The power produced will be sold to a local utility through a contact already in place.

All nine plants will run on woody biomass under long-term supply agreements with forestry companies. RTS Ltd., a forest harvesting and management company, will negotiate the contracts, as the company has long-term relationships with forest owners and is committed to the local market for sourcing timber, which keeps transportation costs and the carbon footprint at a minimum, Cronin said. A sustainable supply is crucial and Cronin said two trees will be planted for every one tree used. The plants will use pyrolysis to produce gas and then conventional gas engines.

Invicta has raised funds for projects before, but this will be the first endeavor to target institutional money in addition to high net worth individuals, according to the company. The fund is unusual among renewable energy vehicles because it has specified the form of technology as well as identified the locations of the plants.