U.K. GIB, Equitix to fund construction of bioenergy project

By U.K. Green Investment Bank | July 20, 2015

U.K. Green Investment Bank plc and Equitix have announced a commitment to fund the construction of a £30 million ($46.68 million) energy facility in Sheffield.

The Equitix managed fund Energy Savings Investments, in which GIB is a cornerstone investor, is investing £14.6 million in the project. An additional £15m of private capital has been mobilized from the Equitix Energy Efficiency Fund.

The plant is to be built in the Holbrook area of the city and was developed by UYE (UK) Ltd. It will generate over 6.5 MW of green electricity and will be built as combined-heat-and-power (CHP) “ready” with the potential to supply heat to more than 6,700 local homes and commercial properties.

It is expected to cut greenhouse gas emissions by approximately 12,700 metric tons of CO2e per year, the equivalent of taking 5,700 cars off the road for the life of the project.

Kantor Energy Ltd., a specialist District Heating Design & Build Engineering firm will act as the EPC principal contractor. The scheme’s biomass boiler and flue gas cleaning systems are being supplied by biomass specialists VAS Energy Systems International GmbH. Turboden Srl will supply the clean electricity generation equipment.

Once operational the project will sell electricity to GDF Suez UK under a long-term power off take agreement and Veolia Energy Services Ltd. has been awarded the long-term operations and maintenance contract.

The development is expected to create 60 jobs during construction and a further 15full-time positions once operational.

Ed Northam, head of investment banking at GIB, said, “We are very pleased to be able to help UYE realise its vision of a highly-efficient, smaller-scale, CHP ready plant. It is a project that typifies the role of the GIB in helping developers to utilise innovative technology to create new sources of green power to cut carbon emissions and create important local benefits for communities.”

Geoff Jackson, chief executive director at Equitix, said, “Closing this deal marks a significant milestone for Equitix; it is the first community-scale biomass project in our energy efficiency portfolio and delivers beneficial carbon savings to the environment. We expect to see similar deals closing in the coming months and through these investments will continue to do what we set out to do: creating a more sustainable UK. Equitix is pleased to have achieved this close on behalf of our investors.”

Stephen Brooks, director of UYE (UK) Ltd., said, “It has taken us over five years and almost half a million pounds to get this project designed, consented and funded and we are absolutely delighted that the U.K. Green Investment Bank and Equitix have had the courage and commitment to work with a local, small private company and fund this community-scale CHP ready project.”

“We see that these local, community-scale energy generation projects are one of the ways to reduce carbon emissions, reduce grid losses and generate useable, sustainable and affordable heat for local communities,” he continued. “This project is the first in our proposed portfolio of similar developments.”

“Many people told us that we would never be able to compete with the large energy generation companies, but thanks to the help, support and innovative thinking of the GIB and Equitix we have been able to fund this project and bring it through to construction,” Brooks said.