Green Investment Bank funds biomass CHP plant in England

By UK Green Investment Bank | September 21, 2015

The UK Green Investment Bank plc and John Laing Group plc have committed £48m ($74.4 million) of equity to a new £138m renewable energy facility in North East England, developed by Estover Energy.

The biomass combined-heat-and-power (CHP) plant in Cramlington, Northumberland, will generate 213 GWh of renewable electricity annually, enough to power 52,000 homes. It is also expected to reduce greenhouse gas emissions by circa 56 kt CO2e annually, the equivalent of taking 25,000 cars off the road during its lifetime.

Much of the generated electricity will be purchased by Statkraft under a long-term power purchase agreement, but the area’s thriving pharmaceutical sector, recognized as an essential element of the North East economy, will benefit from its output.

Electricity will be supplied to local businesses operating in the adjacent industrial estate, namely Aesica Pharmaceuticals and MSD. The plant will also have the potential to provide renewable heat to neighboring facilities.

GIB will make a £21m investment in the project, with John Laing investing in a stake worth £27m. Barclays will provide the remainder of the funding as debt, 60% of which will be guaranteed by the Danish export credit agency EKF.

The construction of the plant will be undertaken by a consortium of Burmeister & Wain Scandinavian Contractors A/S, the consortium leader, and Burmeister & Wain Energy A/S. BWSC will operate the plant upon completion under a 12-year Operations & Maintenance contract. Up to 25 permanent positions will be maintained at the operational facility, with further jobs created within the project supply chain.

Fuel for the plant will be provided by local growers and forest industry suppliers.