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The UK Green Investment Bank (GIB) and John Laing Group have pledged to invest £48m into a new biomass Combined Heat and Power (CHP) plant in North East England.
The £138m energy facility is to be developed by Estover Energy in Cramlington, England.
It will generate 213 GWh annually and produce enough electricity to power 52,000 homes.
In addition, it is expected to reduce greenhouse gas emissions by 56 kt CO2e each year.
The generated electricity will be purchased by Statkraft under a Power Purchase Agreement (PPA).
The plant is to also power businesses operating in a nearby industrial estate, namely Aesica Pharmaceuticals and MSD.
In total, GIB is to invest £21m into the project, with John Laing investing £27m.
The remainder of the funding will be provided by Barclays as debt, 60% of which will be guaranteed by EKF, the Danish export credit agency.
A consortium of Burmeister & Wain Scandinavian Contractors A/S (BWSC) and Burmeister & Wain Energy A/S (BWE) will develop the plant, with BWSC operating the plant upon completion under a 12-year Operations & Maintenance contract.
Fuel for the plant will be provided by local growers and forest industry suppliers.
Ed Northam, Head of Investment Banking at the UK GIB, said: "The Cramlington plant promises to create local jobs, support an industry whose vitality is essential to the growth of the regional economy and help cut UK greenhouse gas emissions while promoting the country’s adoption of green energy sources.
Ross McArthur, Managing Director of Renewable Energy for John Laing, said: "Our investment in Cramlington biomass CHP plant builds on the success of our partnership with Estover and GIB established on Speyside Renewable Energy plant. This exciting new project demonstrated the valuable contribution biomass can make to delivering renewable heat in the UK."
Marcus Whately, Founder and Co-CEO at Estover Energy, added: "Nearly £140m invested in the Cramlington CHP plant is fantastic news for the North East and for Estover. It means more jobs in forestry, and a secure energy supply for industry."
(LM/CD)
