Standard content for Members only
To continue reading this article, please login to your Utility Week account, Start 14 day trial or Become a member.
If your organisation already has a corporate membership and you haven’t activated it simply follow the register link below. Check here.
The Green Investment Group has agreed to partner with US firm Covanta to develop energy-from-waste projects in the UK and Ireland.
The companies will create a 50:50 joint venture to progress their combined pipeline of existing projects as well as pursue fresh opportunities through new developments and acquisitions.
To demonstrate its commitment to the partnership, the Green Investment Group (GIG) has agreed to invest €136 million (£120 million) in a 50 per cent stake in Covanta’s newly opened energy-from-waste facility in Dublin.
The plant, located at Dublin Port, is capable of processing at least 600,000 tonnes of waste annually, generates enough electricity to power approximately 80,000 homes and has the ability to provide district heating for up to 50,000 homes. The transaction is expected to be completed in the first quarter of 2018, subject to approvals.
GIG and Covanta have identified six further projects – three each from their respective development pipelines – which are suitable for development and eventual acquisition by the joint venture.
Four of the projects are already well-advanced, with planning approvals and contractual structures in place. Pending further permitting and project financing, construction on all four is expected to begin within the next four years.
The most advanced of the projects – Rookery in Bedfordshire – is anticipated to break ground in the first half of 2018. The total estimated capital cost of the four projects is $1.6 billion (£1.2 billion).
Under the agreement, as development projects reach financial close and move into the construction phase, the joint venture will acquire the available ownership in each project, with a premium being paid to the original partner. Covanta will provide the operations and maintenance services for joint venture projects.
Edward Northam, head of GIG in Europe, said: “We are delighted to have signed a partnership agreement with Covanta, a world-leading owner and operator of waste-to-energy facilities.
“The projects developed under the partnership will extract energy from residual waste that would otherwise be lost to landfill, avoiding harmful methane emissions.”
Covanta president and chief executive Steve Jones, added: “I am very excited about this strategic arrangement with a highly experienced and committed partner that understands the value of [waste-to-energy] assets and our development and operational capabilities.”
He continued: “The creation of this partnership and investment by GIG into the Dublin project allows us to fully fund an expanded UK development pipeline and enables successful international development and growth on a consistent and repeatable basis.
“GIG and Covanta have highly complementary skills and resources, making this a powerful partnership to execute a robust combined pipeline of opportunities.”
GIG, which was formerly known as the Green Investment Bank, was sold by the government to a consortium led by Australian bank Macquarie for £2.3 billion in August. Shortly afterwards, GIG announced the sale of 70MW of bioenergy and energy from waste assets to the Bioenergy Infrastructure Group for an undisclosed sum.
Covanta owns and operates 43 energy-from-waste facilities around the world, with a combined generating capacity of nearly 1.5GW.
Please login or Register to leave a comment.