The Equitix-managed fund Energy Savings Investments (ESI), in which the GIB is a cornerstone investor, is investing £14.6 million (US$22.8 million) in the project. An addition £15 million (US$23.4 million) of private capital has been mobilized from the Equitix Energy Efficiency Fund (EEEF). The total project investment is estimated at £30 million (US$ 46.7 million).
To be built in the Holbrook area of the city of Sheffield and developed by UYE (UK), the project will have a generating capacity of over 6.5 MW 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.
Kantor Energy, a specialist District Heating Design & Build Engineering firm, will act as the Engineering, Procurement, and Construction (EPC) principal contractor.
The site's biomass boiler and flue gas cleaning systems are being supplied by biomass specialist VAS Energy Systems International. Turboden will supply the clean electricity generation equipment.
Once operational, expected to be in March 2017, the project will sell electricity to GDF Suez UK under a long-term power purchase agreement (PPA).
Veolia Energy Services has been awarded the long-term operations and maintenance contract.
The GIB's Head of Investment Banking, Ed Northam, commented:
"We are very pleased to be able to help UYE realize 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 utilize innovative technology to create new sources of green power to cut carbon emissions and create important local benefits for communities."
Geoff Jackson, Equitix's Chief Executive Director, stated the following:
"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."
The GIB was launched in November 2012. It is a "for profit" bank whose mission is to accelerate the UK's transition to a greener economy and to create an enduring institution, operating independently of Government.
IPP Journal recently reported on the UK Government's partial privatization of the UK Green Investment Bank.