A large-scale renewable energy plant is to be set in Teeside, UK. The new 299 megawatt enterprise will contribute to the achieving of UK's renewable energy sources targets and bring a noticeable economic boost into North-East England.
Biomass is now considered to be a budding branch of energy industry. Not only is this energy source promising and eco-friendly, but it's also legislated to be developed throughout Europe. Thus, renewable energy sources issue is now a burning question for many EU countries as they aim to reach their 2020 RES targets. By 2020 the United Kingdom is to reach the index of 15% RES from total energy consumption, and currently it appears to be behind the schedule.
However, there is a prospect of changing this situation in the nearest future. MGT Power is going to install a state-of-the-art plant in Teeside, with total capacity of 299 megawatt. To bring into existence such a project £650 million investment is required. Therefore Macquarie group cooperates with MGT Power to support their venture. They have quite an experience in investing into alternative energy branch, and are going to play the role of the main equity and financial advisor.
MGT project was approved by the European Union in January and it will be provided with UK government aid. The Contract for Difference will ensure the government payments for the produced energy and the sum, which the clean energy producers will get in 15 years. Thus, the agreement seems to be profitable for both parties.
The North-East England region is going to reap benefits from the enterprise. According to some calculations, while constructing the plant 600 people will be given a job, and up to 100 full-time jobs on the regular basis are to be created on plant completing. The plant technologies provide a fair reduce of carbon emission, as compared to fossil fuels. It is to be fuelled with environmentally friendly materials, such as wood chips and wood pellets from certified renewable forestry sources from the USA and Europe. Regular scrutinizes are to be held in order to check the accomplishing of all the conditions stipulated in Contract for Difference.
Both MGT Power and Macquarie authorities commented on their agreement. Ben Elsworth, CEO of MGT Power, said that Macquarie's support means further advancement for their project and it's making their aim of starting construction by early 2016 a possible prospect. Mark Dooley on behalf of Macquarie emphasized the potential of the project, as it is one of the first projects of renewable energy concept to be constructed under UK CfD program and the biggest biomass plant in the UK. So some challenges may occur but it is a very perspective field for the finance market.
Macquarie Group limited – global investing company, which provides investment, advisory and management services with headquarters in Sydney.
MGT Power – an independent UK company dealing with large-scale projects on renewable fuel sources and sustainable forestry.
