Danish Investment Fund Acquires $208m, Biomass Fired, UK CHP Power Plant

The fund Copenhagen Infrastructure II and Burmeister & Wain Scandinavian Contractor A/S (BWSC) have acquired 100% of the biomass-fired combined heat and power plant project Kent in the UK developed by Estover Energy Ltd and at the same time taken the investment decision to construct the project. The total investment in the Kent project will amount to approximately $208m.

The Kent biomass power plant will have a capacity of 27.8 MW and will be fired primarily with virgin wood sourced locally in the UK. The power plant is expected to be in operation during the summer of 2018. The power plant will be constructed by BWSC which is also the business partner of Copenhagen Infrastructure Partners (CIP) on two other biomass plants in the UK. BWSC will furthermore be responsible for operation and maintenance of the plant under an O&M contract for up to 20 years.

The plant will be able to produce power corresponding to the power consumption of 50,000 households. Heat and some of the power will be delivered to Discovery Park. Discovery Park is one of the UK’s leading science parks located in Sandwich, Kent, a global hub for science, technology, business and enterprise. The entire biomass required will be sourced under a long-term contract with Euroforest, one of the largest virgin wood suppliers in the UK. The plant will deliver CO2 savings of approximately 100,000 tonnes every year.

The project is located in Kent near Sandwich in the UK and has been developed by Estover Energy Ltd. The total investment in Kent amounts to approximately $208m/£160m of which Copenhagen Infrastructure II K/S will invest around 80% and BWSC around 20%. Estover Energy Ltd will once commercial operation commences hold a minority interest in the project.

“Our investment in Kent builds on our good experience with the UK biomass power market which to date includes the Brigg project which was commissioned in January 2016 and the Snetterton and Templeborough projects that are under construction and planned to be commissioned in 2017. The Kent project presents an attractive investment opportunity for CIP in a country with a well-established and stable regulatory regime. The investment is aligned with our strategy of developing projects benefitting from long-term contracts with strong industrial partners in order to deliver stable returns for our investors”, says Christina Grumstrup Sørensen, Senior Partner in CIP.

“The Kent project is BWSC’s eighth turnkey biomass power plant project in the UK within the last 5 years, and it underlines our strong position on the UK renewable energy market. The project also illustrates the value of the close cooperation between strong financial and industrial players in the energy sector resulting in attractive business opportunities and investments for both parties. With the Kent project, BWSC has once again strengthened its role as market leader within constructing, operating and owning energy efficient power plants”, says Anders Heine Jensen, CEO in BWSC.

Copenhagen Infrastructure Partners K/S (CIP) is a fund management company founded in 2012 by senior executives from the energy industry and PensionDanmark. CIP is owned and managed by the five partners, Jakob Baruël Poulsen, Rune Bro Róin, Torsten Lodberg Smed, Christian T. Skakkebæk and Christina Grumstrup Sørensen. All five partners have extensive experience within infrastructure investments and mergers & acquisitions.

Burmeister & Wain Scandinavian Contractor A/S (BWSC) is a Danish engineering and contracting company which develops, builds, operates and owns high-performance biomass, biogas and engine based power plants. The majority of the projects are supplied as turnkey plants, and BWSC has delivered more than 178 power plants to 53 countries worldwide with a total capacity of more than 3,500 MW. Currently, BWSC has ongoing construction and O&M activities in England, Northern Ireland, Surinam, Lebanon, Sri Lanka, Kenya and Mauritius. BWSC generated a revenue of DKK 2.1bn in 2015, and the order book amounted to DKK 6.6bn at end-2015 and has more than quadrupled in the last 4 years. BWSC originates from the stationary engine division of Burmeister & Wain (B&W), which has built and installed diesel engines for power plants since 1904.

Photo: Kent Biomass Combined Heat And Power CHP Power Plant. courtesy of BWSW.

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