£200m Energy Works scheme gets a kickstart

ENGINEERING firm Spencer Group is planning on forging ahead with its £200m Energy Works power plant in Hull after signing a funding deal .

Construction contracts have also been signed for the “green energy” power plant, so that work can begin in January 2016.

“A development of this scale and complexity naturally poses many challenges and all those involved are to be congratulated for their commitment and perseverance in taking the project through to this point,” said Charlie Spencer OBE, founder and executive chairman of Spencer Group and chairman of Energy Works.

Engineering and construction company M+W Group has been contracted for scheme,which has received a grant of almost £20m from the European Regional Development Fund.

The plant, which is predicted to provide 25MW of net power output, is due to be completed in January 2018.

Three equity partners; the Bioenergy Infrastructure Group, a power producer that invests in biomass and energy from waste plants in the UK; Israeli investment group Noy Fund and John Hancock, through its affiliate Hancock Natural Resource Group will fund the development.

Spencer will remain a shareholder in the business, and carry out cicil works as well as managing the construction phase.

The company says it will be the largest facility of its kind in the UK and the first advanced gasification power plant supported by the Government’s Contracts for Difference (CfD) framework, which is meant to stimulate investment in green energy developments to achieve targets for carbon reduction.

The CfD arrangement ensures a guaranteed price for the renewable energy produced by Energy Works and exported into the National Grid, up to 2033.

Full planning permission has been granted for the 348,480 sq ft Energy Works site on Cleveland Street, Hull, which will generate renewable electricity from domestic and commercial refuse-derived fuel using a recovery process called fluidised bed gasification.

It will generate sufficient electricity to power 43,000 homes and stimulate the economy, creating around 30 permanent positions once Energy Works is operational.

Charlie Spencer, chairman of Energy Works, said: “We are delighted to have reached financial close and to have agreed a contract for the construction of Energy Works, which will enable us to move into the delivery phase of this pioneering development.

“We are very pleased to have assembled an impressive group of partners to fund and deliver Energy Works, enabling us to establish a facility with outstanding green credentials in our home city, which is becoming recognised as the UK’s leading centre for renewable technologies.”

Neil Bennett, director for M+W Group’s Global Energy Business Unit, said: “Energy Works will be the UK’s first major renewable energy project using Advanced Conversion Technology to reach financial close within the new CFD framework.

“Meeting the requirements of this subsidy regime was extremely challenging and I am therefore delighted that our solution is competitive, effective and bankable. We now look forward to delivering one of the UK’s most exciting and landmark renewable energy facilities.”