Renewables sector receives a £150m vote of confidence

ONE of Europe’s largest energy funds has secured a £150m refinancing of a Lincolnshire biomass power plant, in what it views as a major vote of confidence in Britain’s renewable energy industry.

Glennmont Partners, formerly BNP Paribas Clean Energy Partners, said the institution-only refinancing of Sleaford Biomass Plant is the largest of its kind in the sector to date.

The transaction underlines a strong appetite for stable returns from renewables which have avoided the volatile conditions elsewhere in the energy industry by tapping Government subsidy schemes to drive costs lower.

The Sleaford deal was arranged by Deutsche Bank and falls only slightly short of the £165m that Glennmont paid to buy the straw-burning power plant from its developer, Eco2, in 2012.

Since then, the 40-megawatt plant has received government subsidies to generate electricity while piping the heat created at the plant into a community district heating scheme nearby.

Joost Bergsma, Glennmont’s chief executive, said the deal is consistent with the fund’s aim to build portfolios of renewable power projects to provide predictable returns for its clients.