UKGI makes first investment in waste sector

The facility at the London Sustainable Industries Park at Dagenham Dock, once built, will feature Londons first anaerobic digestion (AD) plant as well as in-vessel composting (IVC) technology, capable of handling 49,000 tonnes of food and green waste every year.

The 21 million funding for the development will come from a variety of sources. 2 million is being invested by UK Waste Resources and Energy Investments (UKWREI), which is managed by equity investor Foresight on behalf of UKGI. In April 2012, UKGI committed 80 million to Foresight and another waste fund manager to invest in small waste infrastructure (see letsrecycle.com story).

The development of waste infrastructure was identified as a priority sector for investment by UKGI, which was set up within BIS to make investments while the Green Investment Bank awaits State Aid approval (see letsrecycle.com story). UK GIB is expected to be operational at the end of the year.

Foresight has also committed a further 9 million through its environmental fund, with an additional 2 million of private sector funding coming from Luxembourg-based Quercus Assets Selection SCA SICAV-SIF. In addition, 7.9 million of senior debt is being provided by the London Waste and Recycling Board (LWaRB) and Investec Bank plc.

Investment

Commenting on the project, business secretary Vince Cable said: This project represents the first waste investment in the run up to the establishment of the UK Green Investment Bank, and sends a clear message to the market and to potential co-investors that we are committed to investing in the UKs green infrastructure.

Mayor of London, Boris Johnson, added: ‘It is also good news that TEG becomes London’s first anaerobic digestion plant providing an innovative, environmentally friendly way to manage the city’s waste, helping to cut down on costly landfill.

“It sends a clear message to the market and to potential co-investors that we are committed to investing in the UKs green infrastructure.”

Vince Cable

Mr Johnson has committed over 10 million for infrastructure development on the 60 acre London Sustainable Industries Park, where the facilities will be situated.

Facility

The AD plant will have the capacity to handle 30,000 tonnes of organic waste per annum, generating approximately 1.4 megawatts of electricity. The energy will be used by other tenants in the Park. The IVC will handle 19,000 tonnes per annum.

The facilities will produce over 36,000 tonnes of digestate and 14,000 tonnes of compost per annum for agricultural use.

Feedstock for the plants will come from source segregated food waste and mixed food and green waste produced by local households, commercial and manufacturing enterprises. TEG confirmed that is has some contracts for feedstock in place, but said it would not be releasing details of these at this time.

Discussing the benefits of the technology, Mick Fishwick, chief executive of TEG Group, said: Combined AD and IVC sites offer front-end flexibility on feedstock, enabling us to process a wide variety of waste streams including food waste only, green waste only or co-mingled organic waste. In addition, they produce natural organic fertiliser for use on the land and also valuable energy from waste which is fed into the National Grid. We are looking forward to starting work at Dagenham later this summer to provide this valuable service in London by early 2014.

Mr Fishwick said TEG’s first co-located AD and IVC plant in Perthshire, which became operational earlier this year, is testimony to the firm’s confidence in the technologies.

TEG said work is due to commence on the facility in September 2012.