Prestige Funds finances expansion of Devon Biogas Plant to bring power to 3750 homes
Prestige Funds, one of the leading providers of private finance to the UK’s agriculture, clean energy and SME markets, has closed a £4m deal to finance the expansion of an important biogas facility in Devon, England.
The finance being extended will fund the expansion of a gas to grid biogas plant which will provide over 3000 local homes with electricity. It will also see the plant’s production capacity ramped up to almost twice its current capacity.
The plant will receive food and animal waste from local businesses, which it can convert into electricity and it will start to receive waste directly from around October 2019.
Using its dedicated alternative investment credit funds, Prestige provides private finance from a diverse international, institutional investor base to fund key strategic biogas and other clean energy projects around the UK. Prestige uses a specialist private finance arranger, Privilege Development Finance, part of the same Prime group of companies, to manage its portfolio of loans to companies in the UK agricultural sector.
The expansion of the Devon plant comes at a time when many UK farms, businesses and municipalities are contemplating the eventual ban of waste ‘gate prices’. These are already outstripping inflation, making it increasingly expensive to dispose of food, crop, animal and other waste products through traditional means, including landfill.
Craig Reeves, founder of Prestige Funds and Prime, commented: “Businesses in the UK are facing higher and higher costs when it comes to waste disposal, yet anaerobic digestion plants, such as those funded by Prestige, represent a cost-effective way to channel waste into cheaper power for rural communities. Our investors are playing an important role in the battle to reduce greenhouse gas emissions AND control waste.”
Privilege Development Finance has now funded more than £90m of clean energy investment, representing approximately 14mw of new energy projects in the UK this year. This equates to enough power to run approximately 28,000 homes.
Favourable Macro Environment
According to the World Biogas Association, anaerobic digestion (AD) technology, which produces biogas via the treatment of waste, has the potential to reduce the world’s current greenhouse gas emissions by between 10-13%.
Apart from being used as a source of clean electricity in the UK, the digestate from biogas plants can be employed as a natural fertiliser that can replace expensive inorganic fertilisers which are often imported from overseas.
Rising electricity prices in the UK and higher taxes on landfill are causing agri businesses to turn to green energy projects as a source of on-farm energy, utilising existing waste. The UK government also needs to source more clean energy to meet its Paris Climate Change Agreement commitments.
In January 2019 the UK government announced plans to organise dedicated food waste distribution nationwide for the first time. Much of this will be used to power local AD plants. Universal food waste collections for households alone could achieve a carbon saving of up to 1.5 million tonnes of CO2 equivalent per year. This is the same as taking 750,000 cars off the road.