Iona Capital (“Iona”), a specialist investor in low carbon infrastructure has financed the construction and operations of a new 8.8MW anaerobic digestion plant located in Dumfries and Galloway.
The plant has pre-qualified under the Non-Domestic Renewable Heat Incentive (RHI). This tariff was introduced in 2011 to incentivize the uptake of renewable heat in industry and businesses. Biomethane injection to grid is making a significant contribution in meeting the Government’s renewable heat targets.
The principal feedstock will be waste slurries generated from local dairy and beef farming operations, underpinning the plant’s compliance with OFGEM’s revised targets on sustainability.
The plant will have the capacity to generate 8.8MW of base load renewable energy. This is sufficient to heat circa 7,000 households on an annual basis. The plant is being built by Bioconstruct GmbH, one of the leading European AD equipment suppliers. The biomethane will be upgraded into the local gas distribution network, controlled by Scotia Gas Networks.
The UK has set ambitious targets for renewable energy – 20% of the country’s energy generation by 2020 should be “green” power. Since its launch in 2011, Iona has financed 21 renewable energy projects in England, Scotland and Wales, all of which supply energy to the local grid networks. This latest project follows on from two earlier successful Biomethane to Grid projects completed in Scotland at Keithick and St Boswells. The three plants will have a combined capacity in excess of 20 MW and provide significant operational synergies.
Iona Capital’s main investment focus is within the Anaerobic Digestion, Energy-from-Waste and CHP sectors, and its investors in its LP3 Fund include a number of local authority pension funds.
Nick Ross, Director of Iona Capital said: “Creating a sustainable energy sector is a top priority for the UK and Iona’ s bioenergy projects provide both attractive commercial returns to investors. And importantly supplies long term social and economic benefits to local communities and future generations.”