AmeyCespa has signed a Power Purchase Agreement (PPA) with GDF SUEZ Energy UK for the output from Allerton Waste Recovery Park (pictured artist impression) , its major new energy-from-waste facility in North Yorkshire.
Under the agreement, GDF SUEZ Energy UK will buy all of the electricity generated by Allerton Waste Recovery Park, which will process around 320,000 tonnes of household and some commercial waste each year.
The energy generated will be enough to power around 40,000 homes per year with electricity.
The plant is expected to be operational by early 2017, with GDF SUEZ Energy UK contracted to buy up to 208GWh of electricity annually.
Shaun Kingsbury, UK Green Investment Bank – “This innovative project is a best-in-class example of how local authorities can improve recycling and generate significant amounts of renewable power from household waste”
Power purchase agreements are essential to the viability of any new renewable energy plant. Banks and other funding providers for major renewable projects need to be assured that the money they invest will be repaid through the sale of energy to a reliable, experienced and creditworthy offtaker.
Under the PPA, GDF SUEZ Energy UK will buy the output from Allerton Waste Recovery Park at an index-linked rate, providing AmeyCespa with a market-reflective price for its energy. To provide an assured return on investment for the project’s funders, the PPA also incorporates a floor price, guaranteeing a minimum rate should market prices fall steeply.
Once completed, Allerton Waste Recovery Park will divert around 95% of York and North Yorkshire’s household waste from landfill. As well as the environmental benefits this will bring, the anticipated long-term savings on the cost of waste treatment are expected to be around £250m over the life of the contract.
In February 2013 the Allerton project was among those whose PFI credits were pulled by Defra (See CIWM Journal Online story).
In November last year the Green Investment Bank UK made a £33.1m investment into the Allerton plant.
It is GIB’s first waste investment to feature such an extensive range of waste treatments and advanced technology.
The new treatment plant will enable value to be recovered from almost every aspect of North Yorkshire County Council and City of York Council’s waste, including:
- mechanical treatment facility that will recover metal, paper and plastic for recycling
- onsite anaerobic digestion plant to treat organic waste which will generate around 8 GWh of renewable electricity per year
- energy-from-waste facility that will produce steam to feed an electricity generating turbine, generating 203 GWh of electricity – enough to supply the equivalent of more than 40,000 homes.
More than 400 jobs are expected to be created during the construction process and an additional 70 when Allerton Waste Recovery Park becomes operational.
Shaun Kingsbury, chief executive, UK Green Investment Bank, said: “This innovative project is a best-in-class example of how local authorities can improve recycling and generate significant amounts of renewable power from household waste. GIB is proud of its track record supporting innovation in the waste and recycling sector and particularly pleased that this impressive facility is the first to feature the full complement of waste treatments and new technologies.”