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JLEN acquires CRED biomass CHP plant

In the United Kingdom (UK), JLEN Environmental Assets Group Ltd (JLEN), an environmental infrastructure investment fund has announced the acquisition of a 100 percent equity stake in Cramlington Renewable Energy Developments Ltd (CRED), which owns a 28 MW biomass-fired combined heat and power (CHP) plant and its underlying contracts. The acquisition of CRED, for an undisclosed amount, was made on a debt-free basis and represents JLEN's first investment into a large-scale biomass CHP plant.

Developed by Estover Energy Ltd and built by BWSC/BWE consortium the Cramlington Renewable Energy Developments (CRED) biomass-fired combined heat and power plant entered into operations in mid-2018 (photo courtesy BWSC).

The CRED CHP plant is located to the northwest of the town of Cramlington in Northumberland and utilizes proven technology to process a diversified woody biomass fuel mix, creating up to 28 MW of electrical power and 8 MW of heat for export to industrial customers and the grid.

The plant has been fully operational since 2018 and earns revenues from (i) the subsidy regimes of Renewable Obligations Certificates (ROCs) and Renewable Heat Incentive (RHI); (ii) the sale of electricity to the market; and (iii) the sale of heat and power via private wire to industrial customers.

In aggregate, approximately 66 percent of CRED’s revenues are backed by long-term subsidies and an additional 10 percent via long-term contracts. The acquisition is in line with JLEN’s strategy to further diversify its portfolio and to secure strong inflation-linked revenue streams.

We are happy to announce JLEN’s first investment into large-scale biomass CHP, which leverages the knowledge and experience gained in owning a number of bioenergy assets already. We believe that assets such as these provide a sustainable source of renewable heat and power that can be utilized as baseload power to the grid and a direct provision to nearby industrial customers. The plant has a strong operational track record and we look forward to optimizing this asset for the future, said Richard Morse, Chairman of JLEN.

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