Law firm helps on second pioneering green power scheme
28th March 2013
LAW firm Ward Hadaway has advised on the second in a series of pioneering green power developments across the North.
The UK Top 100 firm has advised renewable energy company JFS & Associates on the latest in its series of joint ventures with farmers to install and build anaerobic digestion (AD) plants to generate green energy.
The first of these pioneering developments was set up at a farm in Ponsonby in West Cumbria towards the end of last year.
An agreement has now been reached to build an AD plant at Howla Hay Farm in Guisborough, North Yorkshire. Under their ‘Develop. Own and Operate’ model, JFS have secured all of the necessary permits and permissions for the site, and developed the project to a position whereby it is ‘ready to fund’.
They then formed a Joint Venture (JFS Howla Hay Biogas Ltd.) with the farmer, with JFS securing the entire project funding through their investment partners Iona Capital VCT, CO2 Sense and Blue Bell Global. Howla Hay Farm will then be responsible for operating the plant, including supplying all the feedstock from existing farm wastes such as manure and slurry, supplemented with energy crops.
The joint venture will generate renewable electricity from the anaerobic digestion process, receiving income under the Feed in Tariff Scheme, with the electricity being used on the farm or sold to the National Grid.
Howla Hay Farm will then get a percentage of the income generated through the energy sales, as well as dividends from their shareholding and will be able to use the Digestate by-product of the AD process as environmentally-friendly Bio-Fertiliser.
The plant being built at Howla Hay Farm will be capable of generating 250kWh of electricity – enough to power 250 homes.
Matthew Flint, director at JFS & Associates, which is based in Stokesley, North Yorkshire, said: “It is great news to be able to announce the second in what we aim to be a whole series of these developments which provide a real win-win for both parties in the joint venture.
“The farmer gets to share in the proceeds of the electricity generated – opening up a new revenue stream – as well as getting the benefit of the by-products of the process, such as heat and Bio-Fertiliser to further improve the profitability of their existing business.
“We get a readily available source of feedstock for the AD plants and, by using our expertise and experience in the renewable energy sector, we can generate and sell electricity to feed back into the National Grid.”
Further joint ventures to develop AD plants on other farms across the North are currently in the pipeline.
Mark Whitehead, Partner and Head of Energy and Utilities at Ward Hadaway, led the firm’s team advising JFS & Associates on the deal.
Mark said: “Matthew and the team at JFS & Associates have spotted a real niche in the energy market and are using their considerable skill and know-how to bring their ideas into fruition.
“These joint ventures require a high level of co-operation and understanding between the various parties involved so we have been using our experience and expertise at managing complex projects to ensure that everything comes together at the right time.
“We are delighted to have concluded this second joint venture for JFS & Associates and look forward to continuing to work with them going forward.”
Matthew Flint said: “Once again, Mark and his team at Ward Hadaway have done a great job in managing the various relationships and putting the right structures and agreements in place to ensure we can continue to go forward with this scheme.”
The AD plants are built on site by Newcastle-based Surgo Construction, in partnership with experienced German technology supplier PlanET Biogas, and each take around four months to build.
Once in place, the sealed units will harness biogas given off by the anaerobic digestion process to drive a Combined Heat and Power (CHP) engine, which generates electricity.
This is then sold to leading renewable energy buyer SmartestEnergy to feed into the National Grid.
Walker Morris provided legal advice to Iona Capital VCT and Blue Bell on the deal with CO2 Sense’s in-house legal team advising the renewable energy and environmental consultancy.