Major UK pension pool invests £40m in Sleaford biomass plant

A major UK pension pool has invested £40 million (€44 million) in Sleaford Renewable Energy Plant, a straw-fired biomass plant in Lincolnshire.

The transaction by Border to Coast Pensions Partnership, based in Leeds, marks its first co-investment made with Greencoat Capital, one of the UK’s largest investors in resource-efficient and renewable energy, for a minority stake in 39 MWe renewable combined heat and power (CHP) plant. Greencoat acquired the Sleaford plant in June 2020.

Sleaford Renewable Energy Plant uses a blend of locally sourced straw and sustainable woodchip to generate renewable power and heat, capable of generating electricity for 65,000 homes, saving 50,000 tonnes of CO2 per annum.

Located within the ‘Grain Belt’ in Lincolnshire, the plant provides a reliable route to market for straw. The facility also provides free heat to public buildings in Sleaford town centre, including a swimming pool, primary school, and the council offices.

“Sleaford Renewable Energy Plant is our first co-investment and marks a significant step forward for Border to Coast as an active alternative investor, reflecting the appetite of Partner Funds seeking predictable, secure income cash flows from renewable infrastructure assets,” said Daniel Booth, chief investment officer at Border to Coast.

“Projects like Sleaford will have a real impact in tackling climate change and underscores our, and our Partner Funds’, commitment to long-term sustainable investment while generating sustainable long-term investment returns.”

Minal Patel, partner at Greencoat, said: “Sleaford is a high-quality asset delivering predictable cashflows and significant inflation protection over the long-term, helping our clients meet their liabilities. It also plays an important role in the local area, supplying sustainable heat to local community facilities and providing arable farmers with a reliable offtake for their excess straw.”

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