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Privilege Finance, Investec Bank partner to boost AD projects

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Privilege Finance and Investec Bank have announced a long-term partnership that will release up to £90 million (€105 million) worth of funds for UK climate change projects.

The funding will be offered to existing anaerobic digestion (AD) customers to refinance their projects as they hit operations, providing interest savings to borrowers and freeing up Privilege’s capital to be reinvested, accelerating the deployment of new funding for new climate change projects.

Launched in 2001, Privilege has deployed more than £500 million (€587 million) to build 40 AD facilities. These generate a combination of renewable electricity, heat, and biomethane to produce over 3.5 GW of energy per day.

Investec’s Power and Infrastructure Finance team has, in the past five years, arranged or advised on more than £1 billion (€1.17 billion) of funding for bioenergy projects including financing several AD portfolios.

“By using the funds from Investec to refinance projects after the initial project finance phase, Privilege Finance will be able to redeploy the money to allow investment in additional renewable energy of carbon reduction projects,” said Stefan Rattensperger, senior director at Investec.

“For end borrowers, it means they will move to a lower rate of interest while continuing to be supported by Privilege Finance’s team, who know and understand their facility.”

Andrew Vernau, chief financial officer at Privilege, commented: “The coming together of two experienced players in the renewable energy arena with 20 years of combined experience in AD finance and a shared vision to turn the tables on climate change promises to accelerate the growth of new AD projects and their contribution towards driving down carbon emissions.

“AD technology is proven and well-established, but mainstream banks still view it as a relatively new concept in the wider renewables sector.

“It is, therefore, incredibly encouraging to see it supported by a major financial institution like Investec, which understands the reliability of the technology and has successfully structured and arranged financings in the sector.”