JLEN Environmental Assets acquires anaerobic digestion plant – JLEN Environmental Assets (JLEN) has acquired an anaerobic digestion plant and a associated waste collection business. It has bought a 70% stake in Bio Collectors Holdings (BCH). BCH, through its subsidiary companies holds the rights and operational assets that make up the anaerobic digestion (AD) plant and the Bio Collectors waste collections business. Terms of the consideration are made up of an initial upfront payment, including working capital, and additional deferred amounts that are subject to certain conditions being met.
JLEN notes that the group of companies is based in Merton, London. The AD plant was commissioned in December 2013 and has subsequently been expanded through several phases. The plant has a current thermal capacity of c.10MWth, a waste processing capacity of up to 100,000tpa and predominantly produces biomethane to be injected to the national gas grid. In addition, the plant has 1.7MWe of capacity through two CHP engines and is accredited under the Renewable Heat Incentive (RHI) and Feed-in-Tariff (FiT) schemes. The Bio Collectors waste collections business collects source-separated and packaged food waste for the AD plant from a variety of commercial, industrial and local authorities located in and around Greater London utilising an increasing biogas-powered fleet.
The 70% stake in BCH has been acquired from private individuals, with the residual 30% retained by the existing owner who will remain active in the business going forward. This acquisition represents JLEN’s first acquisition into food waste fuelled anaerobic digestion, increasing the total capacity of renewable energy assets held in the portfolio to 297.9MW. The acquisition was funded by a draw-down on JLEN’s revolving credit facility.
Richard Morse, chairman of JLEN, noted: “We are pleased with JLEN’s latest investment, which presents a diversification within the anaerobic digestion sector. This acquisition of a food waste fed AD plant in London, bridges two sub sectors of JLEN’s existing portfolio, leveraging experience of the agricultural AD assets and the waste processing assets. The production of biogas to inject into the national grid and also to power its own fleet of collection vehicles, underlines the importance that assets such as these play in the UK’s ambition to decarbonise its energy supply.”
JLEN’s investment policy is to invest in environmental infrastructure projects that have the benefit of long-term, predictable, wholly or partially inflation-linked cash flows supported by long-term contracts or stable regulatory frameworks.
Environmental Infrastructure is defined by the company as infrastructure projects that utilise natural or waste resources or support more environmentally-friendly approaches to economic activity. This could involve the generation of renewable energy (including solar, wind, hydropower and biomass technologies), the supply and treatment of water, the treatment and processing of waste, and projects that promote energy efficiency. JLEN’s aim is to provide investors with an annual dividend that is sustainable and increases in line with inflation. The target dividend for the year to 31 March 2020 is 6.66 pence per share. The dividend is payable quarterly.
JLEN: JLEN Environmental Assets acquires anaerobic digestion plant