Reserve power operator MAST Energy Developments has greenlit its first UK plant, the 9 MW gas-fired generator at Pyebridge, near Alfreton, Derbyshire, ready to secure PPA revenues plus Capacity Market income.
MAST bought the stand-by project in August, lining up Statkraft as offtaker.
MAST’s deal with the Norwegians runs for ten years, with an option to review. It includes a guaranteed floor off-take for a period just short of eight years, thereby de-risking the project’s investment case.
Announcing the proposed deal to shareholders over the summer, MAST calculated it would contribute £488,000 per year at the EBITDA level.
That forecast has now received early confirmation, in the form of Pyebridge’s 15 year Capacity Market contract worth £60,000 per year, starting last month. The firm says this provides £900,000 before upward inflation adjustment, calculated against the Retail Price Index. Pyebridge’s optimised Internal Rate of Return (“IRR”) is now revised to 21%.
MAST is 55%-owned by Kibo Energy. Louis Coetzee, MAST’s non-executive chair and CEO of Kibo, said:
“Commercialising Pyebridge as our first fully operational site is a landmark next step towards the much larger portfolio of 300 MW that we are aiming to establish in the UK. Additional prospective sites are being continuously added.
“We are also looking forward to the completion of construction and commissioning of Bordesley and Rochdale as stated in earlier announcements and to the additional revenue flow from these sites in the first half of 2022.”
As Norway’s state-owned generator-retailer, Statkraft is reputedly Europe’s biggest generator of renewable power, as well as a major operator of district heat networks. Its planned or operating projects in the UK embrace onshore Scots wind and storage ventures including Feckenham in Staffordshire.