£800m gas plant investors given Christmas deadline

Carlton Power was served with a termination notice by National Grid earlier this week after it missed a deadline to secure investment by 2 July.

But energy secretary Amber Rudd has given the developer until 16 December to ensure the project has more time to find financial backers.

In 2014, the plant was given a £30m-a-year subsidy for the next 15 years as part of the government’s first capacity market auction, which was subject to it getting a financial investment decision by 2 July.

The developer had already been given an extension until 26 September to find the backers after missing the 2 July deadline.

But the government has now extended this to 16 December.

Failure to find backers for the scheme will result in an £8.3m fine and the cancellation of its subsidy contract.

If the contract is cancelled the company would have to wait to enter the next available capacity market auction in December 2017, which could delay the scheme by years or cause it to be scrapped entirely.

Last month, Construction News reported that Carlton Power was in a race against time to secure financial backers for the 1.9 GW plant.

At the time, Carlton Power engineering manager Mark Pankhurst said the firm was still trying to “nail down” investors, but was “confident” of securing investment before the 2 July deadline.

Carlton Power told Construction News this week that negotiations were still “ongoing” with potential backers.

The Trafford plant is a crucial part of the government’s plans to build enough energy plants to power UK homes.

If built, the £800m plant would be one of the largest energy developments in the UK and could power more than 2.2m homes.

GE, Tecnicas Reunidas and Ferrovial Agroman were selected as the EPC contractors for the project in September 2014.

Construction was intended to start on the project last summer, but this was delayed after the developer struggled to find investors.

Mr Pankhurst said last month that the firm was still hopeful of the plant producing energy by October 2018.

Source link


Latest Issue

BDC 309 : Oct 2023