Green Investment Bank publishes market report on anaerobic digestion

The UK Green Investment Bank (GIB) has today published its first market report on anaerobic digestion (AD).

The report gives an overview of the issues facing the market and identifies the opportunities, and barriers, for investment.The findings of the report will be used to inform GIB’s strategy on the potential for debt investment in the AD sector as well as being a useful resource for the industry and investment community. GIB is actively investigating the opportunity to directly participate in up to £50mn of debt financing for AD projects.

Government research has indicated that AD could deliver between 3 and 5 TWh of electricity by 2020. However, the industry has expressed concerns about its ability to access funding, in particular senior debt finance. GIB expects AD to be an area of significant focus for it.

Adrian Judge, managing director for Waste and Bioenergy, said: “AD is rightly at the heart of the government’s waste policies, and GIB’s waste investment strategy. It provides a green and efficient way of managing waste, whilst providing both energy and fertiliser. For organic waste, AD is a cost-effective and sustainable waste management option.

“Although the UK market is still young and there are challenges for projects in delivering a consistent revenue stream, well operated AD facilities have the potential to achieve attractive commercial rates of return to both equity and debt providers.”