Case Studies

In 2013, Greensphere invested in a 14.7MW biomass-fired power plant and sustainable forestry and fuel processing platform, Western Forestry and Energy (WFE), located in Port Talbot, Wales. The investment reflects Greensphere’s commitment to pursuing transformative projects that provide value for shareholders as well as mitigate climate stress and resource scarcity.

Ancillary fuel processing, fuel trading and forestry activities have been developed within the WFE group in separate companies to secure a circular, local and resilient supply chain for the plant.

Since purchasing the facility, Greensphere has enacted significant cost savings and management improvement exercises, resulting in reduced operational risk and an improved sustainability profile. This includes the creation of a creditworthy bespoke financing facility, replacing the Operations & Management provider, establishing a third-party forestry and chipping services business and bringing fuel processing and purchasing expertise in-house through the hiring of an excellent management team.

Applying its investment and operational experience, Greensphere also identified an opportunity improve the plant’s feedstock position. The group’s management team now works closely with Natural Resources Wales – the government body overseeing the use, maintenance and enhancement of the Wales’ natural resources – by engaging with its network of harvesters to develop more efficient and sustainable forestry practices that improve the quality and consistency of feedstock.

WFE is an example of how Greensphere has the expertise to manage assets through difficult and sometimes quickly changing landscapes – a skill-set that is critical for an asset manager pursuing a buy-to-hold portfolio strategy. Greensphere has managed WFE through a challenging macroeconomic and operational environment. In 2014 and 2015, sharp and unprecedented fall in UK power prices coupled with difficult financial implications of changes in policy (due to a sharply changing political landscape) resulted in significant pressure on earnings. Greensphere responded with thoughtful cost-savings plans as well as re-negotiating major contracts (for example with the plant’s with the PPA provider) that helped to mitigate the impact of these macroeconomic conditions.

WFE and its underlying assets constitute the first commercial-scale power station of its kind in Wales as well as a unique eco-system of supply and forestry management. Construction of the plant started in October 2006 and full commercial operations began in November 2008. The plant, which positively contributes to reducing greenhouse gas emissions, burns approximately 160,000 tonnes a year of sustainable forest management waste and generates enough electricity to power the equivalent of approximately 31,000 homes.

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