SSE to sell stake in West Yorkshire facilities for $1.29bn

14 October 2020 (Last Updated October 14th, 2020 13:16)

British energy company SSE has agreed to divest its 50% stake in the Ferrybridge and Skelton Grange waste-to-energy assets in England to European Diversified Infrastructure Fund III for £995m ($1.29bn) in cash.

SSE to sell stake in West Yorkshire facilities for $1.29bn
SSE agrees to sell 50% stake in Ferrybridge and Skelton Grange assets. Credit: SSE.

British energy company SSE has agreed to divest its 50% stake in the Ferrybridge and Skelton Grange waste-to-energy assets in England to European Diversified Infrastructure Fund III for £995m ($1.29bn) in cash.

Located in West Yorkshire, the facilities convert residual residential, commercial and industrial waste into renewable energy.

The holding companies that SSE has agreed to sell stake are energy-from-waste ventures Multifuel Energy (MEL1) and Multifuel Energy 2 (MEL2).

Both MEL1 and MEL2 assets are 50:50 joint ventures (JVs) between SSE and US-based waste management company Wheelabrator Technologies.

They comprise the operational Ferrybridge Multifuel 1 and Ferrybridge Multifuel 2 facilities, each having a capacity of 75MW and the Skelton Grange Multifuel development project.

SSE finance director Gregor Alexander said: “This sale marks a major step in our plans to secure at least £2bn ($2.6bn) from disposals by autumn 2021, with just over £1.4bn ($1.8bn) now delivered.

“While these multifuel assets have been successful ventures for SSE, they are non-core investments and we are pleased to have agreed a sale that delivers significant value for shareholders while sharpening our strategic focus on our core low-carbon businesses.

“Our disposal programme demonstrates how the company can create value from our assets and supports our plans to invest £7.5bn ($9.7bn) over the next five years in the low-carbon infrastructure needed to stimulate a green economic recovery and help the UK transition to a net-zero future.”

Expected to be completed this year, the deal is dependent on securing antitrust approval from the European Commission (EC).

The company’s latest move follows the sale of 25.1% non-operating stake in Walney offshore wind farm to renewable infrastructure fund Greencoat UK Wind for $468m (£350m).

In August, SSE Renewables ordered 443MW of capacity from Danish wind turbine manufacturer Vestas for the Viking Wind Farm in Shetland, UK.