Active Energy Group Plc / EPIC: AEG / Sector: Alternative Energy
15 October 2018
Active Energy Group Plc ('Active Energy', 'AEG', the 'Company' or the 'Group')
Joint Venture Agreement with Georgia Renewable Power LLC
Active Energy, the London quoted international biomass based renewable energy and forestry management business, is pleased to announce that it has entered into a joint venture agreement to instal CoalSwitch facilities with Georgia Renewable Power LLC ("GRP"), a US company that maintains three biomass-to-energy power plants located in North Carolina and under construction in Georgia, U.S., with a total power generation capacity of approximately 165 Megawatts (MW).
Overview
· Under a Joint Venture Agreement (the "JV") Active Energy Renewable Power LLC has been incorporated to advance the commercial development of CoalSwitch™ fuel into operational power plants, develop organic waste fertilizer products and utilise the Company's existing CoalSwitch™ and PeatSwitch™ technologies for complementary sales of biomass
· JV will leverage the significant synergies between GRP and AEG's businesses including GRP's established steam and drying infrastructure at its power plants and allow AEG access to its surplus biomass feedstock
· JV intends to evaluate the potential of new feedstock constituents for CoalSwitch™ including poultry litter - to create a new product, LitterSwitch™
· Initial CoalSwitch™ plant to be installed at GRP's existing power plant facilities at Lumberton, North Carolina, before the end of 2018, followed by the two additional plants in Georgia over 36 months
· The JV intends to install up to 100 tonnes per hour of CoalSwitch™ production facilities
· AEG is currently negotiating off take agreements for the sales of both CoalSwitch™ and biomass sourced from existing GRP facilities
Joint Venture - Active Energy Renewable Power LLC
Active Energy Renewable Power LLC has been incorporated in North Carolina for the purposes of the JV and is owned equally between the Group and GRP. The JV will install CoalSwitch™ manufacturing facilities at each of GRP's biomass-to- energy power plant sites in North Carolina and Georgia.
The first installation will be at Lumberton in North Carolina. The plant will utilise some existing facilities and equipment currently owned by AEG at its site in Utah. The intention is to commence work immediately with the aim to have commercial production facilities installed by the end of Q4 2018. The installation will be assisted by the use of GRP's existing steam and drying capacity at its power plants. In addition, the JV will be able to take advantage of GRP's existing infrastructure for feedstock procurement. The JV intends to double the production of CoalSwitch™ at this facility to 10 tonnes per hour during H1 2019.
Following the initial installation of this CoalSwitch™ plant, the JV intends to build two additional CoalSwitch™ facilities at each of GRP's other biomass-to-energy power plant locations in Carnesville, Georgia and Colbert, Georgia. Each of these plants are currently under construction and are targeted to be commissioned by mid-2019 and the JV intends to install 25 tonne per hour CoalSwitch™ facilities at each site in the coming 36 months. The JV aims to expand the Company's CoalSwitch™ production capacity up to 100 tonnes per hour in the region, dependent on feedstock availability and market opportunity.
The JV also intends to work on a number of additional projects. The JV is looking to further develop the CoalSwitch™ product to include the creation of LitterSwitch™ pellets (a beneficiated pelletised fuel derived from poultry litter). A research and development programme is being developed for this. Further, the JV will look at the creation of additional products including fertilizers based on Peatswitch™ organic matrix and technology along with inert by-products from the biomass power plants and mineral rich by-products from the CoalSwitch™ process.
Finally, the JV will develop a commercial market, through AEG, for high density baled dry wood chips, meeting the specifications required by the EU regulations for the import of wood products, and other biomass products such as dried bedding chips, developed by GRP.
The JV will use for this scope GRP's drying facilities, effectively recovering the waste heat from the power plants and greatly reducing the carbon footprint of the production chain.
Michael Rowan, Chief Executive of Active Energy, said, "This is an important development for Active Energy, which we believe will result in a significant increase in CoalSwitch™ and PeatSwitch™ production capacity in the US, the diversification of AEG's activities in terms of both geography and feedstock, and additional revenue streams through biomass trading.
"This agreement will shorten the time scales for large scale commercialisation of our CoalSwitch™ and PeatSwitch™ products and will also allow AEG to benefit from the experience and the presence of our partner GRP, thus strengthening our capabilities in the next operational phase of our business plan.
"We are delighted to be working with the GRP team who have been instrumental in the commercialisation and adoption of biomass-to-energy power generation in south-east U.S. We believe the clear synergies between GRP's business and ours make a compelling proposition and together we look forward to leveraging the benefits of our unique CoalSwitch™ and PeatSwitch™ technologies to develop into new markets.
"In particular, the environmental and health hazards associated with poultry litter have been well documented, and the opportunity to apply our revolutionary and proprietary technology to harness and remove the damaging characteristics of this substance and produce a carbon neutral and low emission fuel, is particularly exciting and will, I believe, have global appeal.
"I look forward to providing further updates as we install the first CoalSwitch™ plant at GRP's Lumberton facility in North Carolina in the coming weeks."
Dave Schafer, Chief Operating Officer of GRP, said, "I am very pleased to have concluded the joint venture with AEG and achieve the opportunity to participate in the commercialisation of both the CoalSwitch™ and PeatSwitch™ programmes. I believe that the JV has the potential to make a significant impact both in the US and internationally as commercial quantities of both CoalSwitch™ and PeatSwitch™ become available. The programme for research and development into LitterSwitch™ also could provide tremendous market opportunities."
Further Information
GRP currently owns and will operate three biomass-to-energy power plants located in Lumberton, North Carolina; Colbert, Georgia; and Carnesville, Georgia, (each a 'GRP Site") for a total installed power supply of around 165 MW.
Among other biomass fuels, the Lumberton power plant facility utilises poultry litter as a fuel source and GRP wishes to work with AEG through the JV to examine new biomass fuel opportunities using poultry litter and create LitterSwitch™.
GRP currently has access to fibre feedstock of up to 2 million tonnes per year, well in excess of its current internal consumption requirements. In addition, GRP has access to additional supplies of wood chips and process technology for the energy markets and is seeking with AEG through the JV to commercialise new revenue opportunities.
AEG has developed a proprietary process and technology, CoalSwitch™ and PeatSwitch™, to produce a fuel pellet and a carbon substrate for fertilizers.
AEG is seeking to deploy CoalSwitch™ and PeatSwitch™ production capacity in the USA and Canada for sales both in North America and internationally.
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.
**ENDS**
Enquiries& Further Information:
Enquiries |
Active Energy Group Plc |
Michael Rowan Chief Executive Officer (Active Energy) |
[email protected] |
Northland Capital Partners Limited Nominated Adviser |
David Hignell / Gerry Beaney |
Office: +44 (0)20 3861 6625 |
Optiva Securities Ltd Broker |
Graeme Dickson / Ed McDermott |
Office: +44 (0)20 3137 1902 |
St Brides Partners Financial PR Adviser |
Susie Geliher / Isabel de Salis |
[email protected] Office: +44 (0) 20 7236 1177 |
About Active Energy Group:
Active Energy Group Plc (AIM: AEG) is a London Stock Exchange-listed international renewable energy business based upon forestry assets. Its model is focussed on capturing the entire forestry value chain through sourcing, utilising and commercialising assets, and setting a new standard in the sustainable management and optimisation of timber resources.
The Company is led by a highly technical and commercial team with the experience to execute its defined growth strategy and build its visibility, primarily as a London-listed timber opportunity with a revolutionary biomass fuel technology.
