16 August 2002

Rescue moves for wood energy plant

SELBY MP John Grogan is seeking meetings with government ministers to see if assistance can be provided to revive the flagging fortunes of Europes first wood-powered energy station.

A total of £1.5m has already been pledged by the EU to try and save the ARBRE energy plant in Eggborough, near Selby, North Yorkshire after it went into voluntary liquidation last week. The EU has already pumped in £10m of grant aid since the project was set up in 1998.

Mr Grogan told FARMERS WEEKLY that the future of the plant may be out of official hands. Energy Power Resources (EPR), which bought the plant in May, inherited some debts along with the acquisition from the Kelda Group in May. That makes it the preferred creditor.

"EPR seems determined to put the project into voluntary liquidation and it is in a very strong position to dictate what will happen," he said. "I do not really see what the Government can do, although I am trying to arrange a meeting with energy minister, Brian Wilson and with Margaret Beckett."

But he added: "One way out is if the EU says it will claim back the grant aid if the project fails. That would make EPR more willing to put it into the hands of another buyer."

Mr Grogan said a Swedish company with a 10% stake in ARBRE was also currently trying to put together a rescue package with the assistance of its own government. But that would take time and it could be too late. Everything would depend on the outcome of a creditors meeting scheduled for Monday (Aug 19), he added. &#42