MITIE secures £36m funding for one of UK’s largest NHS energy centres
25 March 2013
MITIE, the FTSE 250 strategic outsourcing company, has helped secure £36 million funding for a new energy innovation centre for Cambridge University Hospitals NHS Foundation Trust.
It has also been announced today that the centre – which will save £20 million in energy costs and 25,000 tonnes of CO2 over the 25 year contract term – will be developed and operated by MITIE.
The new energy innovation centre will serve Addenbrooke’s and Rosie hospitals and is expected to be one of the largest energy centres in the UK.
In a ground breaking transaction, Aviva Investors and the UK Green Investment Bank, the first bank of its kind in the world, will provide approximately £36 million of funding for the development of the new energy innovation centre.
Ruby McGregor-Smith CBE, Chief Executive of MITIE, said: “This will be an advanced energy centre which demonstrates the economic and environmental value of local energy generation.
“We are delighted that the Green Investment Bank and Aviva Investors are providing the funding for this project. This underlines the huge potential opportunity decentralised energy projects offer for long-term investors.”
The funding is being provided by Aviva Investors, through its REaLM Infrastructure Fund, and GIB, through today’s investment in the Aviva Investors REaLM Energy Centres Fund.
GIB’s share of this investment will be approximately £18 million with the Aviva Investors REaLM Infrastructure Fund, providing the balance of the investment.
Ian Berry, Fund Manager, Infrastructure & Renewable Energy at Aviva Investors, said: “The development of UK energy centres is a very exciting new area for long-term investors such as pension funds. They can achieve stable, diversified and relatively low risk income streams, while also helping to fund important infrastructure projects that deliver long term savings and sustainability benefits to their clients.
“This is a landmark transaction and demonstrates how private sector know-how and pension fund money can be used alongside government funds to finance innovative infrastructure initiatives, and the ongoing development of renewable energy and energy efficiency projects in the UK.”
UK Green Investment Bank Chairman, Lord Smith of Kelvin, said: “Non-domestic energy efficiency is a priority sector for the Green Investment Bank, and this deal is an early demonstration of our strategy to partner with co-investors and deliver a commercial return to the bank, whilst reducing carbon emissions in the UK.”
The new centre will house a combined heat and power unit, biomass boiler and efficient dual fuel boilers, as well as heat recovery from medical incineration.
As an alternative to sourcing power from the National Grid, the Trust will benefit from the energy centre’s materially lower energy costs and carbon emissions. The project is subject to final planning approval.
Combined heat and power generation produced by energy centres captures excess heat, potentially enabling efficiencies in excess of 80% to be reached compared to less than 60% for standard gas power generation.
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