Climate change fund invests in biogas specialist

Investment

Climate Change Capital Private Equity, a €200m fund dedicated to clean technology, is making a £6 million investment in Renewable Zukunft Ltd, a specialist in the generation of electricity from organic materials.

The capital will enable Renewable Zukunft to partner with farmers and other commercial food organisations to develop anaerobic digestion plants. Each will be capable of producing and selling to the National Grid 10 million kilowatt-hours of electricity a year, enough to power 2,000 homes.

Climate Change Capital will take an undisclosed stake in the company and have a seat on the board.

Renewable Zukunft uses proprietary biogas technology developed in Austria, where it has been in use in twelve plants for a number of years. The company’s business model is to enter into joint ventures with agricultural and food processing businesses that will provide the feedstock for the biogas plants. The methane produced by the degradation of energy crops, manure and other organic waste materials is used to fuel combined heat and power generation units to produce electricity and heat.

Alex Betts, a partner at Climate Change Capital, said, “We are very pleased to have the opportunity to support Renewable Zukunft, which is addressing the high growth UK biogas market. They have a great value proposition for agricultural waste producers, a differentiated technology affording attractive returns on capital employed and a highly experienced professional management team.”

Renewable Zukunft’s managing director, Tim Evans, said: "This investment is great news for us. It underlines the strength of our business model and enables us to fund joint venture projects with third parties across the UK.

Evans added that the potential for biogas development in the UK is substantial. The biogas industry is at least 10 years behind the well developed markets of Germany and Austria. “We are keen to raise awareness and acceptance of this technology. Such a system can be used by local authorities for waste management, by agricultural businesses, food processors and retailers as well as by communities looking for self-sufficiency.”