SembCorp Utilities UK is to invest £36 million (US$72 million) in a new CHP project at the Wilton International site on Teeside in the northwest UK.
The company has signed an agreement with Aker Kvaerner Engineering Services Ltd to provide the engineering design, construction and commissioning work for the new plant, which will be based on combined cycle gas turbine technology.
The unit will be capable of generating 40 MWe, which will be used by a range of on-site customers, and will also supply up to 162 tonnes per hour of steam to the site distribution system.
The new project will supply the recently announced Ensus bio-ethanol plant and is SembCorp's third major investment in four years.
It follows a £20 million ($40 million) CHP plant also built by Aker Kvaerner at Wilton Power Station in 2004 and Wilton 10, the £62 million ($122 million) biomass-fuelled power station due to start operations later this year.
Work will start immediately and the CHP plant is expected to be operational by the end of 2008. Aker Kvaerner's contract is valued at £26 million ($54 million).