Work is to start immediately on a new biofuelled combined heat and power (CHP) plant to supply Stockholm with electricity and district heating with a EUR500m investment from Fortum (OMX: FUM1V).

The project fits with Fortum’s strategy on focusing on CHP, said Anders Egelrud, managing director of Fortum Värme, the company’s heat business in Sweden.

Vartan‘CHP technology improves resource efficiency since it enables as much as 90% of the energy content in the fuel to be utilized,’ he said.

Fortum aims to achieve carbon-neutral district heating across Stockholm and is also building a waste-fired unit at the Brista CHP plant in the north of the city.

With a capacity of 280 MW heat and 130 MW electricity, the new biomass plant at Värtan Strait will replace existing heat production and raise Fortum Värme’s electricity output by a third.

The plant is due online in 2016.

Advanced fluidized bed boiler technology will enable the plant to burn a range of forest fuel, further reducing costs.

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