PensionDanmark, a leading Danish institutional investor, is to acquire a planned biomass power plant in Lincolnshire, England.

It is hoped that the 40 MW power plant could establish Eastern England as the straw-fuelled power hub of Europe.

Torben Möger Pedersen, chief executive of PensionDanmark, said the investment in Britain’s biomass-fuelled power sector was part of an overall plan to commit a tenth of its asset base, currently valued at $26bn, to renewable energy investments.

Danish engineering company Burmeister & Wain Scandinavian Contractor (BWSC) and PensionDanmark are set to acquire the 40 MW plant in a joint venture from UK-based renewable company Eco2 for £160m.

Following the operational commencement in early 2016, the straw-fuelled facility is estimated to produce power enough to fulfill electricity requirements of 70,000 households.

A similar state-of-the-art biomass plant developed by Eco2 at Sleaford is expected to begin generating power in September before becoming fully operational next year and is likely to consume 240,000 straw bales a year. Brigg is expected to begin producing for the grid by 2016.

Both power plants aim to exploit the large volume of dry stalk residue from cereal plants left over after separation from the grain and chaff produced in one of the bread baskets of England, according to the FT.

The successful rollout of the plant by the Danish joint venture could be the template for other straw-fuelled power projects in other areas of northwest Europe, said Mr Pedersen.

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