EQTEC (LON: EQT | FRA: KEU1) unveiled Monday it had acquired and intends to recommission a waste-to-energy plant in Italy, a plant powered by the company’s own technology.
The 1 megawatt electric plant was first commissioned in 2015 and “built around EQTEC’s proprietary and patented Advanced Gasification Technology”.
With the acquisition now complete, the company will head a consortium to repower the Tuscany-based plant, as well as to own and operate it.
EQTEC’s partners in this consortium include MetalNRG (LON: MNRG), as well as an Irish Family Office and an Italian Family Office. These will participate in a special purpose vehicle and invest €2.1 million total for an 80% initial equity interest.
EQTEC will hold the other 20% equity, and estimated the plant will delivered a 20% unlevered initial rate of return. Additionally, expected annual earnings before interest, tax, depreciation, and amortisation (“Ebitda”) exceeds €750,000.
In addition, EQTEC will be operation and maintenance contractor for the plant. Currently, the expected value of the contract is around €215,000 a year. Italian delivery partner COS.M.I. will be engineering, procurement, and construction contractor.
The operational plant will turn straw and forestry wood waste “into green electricity and heat” for the local community to use. The company currently expects to have an entirely recommissioned and operational plant by the second quarter of 2022.
The plant is already connects to the Italian national grid. On top of that, the project will benefit from favourable tariffs in the country on electricity from waste biomass.
Big plans ahead
The Tuscan plant is one of two EQTEC technology-based facilities, decommissioned by their prior owner-operators in recent years, that the company plans to repower to full operation.
This first plant is to be the first of the firm’s Market Development Centres. It will showcase the company’s technology within “a fully operational, commercial setting”. Announcements around plans to acquire a facility in Croatia will follow.
So far, in 2021, EQTEC’s shares are down. However, on a one-year basis, shares are up well over 600% from 0.21p a year ago to 1.66p now.
David Palumbo, EQTEC’s chief executive, was pleased the company “will lead the effort” to recommission and revive the Italian plant. He said this will demonstrate “sustainable, commercial success with EQTEC advanced gasification”.
“I am delighted to see us secure this with a well-balanced consortium of experienced partners and this is an approach we hope can be achieved for other projects in our pipeline,” Palumbo concluded.