Foresight bulks up timber-to-energy ambitions

Investment firm pumps £14m into firms specialising in biomass energy, waste-to-power plants and plastics recycling

Investment firm Foresight Group has stepped up its interest in the biomass and recycling sectors ploughing £14m into three new companies.

The company, which recently launched a £22m sustainable investment fund, announced last week that it has invested £5m in Yorkshire-based wood pellet producer Land Energy, £6m in industrial waste-to-energy firm AWP Environmental and £3m in recycling specialist Lynwood.

The latest round of deals follow similar investments in waste wood-to-energy specialist O-Gen and plastics recycling firm Closed Loop, and extend Foresight's presence in the biomass and recycling sectors.

Speaking to BusinessGreen earlier this year, Foresight Group founder and chairman, Bernard Fairman outlined his interest in wood-to-energy technologies, arguing that using virgin timber to fuel biomass plants could help "revitalise the UK forestry sector".

"If we are talking about planting crops to generate energy, this approach makes much more sense than biofuels, which it has been shown to be the cause of both environmental problems and climbing food prices," he said. "Initially companies in this sector will focus on working with pallet firms and skip operators to supply waste wood, but there is no reason fresh timber could not be used in the long run."

Foresight has now underlined its commitment to this business model with its investment in Land Energy, which sources wood from local forests to produce pellets that can be delivered as renewable wood fuel in the form of wood pellets to schools, homes and offices in the Yorkshire area in order to help them lower their carbon impact.

The company said that interest was growing in timber as a renewable source of heat energy, citing recent experiences in Germany where wood pellet consumption for fuel has risen ten-fold in the last four years.

"Land Energy fits our vision of a business that helps the environment while offering attractive returns to investors," said Matt Taylor, a Partner of Foresight Group. "We are working with the company to roll out the concept to three regions of the UK. We strongly believe that local sourcing of wood pellet fuels will gain popularity in the future as people start to count the rising financial and carbon costs of transporting fuel."

Meanwhile, the £6m invested by Foresight in AWP Environmental will go towards funding the company's planned £18m gasification plant in Tockwith, Yorkshire, which will use potentially dangerous industrial waste such as used oil, paints and inks to generate enough energy to power about 6,000 homes.

Plastics recycling firm Lynwood said it plans to use Foresight's £3m cash injection to double its production capacity. The company specialises in collecting off-cuts and waste materials from manufacturers of a variety of plastic products and remoulding the material into products such as outdoor furniture.