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UNITED KINGDOM WITHOUT
INCINERATION NETWORK
UKWIN BRIEFING
GASIFICATION FAILURES IN THE UK:
BANKRUPTCIES AND ABANDONMMENT
November 2016
http://ukwin.org.uk/resources/
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INTRODUCTION
The United Kingdom Without Incineration Network (UKWIN) is a network of around
100 campaign groups opposing waste incineration. This provides the organisation
with an overview of the gasification and pyrolysis sector, alongside intimate and
detailed knowledge of numerous incineration proposals and waste companies.
Promoters of gasification and pyrolysis schemes, sometimes collectively called
"Advanced Thermal Treatment" schemes, regularly make bold claims about the
technological, environmental and financial performance of their proposed facilities
with a mixed waste feedstock. In reality, where such configurations have been
attempted they have either failed to live up to these claims or operators remain
suspiciously quiet about reporting actual performance.
Because companies do not like to talk about their failures it is often hard to find out
what went wrong. For example, Air Products remain tight-lipped about the serious
high-profile problems they encountered at Tees Valley.
Would-be operators frequently point to existing and emerging demonstrator plants,
declaring that they are proposing the same in an attempt to make their proposal
sound deliverable, but as soon as the plants they cite start to fail (e.g. Isle of Wight,
Dargavel, Avonmouth, Tees Valley) these companies suddenly try to explain how
their proposal could not be more dissimilar to the failed projects from which they had
previously tried to draw credibility.
Gasification and pyrolysis constitute some of the riskiest technologies in the waste
industry and are synonymous with bankruptcies, failures and broken promises. This
perception is well deserved, with the lack of examples of success starkly contrasting
with a litany of failures.
This briefing provides some information about the following gasification and pyrolysis
projects and companies:
- Air Products' Tees Valley Projects
- Ascot Environmental and its Subsidiary Scotgen
- BCB Environmental
- Bioflame
- Biossence Renewable Energy
- Caithness Heat And Power
- Clean Power Properties
- Compact Power Holdings
- Energos
- Interserve
- New Earth Solutions
UKWIN Briefing: Gasification Failures in the UK Page 1
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AIR PRODUCTS' TEES VALLEY PROJECTS
In 2012, Waste2Tricity (who were involved in the Tees Valley projects) stated: "Air
Products are the pathfinder in this sea change of energy conversion technologies".1
Air Products, a Fortune 500 company with significant capital,2 failed to overcome the
technological difficulties they faced with their Tees Valley gasification projects even
after spending a billion dollars on the technology.
Air Products' April 2016 decision to abandon the thermal treatment market calls into
question the viability of using gasification technology with a mixed waste feedstock.
In April 2014 the UK Government announced that: "…The new 20 year [Tees Valley
gasification] contract with Air Products, worth 2% of government’s energy spend, is
expected to deliver £84 million in savings over the life of the contract through an
innovative fixed agreement that will provide stability in what the public sector pays for
energy…Air Products has longstanding expertise in building and operating large,
complex industrial gas and energy plants ensuring its projects are delivered safely,
reliably and cost-effectively".3
In October 2015 Air Products' CEO stated that: "We have always said that there is a
chance that the technology will not work…so we are still working to figure out
whether it does work or not… There's a good chance that it doesn't work, so we have
to be aware of that and I have been mentioning that for the past year."4
In January 2016 Air Products' CEO explained: "...we're in an iterative process of
trying to learn how the gasifier behaves and if we can make it work on a sustainable
basis. There is a still significant outstanding question about if we will ever be able to
get it to work on a sustainable basis. And as I said, we have given ourselves a few
months to keep trying it, but there will come a time that we might stop trying. The
technology is proving to be a lot more difficult than people thought at the beginning
and I have to say we haven't made a lot of significant progress since we talked to
you last time"5
In the end, Air Products gave up on their Tees Valley gasification projects due to
what they called "design and operational challenges".6 It was reported that: "Air
Products…announced that the Company will exit its Energy-from-Waste business.
As a result…Air Products expects to record a pre-tax charge in the range of $900
million to $1.0 billion in discontinued operations, primarily to write down assets
associated with the EfW business…"7
According to a waste trade press article: "…Tees Valley could be remembered as
one of the most expensive waste infrastructure blunders in years. Frustrating for all
those involved – and embarrassing for the UK government, which was looking to Air
Products to provide power on behalf of its Energy for Growth programme over a 20-
year fixed period…"8
UKWIN Briefing: Gasification Failures in the UK Page 2
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ASCOT ENVIRONMENTAL AND ITS SUBSIDIARY SCOTGEN
In May 2012 it was reported that: "A firm that struck a deal to build multiple
renewable energy projects across the country has said it is to file for administration.
Ascot Environmental carried out civil engineering and gasification work on waste
treatment plants at numerous sites including at Bristol and Essex, working with
waste disposal giant SITA and property management company Cyclamax
Holdings."9
"The waste-to-energy plant [Scotgen's Dargavel gasification plant] opened in August,
2009, but has been bedevilled with problems. To date, it has failed to produce
energy. It previously had a contract with part of a group of companies called
Waste2Energy, which went into administration and left a £600,000 trail of debt in the
Dumfries area."10
"Scotgen (Dumfries) Ltd has seen its permit to operate the Dargavel energy -from-
waste plant revoked by the Scottish Environmental Protection Agency (SEPA)
following its failure to ‘comply with the requirements of the permit’…The revocation
notice…was issued for the following reasons: Persistent non -compliance with the
requirements of the permit; Failure to comply with an enforcement notice; Failure to
maintain financial provision and resources to comply with the requirements of the
permit; and Failure to recover energy with a high level of efficiency."11
BCB ENVIRONMENTAL
In August 2010 it was reported that: "…BCB Environmental…entered administration
just three months after it pledged to appeal a decision blocking its proposal to build a
£24 million waste-to-energy gasification facility in Tockwith."12
BIOFLAME
In December 2010 it was announced that: "Bioflame has developed its own patented
partial-gasification technology − an advanced thermal treatment process…"13
Less than a year later, it was reported that: "…Bioflame ceased trading after its
funding was pulled...It secured the investment in December 2010 to complete the
commercialisation of the company’s technology, attract project funding, and
accelerate the rollout of projects. But the funder pulled out after invest ing £3
million…"14
BIOSSENCE RENEWABLE ENERGY
Biossence was "established in 2006 to develop and deliver renewable energy
projects".15 However, the Biossence gasification project failed despite millions of
pounds of pledged investment from the London Waste and Recycling Board and the
company entered into administration in March 2014.16
UKWIN Briefing: Gasification Failures in the UK Page 3
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CAITHNESS HEAT AND POWER
"From 2002, Highland Council embarked on a biomass project in Wick: They would
build a combined heat and power plant which would use residues from nearby tree
plantations to heat local housing and sell electricity to the grid. Few would fault the
idea…When technical problems became apparent, Highland Council took full control
of the scheme. Trials were started in October 2008 but by December that year, an
expert report advised that the [gasification] plant would never work..."17
The Scottish public sector auditor, Audit Scotland, decided to carry out a full
investigation into how Highland Council had lost £11.5 million and issued a highly
critical report, which stated: "…Ultimately, the project failed because the company
procured ‘experimental’ and high risk gasification technology which could not be
commissioned successfully…”18
CLEAN POWER PROPERTIES
In May 2012 Clean Power Properties (CPP) boasted about their plans for more than
a dozen gasification projects, but to date not a single facility has secured the
necessary environmental permit, and there are no signs of any of their proposed
facilities being built. CPP has suffered a series of setbacks, for example:
- Cwmgwili, South West Wales - CPP’s planning application was refused in
February 2016, and CPP did not appeal.
- Micheldever Station, Hampshire – CPP withdrew their planning appeal in
October 2015.
- Washwood Heath, Birmingham – CPP withdrew their environmental permit
application in May 2015.
- Thames Haven, Thurrock – CPP withdrew their environmental permit
application in December 2014.
- Eastleigh, Hampshire – CPP withdrew their environmental permit application in
November 2014.
- Castleford, West Yorkshire – CPP’s planning application for an amended
scheme was refused in June 2014. CPP subsequently withdrew their
environmental permit application in November 2014.
- Brierley Hill, Dudley – CPP withdrew their planning appeal in May 2014. CPP
withdrew their environmental permit application in November 2014.
- Leeds – CPP was refused planning permission in March 2014. The applicant
appealed in October 2014, but days before evidence was due to be submitted,
Clean Power Properties withdrew their appeal. CPP subsequently withdrew
their environmental permit application in November 2014.
UKWIN Briefing: Gasification Failures in the UK Page 4
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COMPACT POWER HOLDINGS
"Description of business: Development and exploitation of Company's proprietary
technology for the processing of waste by advanced thermal conversion using the
processes of pyrolysis, gasification and high temperature oxidation."19
In February 2011 it was reported that: "Avonmouth-based Compact Power Holdings
has entered liquidation...Compact Power Holdings was established in 1992 with the
aim of becoming a leading business in the renewable energy and environmental
sector. However, in 2008, a number of companies within the group were placed into
administration. This resulted in the loss of investors’ cash totalling almost £20m." 20
ENERGOS
In July 2016 it was reported that: "Gasification technology supplier Energos has
entered administration, citing cash flow issues caused by contractual disputes on two
of its major contracts"21 and that: "Energos’s entry into administration is the latest in
a series of issues for gasification companies in the UK this year"22 and that: "The
company’s business was based primarily around providing services and
technologies…via a process known as gasification. Prior to its entry into
administration, Energos had been contracted to construct four separate waste plants
in Glasgow, Milton Keynes, Derby and on the Isle of Wight. However, administrators
have explained that the company found itself faced with serious cash flow problems
as a result of disputes with two of its main contractors."23 According to the
administrators, the cash flow issues arose from Energos' failure to deliver on their
gasification contracts.24
INTERSERVE
In August 2016 it was reported that: "Construction firm Interserve has announced
that it is leaving the energy-from-waste (EfW) industry months after revealing
complications with on-going [gasification] projects had cost the company £70
million…In May, the firm confirmed that design, procurement and installation issues
at Viridor’s planned gasification plant in Glasgow had led to ‘deterioration’ in
Interserve’s contract, prompting a £70 million contract provision being imposed on
the company."25
UKWIN Briefing: Gasification Failures in the UK Page 5
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NEW EARTH SOLUTIONS
New Earth Solutions, New Earth Energy, and New Earth Advanced Thermal
technology (NEAT) are associated with several failed gasification projects.
The NEAT gasification facility in Canford, Dorset was to have processed 8,000
tonnes a year of Solid Recovered Fuel (SRF) but was shut down in 2012.26 The
larger (100,000 tonne per annum) gasification facility built in Avonmouth, Bristol
never operated as New Earth Solutions had expected, and the company abandoned
the facility in 2014.27 New Earth is also associated with abandoned gasification
projects in Easter Langlee (Scottish Borders), Hooton Park (Merseyside), Winfrith
(Dorset), and Blaise Farm (Kent).
The company told shareholders in July 2015 that: "…the level of performance has
consistently fallen well short of targeted levels. The programme of works
communicated in March, whilst undertaken, has proven to be unsuccessful.
Operational, manpower, maintenance and repair costs have consistently proved to
be much higher than originally planned. In April, New Earth engaged an external
engineering consultancy to carry out a further technical and financial review on the
future potential for the ERF [gasification] Plant. The consequence of this review is
that further essential and significant capital expenditure has been identified in order
to potentially improve the ERF Plant’s performance. Based on history, this
programme will still carry substantial technical risk…as with all technology there is
often a steep learning curve and sometimes a high degree of uncertainty as to the
outcome and these have unfortunately been amply demonstrat ed in the performance
of the ERF to date…"28
In June 2016 it was reported that: " New Earth Solutions Group has entered
administration…The announcement is likely to concern a number of local authorities
that have contracts with New Earth, which operates five waste plants at Avonmouth
near Bristol, Canford in Dorset, Sharpness in Gloucestershire, Cotesbach in
Leicestershire and Blaise in Kent…"29
And in July 2016 it was reported that: "Creditors to the New Earth Solutions Group
are likely to miss out on over £9 million after the waste management company was
sold out of administration. A report issued by the company’s administrator Duff &
Phelps to its 260 creditors explains that £9,169,521 is owed, with no hope of
repayment…"30
Investigative journalism blog http://notjustsheepandrugby.blogspot.co.uk/ has been
looking into New Earth Solutions and how Scottish Borders Council became one of
the many victims of the company's failure to deliver. The more information that
comes to light, through Freedom of Information and other means, the clearer it is that
the Council should never have relied upon the company's unproven gasification
technology to treat their waste. The failed Easter Langlee gasification project cost
Scottish Borders Council at least £2.4 million pounds with nothing to show for it. 31
UKWIN Briefing: Gasification Failures in the UK Page 6
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SOURCES
1 http://www.waste2tricity.com/dl/w2t-gives-vote-of-confidence-to-air-products.pdf
2 http://www.airproducts.com/Company/news-center/2016/04/0404-air-products-will-exit-energy-
from-waste-business.aspx
3 https://www.gov.uk/government/news/new-energy-deal-to-save-84m-from-government-bill
4 http://seekingalpha.com/article/3620496-air-products-and-chemicals-apd-seifollah-ghasemi-
q4-2015-results-earnings-call-transcript?part=single
5 http://seekingalpha.com/article/3849046-air-products-chemicals-apd-ceo-seifi-ghasemi-q1-
2016-results-earnings-call-transcript?part=single
6 http://www.airproducts.com/Company/news-center/2016/04/0404-air-products-will-exit-
energy-from-waste-business.aspx
7 http://www.airproducts.com/Company/news-center/2016/04/0404-air-products-will-exit-energy-
from-waste-business.aspx
8 http://www.letsrecycle.com/news/latest-news/air-products-what-happens-now/
9 http://www.mrw.co.uk/news/waste-to-energy-firm-to-file-for-administration/8630500.article
10 http://www.dailyrecord.co.uk/news/local-news/ownership-scotgen-firm-changes-hands-2409918
11 http://resource.co/article/Waste_Law/Scotgen_permit_revoked_after_series_breaches-3554
12http://www.letsrecycle.com/news/latest-news/waste-management/bcb-environmental-enters-
administration
13 http://www.theengineer.co.uk/news/esb-novusmodus-to-invest-up-to-45m-in-
bioflame/1006435.article
14 http://www.gazetteherald.co.uk/news/9288356.Pickering_firm_goes_into_liquidation/
15 http://www.wirral.gov.uk/planning/Docs/DMZfiles/23050_2.pdf
16 http://www.endswasteandbioenergy.com/article/1286280/uk-east-london-wte-project-enters-
administration
17 http://www.biofuelwatch.org.uk/wp-content/uploads/Biomass-gasification-and-pyrolysis-
formatted-full-report.pdf
18 http://www.audit-scotland.gov.uk/docs/local/2010/sr_100624_chaps.pdf & http://www.audit-
scotland.gov.uk/docs/local/2014/sr_140109_chap.pdf
19 http://www.londonstockexchange.com/exchange/prices-and-markets/stocks/new-and-recent-
issues/new-recent-issue-details.html?issueId=560
20 http://www.insidermedia.com/insider/south-west/46919-
21 http://www.letsrecycle.com/news/latest-news/energos-enters-administration-over-cash-flow/
22 http://resource.co/article/another-setback-gasification-sector-incineration-specialist-enters-
administration-11238
23 http://www.realbusinessrescue.co.uk/company-administration/clean-energy-company-based-in-
warrington-enters-administration-after-cash-flow-crisis
24 13 Sep 2016 "Statement of administrator's proposal" available from:
https://beta.companieshouse.gov.uk/company/03109022/filing-history
25 http://resource.co/article/interserve-quitting-unique-challenges-energy-waste-industry-11299
26 https://www.whatdotheyknow.com/request/195254/response/
487012/attach/4/Gasification%20of%20MSW.pdf
27 http://www.premiernewearthfund.com/cms/documents/NERR%20-
%20Letter%20to%20shareholders%20%2024%207%2015%20%20(2).pdf
28 http://www.premiernewearthfund.com/cms/documents/NERR%20-
%20Letter%20to%20shareholders%20%2024%207%2015%20%20(2).pdf
29 http://www.letsrecycle.com/news/latest-news/breakdown-of-talks-lands-new-earth-in-
administration/
30 http://resource.co/article/9-million-go-unpaid-new-earth-solutions-investors-11254
31 http://notjustsheepandrugby.blogspot.co.uk/2015/07/fall-out-from-avonmouth-fire-sale.html
UKWIN Briefing: Gasification Failures in the UK Page 7