PowerHouse Energy (PHE) has signed a collaboration agreement with Peel Environmental. This seeks to develop 11 DMG facilities at sites in the UK, primarily on Peel’s land, including the previously announced project at Peel’s Protos Energy Park on Merseyside. The collaboration is part of Peel’s strategy to develop ‘Plastic Parks’ where waste plastics that cannot be recycled are used to generate electric power and hydrogen rather than being sent to landfill.
PowerHouse’s long-term partner, Waste2Tricity (W2T) will act as project developer for each facility. Peel will provide suitable sites on industrial parks, fit the infrastructure, identify sources of waste plastic and purchasers of power and hydrogen and help W2T secure funding from investors for each site. As with the Protos site, PHE will receive fees for each project for carrying out tests on the proposed feedstock and providing a customised front-end engineering design. Additionally, once each plant is commissioned, PHE will receive operating licence fees. Peel estimates that the development costs for this enlarged pipeline of 11 sites would be at least £130m. We note that W2T’s adoption of the role of developer removes the need for PowerHouse to finance the construction of plants, eliminating a major dilution risk for shareholders.
Peel has been evaluating the technology over the last 30 months, so the formal collaboration is a strong endorsement of DMG. Moreover, Peel will become actively involved in the ongoing discussions between W2T and potential financial backers for the Protos site. PowerHouse has already completed the first stage of the engineering work for this site, the results of which have been used in public and council consultations intended to facilitate planning submission.