A new deal wit Air Products will cut the government’s energy bill by £84 million.
Air Products will build a £300 million ‘advanced gasification energy from waste’ as part of the 20 year deal, in Tees Valley, Teesside.
Via the Government Procurement Service (GPS), the government has signed a fixed price power purchase agreement (PPA) with Air Products for the company to supply 37MW of power.
Minister for the Cabinet Office, Francis Maude, said: “This is the beginning of a pioneering approach to how Government uses its collective buying power and long term demand to buy energy.”
The government’s Energy for Growth Initiative was launched in December, and this deal forms part of that.
Maude added: “This is about changing the way we work to not only get the best out of our suppliers, but the best out of the UK.”
Lisa Jordan, Air Products’ business manager for Bio-Energy Europe, said: “By buying the electricity we produce, the Cabinet Office will help Air Products divert up to 350,000 tonnes of non-recyclable waste from landfill every year, which we will turn into reliable, controllable, renewable energy.”