Energy Power Partners will provide full funding for the 3.2 megawatt facility.
Israel-based Bluesphere Corp. a company that develops, manages and owns waste-to-energy (WTE) projects, has announced the receipt of a term sheet from Energy Power Partners (EPP), El Segundo, California, for full equity financing of over $15 million for its 3.2 megawatt (MW) WTE project in Johnston, Rhode Island. The facility will generate electricity from biogas derived from organic waste.
Bluesphere and EPP have agreed to enter into a final, definitive agreement by no later than August 30, 2014, pursuant to which the funds will be made available to the company in cash for the construction and implementation of the Johnston project subject to completion of final due diligence by EPP.
"We already launched the Johnston project based on our own funds and other agreements entered into for the financing of this anaerobic digestion facility,” says Bluesphere CEO Shomi Palas. “However EPP is an extremely desirable partner not only for its expertise and experience in implementing projects of this nature, but also because it is offering to finance this project with 100 percent equity. Not having debt creates greater cash flow and minimizes restrictive covenants.”
Palas adds, “Bluesphere will maintain a meaningful equity stake in the project, while also earning project management fees and profit-sharing with build-in performance incentives. This is another huge milestone in the development of this project. We have started the Johnson project on time and we anticipate reaching commercial operations and delivering power by December 2015."
Bluesphere recently announced it signed a Letter of Intent with a company in the recycling and waste industries which will supply between 100-200 tons of organic waste per day to the Johnston WTE facility. Agreements and other Letters of Intent are in place for a 15-year electricity purchase agreement, site lease with purchase option, compost off-take agreement, and EPC contractor.
Bluesphere generates electricity from biogas derived from organic waste, which is mostly food waste, and sells this electricity to leading electric companies through long-term power purchase agreements.