Rugeley power station in Staffordshire has been saved from closure. International Power, the owners of the power station have managed to raise a £485m refinancing package.
The coal-fired site, which dates back to 1970, would have been forced to close in 2015 under new EU regulations, which require all oil and coal-fired power to be fitted with desulphurisation equipment. The desulphurisation process involves the injection of limestone slurry, which removes 95% of sulphur dioxide, the main cause of acid rain.
£145m will be used to install the desulphurisation equipment while the remainder of the money is expected to be used for credit support, working capital requirements and general corporate purposes. The main arrangers of the finance include the Commonwealth Bank of Australia, Calyon and the Royal Bank of Scotland.
“This is an attractive financing package for Rugeley, which previous had no associated debt,” commented a spokesperson for International Power.
International Power has also announced the acquisition of the Indian Queens plant in Cornwall. The £32m deal to buy the 140MW plant will be funded by existing cash resources.
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