Active Energy (LON:AEG) has played down a newspaper report stating the company claimed it could save one of Britain's largest coal power stations from closing.
The decision to close Eggborough power station in Yorkshire in March, 2016 could be reversed if a new biomass fuel technology was introduced, wrote The Times on Friday.
It comes amid a wave of announced power plant closures in the UK, with Eggborough being the most recent. RWE has said it is looking to close seven plants by 2023 in a bid to comply with EU rules.
Broker Jefferies has said by March next year, more than 16,000 Mw of coal-fired capacity in the UK will have been shut since 2012.
Last month, Active Energy told investors it was teaming up with US firm BEE in a joint venture to commercialise what it describes a “revolutionary” new manufacturing process that allows biomass to be burned in unconverted coal-fired power stations, meaning thousands of plants could 'go green' and not be forced into closing.
Czech firm Energeticky a Prmyslov Holding (EPH), which owns Eggborough, has previously cited carbon taxes and EU emissions standards as the main reason behind the decision to pull the plug on the plant and now AEG has discussed the technology with them.
"Eggborough power station is just one of several power plants in Europe, North America and the Middle East with whom the AEG CoalSwitch team have been in communication," Active Energy said in a regulatory statement.
But it went on to stress "such discussions are at a very early stage" and that "no commitments have been made to individual plant owners or operators.."
Speaking to Proactive Investors, Active Energy chief executive Richard Spinks said on Eggborough's owners: "Whether or not they wish to be one of our partners or not or whether or not we wish to eventually service them is to be decided."
Spinks confirmed that the joint venture had generated considerable international interest from plant owners and operators and it was "building a team" just to handle the interest, while focusing still on developing the technology and fundraising.
The focus remains on building the first high-volume CoalSwitch fuel manufacturing system (around 300,000 tonnes a year) by mid-2016.
The process involves cleaning the raw biomass by removing salts, minerals and other contaminants that harm the atmosphere and damage power plant furnaces.
This converts the material into valuable high-energy fuel feedstock, without the low and medium volatiles resident in other biomass-based fuels, such as 'white pellets'.
Crucially, it means the fuel can be burned in coal fired power stations, or alongside coal – negating the need for an expensive conversion.
The scale of the opportunity is endless for Active Energy, Spinks suggested.
Even if it was to provide enough fuel for all power stations on earth not to be coal-taxed, it would have to produce over 1bn tonnes of the new fuel per year, he said.
On Monday, Active Energy shares added 4.31% to 6.05p.