EQTEC PLC (AIM:EQT) has obtained debt funding to support most of the cost of building a 1MWe (megawatts electric) waste-to-energy project in Greece, with much of the remaining funding expected to come from government-subsidised debt.
Optima Bank and the company have signed head of terms for a debt facility to enable the construction at the site in Livadia, 100km northwest of Athens, where waste-to-energy gasification will be installed to convert mixed agricultural waste from local farms into electricity.
The debt facility would provide senior debt up to 75% of the value of the total capital required for the project, EQTEC said, with the balance held as equity by its EQTEC Synergy Projects joint venture.
Before the loan is signed off, independent engineers from TÜV will need to certify the project, which is expected to be completed around the end of September.
EQTEC said its JV partners are in talks with energy transition infrastructure funds about selling some project equity in Livadia and other nascent projects in the portfolio.
The JV is also confident that all projects currently in its pipeline for Greece will qualify for funding under Greece’s Recovery and Resilience Facility (RRF), “making available low-cost subsidised debt for the projects”.
Optima Bank was said to have expressed an interest in financing further projects developed by the JV if RRF support can be attained.
Grant Thornton Greece has been engaged to analyse eligibility and potentially prepare for and support the RRF application process.
“As economies and societies struggle in the aftermath of the Covid pandemic, we are encouraged by this sort of support in favour of innovation that will transition communities away from fossil fuels by providing local, baseload energy from local waste,” said David Palumbo, chief executive of EQTEC.
“We see this business model gaining traction in so many of our target markets and look forward to accelerating its implementation across Greece and beyond.”