Macquarie Capital and Macquarie Commodities and Financial Markets (together ‘Macquarie’) have reached financial close on £900 million of total funding for the Tees Renewable Energy Plant (Tees REP), a 299MWe biomass combined heat and power plant. Developed by MGT Power and located in Northeast England, Tees REP will be the world’s largest new-build biomass plant.

Macquarie, partnering with MGT, has successfully commercialised, structured and financed the project through development to financial close. Construction is due to start imminently and be completed by 2020.

Macquarie will own 50 per cent of the equity in the project, with Macquarie Capital introducing Danish pension fund PKA as an equity co-investor and partner who will own the remaining 50 per cent stake.

Macquarie Capital also acted as financial advisor raising more than £650 million of senior debt and, drawing on the expertise of Macquarie’s Commodities and Financial Markets team, developed the commercial and fuel supply arrangements for the plant. Macquarie’s Commodities and Financial Markets is also providing a long term route to market based power purchase agreement.

Matt Booth, Managing Director, Macquarie Commodities and Financial Markets, commented: “Macquarie has a long track record of providing development and later stage capital to the energy and commodities sectors. We work with our clients to help them grow and develop their businesses and are pleased to have been able to contribute to the success of this important project.”