On Wednesday, global independent infrastructure investor DIF Capital Partners announced that it has bought a 10 percent, follow-on stake in the Dublin Waste to Energy PPP project. Together with its partner, German asset manager MEAG, DIF acquired the stake from Macquarie’s Green Investment Group (GIG).
Post-transaction, DIF and MEAG jointly own a 50 percent stake in the energy facility, which is supported by a 45-year contract with Dublin City Council.
Located in Poolbeg, Dublin Port, the Dublin Waste to Energy PPP processes and incinerates 600,000 tons of residual waste each year, generating electricity from burned waste that is then exported to Ireland’s national grid. Enough energy is produced at the facility to power 80,000 Irish homes.
The facility is part of a wider regional waste management initiative in Dublin, aimed at reducing waste, maximizing recycling and generating energy. It benefits from an Irish renewable energy feed-in tariff (REFIT) scheme to help Ireland meet its goal of 40 percent renewable energy by 2020 and guaranteeing a minimum price -per-unit to renewable electricity generators. The facility was built by New Jersey-based waste-to-energy producer Covanta, which initiated the project as a joint venture with GIG in 2017, and remains its long term operator.
The waste-to-energy vanguard
DIF’s stake points to increasing interest in the role of waste-to-energy (WTE) solutions—term used for burning household and other unpreventable, reusable or recyclable waste to generate steam, electricity or hot water—across Europe.
According to data from the Confederation of European Waste-to-Energy Plants(CEWEP), efficient WTE incineration methods reduce waste volume by 90 percent, and are held to the the strictest emissions limits of any industry under the EU Industrial Emissions Directive.
Proponents also note that waste-to-energy solutions reduce the amount of waste sent to landfills, and that based on the percentage of waste that is designated “biomass,” these methods produce energy that is around 50 percent renewable.
By using high-efficiency cogeneration (combined heat-and-power production) methods to recover both heating and cooling power from the production process, Europe’s waste-to-energy plants have enough capacity to supply 18 million people with electric power and 15.2 million with heat. This estimate is based on CEWEP’s data showing 90 million tons of eligible waste were treated in 2015.
In October 2020, nine European energy trade groups—including COGEN Europe, Energy Cities, Energy Technologies Europe, Euroheat & Power and European Aluminum, issued a joint statement in support of Waste-to-Energy technologies in the EU Taxonomy (of environmentally sustainable economic activities). They voiced their support for waste-to-energy as a complement to (not a replacement for) recycling and taking pollutants out of the eco-cycle, for diverting residual landfill waste, and in support of the EU’s declared maximum landfill target of 10 percent for municipal waste in 2035.
Additionally, proponents note, waste-to-energy enables valuable secondary raw materials—such as metals and aggregates—to be recovered These can then be recycled into the manufacturing economy, providing an alternative to energy-intensive extraction processes.
The Dublin project is DIF’s second major waste-to-energy project. In 2018, DIF was part of a consortium, including Macquarie Capital and Phoenix Energy Australia that financed a greenfield waste-to-energy facility in Kwinana, near Perth. DIF acquired a 60 percent stake in that project through its fourth and fifth infrastructure funds.
The Perth project was built to handle 400,000 metrics tons of household, commercial, and industrial waste from landfills each year, or roughly a quarter of Perth’s post-recycling waste.