Energy, road and rail projects worth £33 billion have passed the first hurdle in getting a government infrastructure guarantee, Chief Secretary Danny Alexander has announced today.
Forty projects are now at the stage known as pre-qualification, meaning they are eligible for the UK Guarantee scheme. Over half that have pre-qualified are energy projects, helping ensure Britain develops a sustainable future energy supply.
While further discussions, assessment and due diligence remain, the move could see them secure government agreement to act as a guarantor for a project giving private lenders confidence that they will get their money back if the project cannot pay. If the government gave a guarantee it would be for a proportion of the capital value of the project, and the scheme is authorised to issue up to £40 billion of guarantees in total.
Of the £40 billion of guarantees available, the government has already awarded a £75 million guarantee to power plant Drax for their £700 million programme to partially convert the UK’s biggest coal power station to biomass. The power station will produce 7 per cent of the UK’s electricity with the biomass conversions set to be up and running over the next 3 years.
16 of the pre-qualified projects have agreed to be named.
The new pre-qualified projects named today are:
Press release, October 22, 2013