Biomass plant for Southampton cancelled as Helius runs into financial problems

Energy company Helius has been looking to build a £300m wood-fuelled station in Millbrook for the past five years despite protests and objections from residents over pollution.

But now the company is set to delist from the stock exchange and sell 50 per cent of its stake in its Helius CoRDe plant in Scotland as it seeks to recoup cash following plummeting share prices.

It means plants proposed for Bristol and Southampton will not go ahead.

In a statement, Helius said: “Despite extensive efforts to secure finance over the past three years, the Company has been unable to obtain the required equity funding to meet the full construction costs of the project [Avonmouth].

“Given that it has not been possible to obtain funding for the Avonmouth Project within the available timescales, the board does not consider that the company will be able to deliver the Southampton Project.”

The company claimed the 100megawatt (MW) Southampton site could produce enough energy to power 200,000 homes and save the equivalent of 470,000 tonnes of CO2 per year.

But residents have campaigned against the development for years and set up the group No Southampton Biomass to fight the plans.

Steve Galton, who helped form the group and is also city councillor for Millbrook, said he was delighted at the news.

He said: “This is the news we have all been waiting for. It is a shame Helius previously refused to admit what we all knew, their plans just didn't stack up. Despite their claims, their energy has never been green.

“However the proof is in the pudding as Helius finally admit defeat and No Southampton Biomass has been proven correct.”

He added: “Southampton City Council previously made it clear they would not be a heat customer for Helius and it was at this point No Southampton Biomass knew their plans were a dead duck.”

Cllr Jeremy Moulton, who represents Freemantle, said: “This is fantastic news that Freemantle and Regents Park residents have been hoping to hear for the last four years. We can now heave a huge sigh of relief.

“All the campaigning, leaflets, posters, public meetings and lobbying of ministers have finally paid off. In the end it became clear to Helius that locally residents wouldn't put up with their plans which would damage the local community and the government were not prepared to help support something which was not truly green.”

It follows months of uncertainty for the company after an unnamed investor pulled out of the Avonmouth deal at the last minute in October 2014 while the company also made a raft of redundancies in a £1m cost-cutting measure.

John Seed, Helius chairman, added: “Having considered the trade-off between potential future returns and current value available for shareholders we consider that the disposal of our interest in Helius CoRDe and the subsequent return of all available cash provides the best value for our shareholders as a whole.”