Ecostrat Inc., New Energy Risk and Yilkins teams up to tackle biomass feedstock supply risk
In Canada, Ecostrat Inc., New Energy Risk (NER), a wholly-owned division of Paragon Insurance Group, and Yilkins are joining forces through a new strategic alliance aimed at tackling one of the biggest blockers to biomass project finance: feedstock supply risk. Lenders won’t fund what they can’t verify, and uncertainty around supply has quietly kept viable projects from ever reaching construction. Under the alliance, Feedstock Supply Insurance (FSI) will be made available to developers who license Yilkins’ drying, torrefaction, and carbonization technology, subject to underwriting and project-specific evaluation.
Lenders routinely decline to fund biomass-to-energy and biomass-to-syngas projects for one reason: without a guaranteed feedstock supply, developers are unable to close in on Final Investment Decision (FID). That holds true even when the underlying economics are sound, which is why so many facilities capable of converting wood and organic residues into fuels, chemicals, and biocoal never break ground.
Rather than leaving developers to address feedstock security independently, Yilkins will introduce technology licensees to Ecostrat and NER’s Feedstock Supply Insurance offering, which may help address lender concerns regarding feedstock availability. The alliance is intended to help qualified projects address feedstock supply concerns earlier in the development process and support financing discussions.
Category: Fuels
