NORWA, AUSTRALIA — Australian wheat processor Manildra Group has received A$85 million (US$61.16 million) in funding to build a cleaner power plant that runs on natural gas instead of coal to significantly reduce its emissions, the Clean Energy Finance Corp. (CEFC) announced May 5.

The CEFC investment on behalf of the Australian government will be part of a A$190 million (US$136.71 million) project to build a cogeneration power plant at the company's Shoalhaven Starches plant in Nowra, New South Wales. The Shoalhaven Starches site is the global leader in the production of vital wheat glutens, modified proteins, wheat starches, syrups to ethanol and animal stockfeed.

The installation of cogeneration technology will reduce emissions at the energy intensive Nowra plant by about 40%, abating an estimated 332,000 tonnes of CO2-e annually. Manildra will no longer use coal to generate steam at the plant. Work on the plant will start by the middle of the year and is expected to be completed by early 2023.

John Honan, managing director of Manildra Group, said the family-owned Australian company recognized that this project would establish a stable, reliable and cleaner energy source critical to the local economy and the company’s successful manufacturing operations.

“Employing more than 350 people on site, our integrated manufacturing process relies on heat (from steam) production to power our operations, day-in, day-out, 365 days a year,” Honan said.  “We’re very proud to work with the CEFC. Their support has enabled Manildra Group to increase cleaner energy sources, substantially reduce our greenhouse gases and reduce coal usage entirely.”

The CEFC investment will finance two behind-the-meter high efficiency gas fired combined heat and power plants. The new infrastructure will replace the coal fired boilers and the existing gas boilers used to generate steam. Independent analysis in support of the development approval by engineering consultant GHD estimates that the new cogeneration plant will reduce the emissions intensity per tonne of flour throughput from 0.62 to 0.36t CO2.

The project also is financed by a A$95 million (US$68.36 million) commercial debt package that is supported by a A$50 million (US$36 million) guarantee from Export Finance Australia. In addition, Manildra Group has successfully registered the project with the Clean Energy Regulator to generate Australian Carbon Credit Units.

“Domestic manufacturing poses a significant decarbonization challenge,” said Ian Learmonth, chief executive officer of CEFC. “As the world steps up its focus on emissions reduction, carbon intensive fuel sources are becoming less economic. Manildra Group is a globally competitive family business that recognizes the financial prudence of long-term investment in lower carbon fuel to power production.”