Planned to be built at the group’s site in Widnes, the facility is expected to be the largest waste wood renewable energy plant in northwest UK when it starts operations in December 2016.
Stobart Infrastructure will hold a 40% stake in the new plant and the UK Green Investment Bank will own a 49% interest.
The remaining 11% will be held by Burmeister & Wain Scandinavian Contractor, the project’s engineering, procurement and construction contractor.
Stobart Energy will supply the plant with 146,000t of waste food material annually over a 16-year period. It will operate an adjacent wood drying facility using the heat from the 7.8MWth CHP plant.
The drier facility will dry 140,000t a year of virgin wood material and produce an output of 90,000t for sale into the small scale wood chip and pellet market.
Stobart Energy & Infrastructure CEO Richard Butcher said: "This agreement secures an attractive energy investment for the Group and will contribute 24% of the growth we need to achieve our target of supplying 2m tonnes of fuel per annum into the UK biomass market by 2017/18 from 1m tonnes per annum at present.
"This CHP Plant will generate a strong return on investment in the plant’s equity as well as providing the Group with a 16 year biomass fuel supply contract, a long-term wood drying income stream and valuable engineering revenue on the development."
