UP to 400 jobs could be created near a former North-East steelworks if plans are approved to build a £250m electricity plant. 

Yorkshire-based waste management company PMAC Energy has secured 25 acres of Redcar Bulk Terminal's land as the location for a plant to convert household and commercial rubbish into energy, which it says could help power the economic regeneration of South Tees.

The power plant is understood to be key to a wider scheme to revive the Redcar area dealt a devastating blow following the closure of SSI steelworks in 2015, which cost more than 2,000 steel jobs and thousands more at local suppliers. 

Subject to permitting and planning approvals, the new plant could be producing waste-derived fuels by 2021 and generating enough electricity to power 56,000 homes, the team behind the plan said.

They believe about 300 construction jobs would be created during the two-and-a-half-year building phase, with up to 100 full time staff needed to run the plant itself.

The announcement marks some positive news for the port which suffered a sharp decline following the steelworks closure. Tweo weeks ago it secured a major deal with fertiliser miner Sirius Minerals to transport millions of tonnes of polyhalite.

Garry O’Malley, Redcar Bulk Terminal (RBT) general manager, said: “Today’s announcement is hugely significant, not only for our businesses but for the whole South Tees region. We’ve worked closely with PMAC Energy on this project for a number of years and it’s another reflection of the continued resurgence of Redcar Bulk Terminal and this site.

“Like many others on Teesside, we were dealt a hammer blow when SSI closed – so much so you could say RBT’s mere survival is a success in itself. We’re grateful for the strong support we received during these difficult times, in particular from Greybull who provided us the capital and energy required to turn the corner. The fact we’re seeing significant growth, diversifying our business and attracting new companies to the Tees is an incredible achievement.

“Projects like this, which could bring hundreds of millions of pounds and many valuable jobs to Teesside, are heralding the start of a new era for RBT and our employees.

“We’ve a healthy business pipeline and the continued investment in our operations from British Steel and Greybull means we can continue to grow with confidence and pace.

“These are exciting times and we look forward to working with PMAC Energy to deliver renewable energy to power the future economic success of this site and this region.” 

Unlike many other energy projects across the UK, the PMAC Energy plant would be completely free from Government subsidies and financial support with all income generated purely from waste processing fees and the sale of electricity. Following commissioning the plant would operate as a 100% commercial entity.

Rob Lewis, managing director of Hull-based PMAC Energy, said: “This is an incredible opportunity to deliver a major economic boost to the South Tees area and capitalise on the great strengths and capabilities of Redcar Bulk Terminal.

“RBT’s superb port facilities and road and rail links make this the perfect location for this plant. Not only does it give us the logistical advantages of being on the River Tees, the area also provides us with the workforce we’d need to manage the volume of waste coming into the plant and the quantity of fuel being created.”

Working in partnership with RBT – on a 25-year lease – the PMAC Energy facility would recover and treat municipal and commercial waste to create fuel for the renewable energy sector, capable of providing both heat and power. Generated fuels would not only power the on-site waste to energy plant but also be available and sold into the export market.

Redcar MP Anna Turley said: “This is another big investment project in our area which builds on our existing strengths in energy generation and waste management, and crucially creates new skilled jobs for people in our area.

“I was pleased to visit RBT recently to see how the business is growing year on year and this latest project is another boost for their growth ambitions. I look forward to working with RBT and PMAC as this project develops, especially to ensure local people can benefit from as many of the new jobs as possible.”