M********* V***** CHP (Abu)

A payment in July will provide comfort and reassurance. Proof will take a little longer.

It's been like watching a slow motion car crash, hasn't it? Pretty much written that one off now as they'll likely use the coronavirus as the final death blow for this and its sister loan. Painful, but the gains from others will cover it.  A good lesson well learned. 

I take it you've seen the latest update then

COVID-19: Update for M***** V***** CHP plc Debenture holders 19 March 2020

Along with the rest of the business world we have been watching closely the development of the COVID-19 virus in the UK. The situation is that, since there can be no accurate prediction of the possible disruption to our business we can only be ready to react quickly to new circumstances as they arise.

The main areas of concern to us are: 1. Reduced commercial activity on S*** P*** Industrial Estate where the other tenants take 80-90% of our electricity generation. In the event that demand from the estate diminishes we will increase our export to the grid. It is the case however that we obtain just 5p kw for export generation compared to 13p+ for estate usage. The grid export license is limited to just 250kw and the solar PV on site takes precedence over our own export so we may well experience a cap to exports during daylight hours. 2. Our wood chip is supplied by just a handful of large sawmills and it is a by-product of their general timber processing. Most mills produce product for the building trade and we have already experienced some disruption to our supply this week. We have been told this has been due to mills not working a full 5 day week. We have been told that the mills have discerned a reduction in demand for new build timber from the major housebuilders who in turn are finding that enquires for new property purchase have abruptly dried up. The builders will therefore slow down development rather than end up with large numbers of finished houses with no customers and this will have an immediate impact on mill orders. 3. In addition, we believe there is a very real possibility of government announcing a travel to work ban for all but essential; service personnel (Health workers, prison staff, police, etc.). This will immediately cause the closedown of sawmills and wood chip distribution businesses. 4. In the event that large numbers of distribution personnel become infected and self-isolate we will suffer disruption to the deliveries of chip even if it is produced. 5. With just 4 production employees we don’t have a great deal of cover for more than one of our people developing the illness at the same time.

The disruption that we experienced this week caused us to have to shutdown generation from the CHP units. We have decided not to restart the units until we have received a 10 day supply of chip. This should prevent us having to stop and start the units which is inefficient and can undermine the gasifier components.

In the event that we experience just a few weeks disruption to our operations we will be able to manage our way through the income loss, however in the event that we experience a much longer period of 2-3 months we will obviously be in a different position. In the event that we suffer a sustained period of closure during which we have to pay fixed costs such as rent, rates, wages etc. this will have the effect of diminishing our cash on hand and, even when we do recommence generation, we will suffer an income shortfall to the extent of lost production in the closed period.

Until any closedown finishes we cannot assess the full extent of the financial damage that has been done.

We will continue to keep you informed of any major developments.

The Directors,

M***** V***** CHP PLC

Apology up front to the moderator if I was not met to post this and please take it down. I'm new here:) 

Given its lamentable  track record in dealing with this particular business, Ofgem would be singularly poorly advised to do anything but play to the spirit of its rules. Ofgem authorised subsidies are not a minor contribution to the revenue of this business. They and low cost borrowing are the business.

It was the inability of civil servants to stop handing out cash for ash, recently remembered in Northern Ireland which formed the background to the peculiar antics of Ofgem. Some elements of the M********* V***** CHP submission did look like a subsidy carosel in which value rotated through the system taking a subsidy at every turn. Ar**ne F*ster would have approved.

Worst investment I ever made.
My own fault. Should have known better. I got seduced by the 12% on offer at the beginning.
A fool and his money are easily parted. Boy, was I a fool for investing in this!!!