Air Products recently announced that it will exit its Energy-from-Waste (EfW) business. As a result, the EfW business segment will be accounted for as a discontinued operation effective in the Company’s second fiscal quarter. Air Products expects to record a pre-tax charge in the range of $900 million to $1.0 billion in discontinued operations, primarily to write down assets associated with the EfW business to their realizable value.
In previous public comments, Air Products’ management has communicated the challenges with the Tees Valley, UK projects. Testing and analysis completed during the Company’s fiscal second quarter indicated that additional design and operational challenges would require significant time and cost to rectify. Consequently, the Board of Directors has decided that it is no longer in the best interest of the Company and its shareholders to continue the Tees Valley projects. Air Products will work to optimize the cash value of its investments. Exiting the EfW business will allow the Company to direct its resources to its core business of Industrial Gases.
“Air Products is focused on our core Industrial Gas business. We pushed very hard to make this new EfW technology work and I would like to thank the team who worked so diligently. We appreciate the hard work of our employees and contractors at the site, and certainly understand their disappointment in this decision. We are also disappointed with the outcome,” said Seifi Ghasemi, chairman, president and CEO of Air Products.
The Tees Valley project located in the Northeast of England would have used AlterNRG’s advanced plasma gasification energy-from-waste technology. It was supposed to generate around 50MW of electricity per plant, enough to provide electricity to over 100,000 homes, and to divert around 350,000 tons/year of non-recyclable waste from landfill. The project was first announced in 2010.