Handover of three of Interserve’s energy from waste (EfW) plants has slipped to the first half of 2019, according to its joint venture partner on the schemes.
US-based Babcock & Wilcox released an update on 31 December that revealed the plants would not be handed over to clients by the end of 2018 as previously expected.
They will now be handed over at “various times” in the first and second quarter of 2019.
B&W and Interserve said construction of the plants had been completed and all three were now active and delivering electricity to the grid.
Reliability and performance-testing must now be carried out before the plants can be handed over.
Interserve had previously said in its half-year report, released in August, that the schemes would be handed over to clients by the end of 2018.
In its most recent update, released in November, the 2018 deadline was not mentioned and no new handover date was given.
The company said further delays on the projects had been encountered in the third quarter.
Interserve said it faced penalties for the delays, which would reduce the net cash it expected to receive for reaching certain milestones.
Interserve and B&W signed joint venture agreements to deliver the three plants in Dunbar, Margam and Rotherham in 2015 with Interserve responsible for delivery of the structures while B&W is in charge of the energy generation elements.
Completion was originally scheduled for the end of 2017.
Interserve lost more than £200m on EfW schemes between 2016 and the middle of 2018 due to delays and cost overruns, while B&W lost $129m (£102.4m) on six European EfW schemes, four of which were in the UK, in the first nine months of 2018.
Successfully exiting the EfW sector is one of the key targets of Interserve chief executive Debbie White’s turnaround plan for the company as she tries to strengthen the firm’s finances.
New borrowing of £834m was secured in March to boost its liquidity, but investors dumped Interserve stock in the final two months of 2018 after it was reported the company needed a debt for equity swap to get its finances under control.
The company confirmed on 10 December such a move was likely with details to be confirmed in early 2019. Interserve’s shares plummeted 75 per cent on the news to hit a low of 6p per share before recovering to around 11p.
US-based B&W has separately been in talks with its own lenders and revealed on 19 December it had reached an agreement to alter its covenants, which included increasing the losses allowed on current EfW projects from $25m to $30m.
The energy specialist is also working to complete a fourth EfW plant in Teeside, which it had been delivering with Lagan Construction, which went into administration in March.
The Teeside project is not scheduled to be completed in the first half of 2019.
Interserve has been contacted for comment.