Monday, 22 August 2016

Nominations for New Earth 'Hall of Shame'


A couple of former Government ministers, the apparently gullible Carbon Trust, and Regen South West have been nominated by Not Just Sheep & Rugby to join Scottish Borders councillors in a special Hall of Shame for those who thought New Earth Solutions Group [NESG] was a world beating waste treatment contractor.

With the bankrupt Group now in its death throes and about to be dissolved together with its equally useless "funder" New Earth Recycling & Renewables [Infrastructure] PLC or NERR we thought it might be interesting to determine whether Scottish Borders Council had been the only party to fall for the partnership's worthless sales patter.

As most readers will know by now council taxpayers who rely on SBC for their local government services were deprived of at least £2.4 million after elected members awarded NESG a £21 million deal to deliver a 'cutting edge' facility to treat the region's annual output of 40,000 tonnes of municipal rubbish.

The troubled contract had to be completely ditched in 2015 after the Dorset-based Group's inappropriately named NEAT technology finally exhausted the council's patience. The form of incineration had been a dud from day one yet local councillors were mightily impressed by what they were shown, and sealed the deal in advance of even the research and development stage being finalised.

Meanwhile the offshore NERR fund with its links to the tax haven of British Virgin Islands repeatedly told SBC their project at Easter Langlee would be the next NESG job to receive financial backing. Unfortunately, behind the scenes, NESG was piling up more than £150 million of debt and owed NERR over £100 million, forcing the Isle of Man fund managers to suspend operations.

NERR now has liquidators from accountants Deloitte in charge with a meeting of no doubt angry investors due to be held at the end of this month. Those who placed their cash in NERR have already been told they will not get their money back.

Yet the twin paths to financial disaster are littered with tributes from politicians, millions of pounds of grants to assist the lame duck Group with technological development and even the occasional "gong" handed over at so-called glittering award ceremonies. It is doubtful whether the unsecured creditors of NESG, between them owed around £9 million, will be very impressed with any of that.

First candidate for the Hall of Shame is the Coalition Government's Secretary of State for Business, Innovation & Skills Vince Cable who toured New Earth's Canford research and development facility in July 2012 to inspect the fledgling New Earth Advanced Thermal (NEAT) unit there.

After watching the system which was later installed in New Earth's Avonmouth treatment plant, Dr Cable declared: "It is very encouraging to see projects such as New Earth's renewable energy recovery plant being developed. The quality of innovation I have seen here -and the potential it offers UK plc - provides encouraging evidence that the entrepreneurial spirit we need to re-build our economy is thriving in this part of Dorset".

So how's that going now Dr. Cable? Well as we all know the Avonmouth power recovery business proved so troublesome and expensive it had to be "sold" to an Australian bank for nothing at all.

Another distinguished visitor to Canford a month later was Secretary of State for Communities and Local Government Eric Pickles accompanied by officers and members of Bournemouth Council. They too were told about the development work on the NEAT process although we could not establish whether Mr Pickles and his group were moved to wax lyrical about their hosts.

Perhaps The Carbon Trust should be afforded pride of place in our Hall of Shame. In 2010 New Earth Solutions was handed £4 million by the Trust from an £18 million fund set up by the UK Department of Energy and Climate Change. It was the first monetary award from the new fund.

A news release at the time told readers: "The company [New Earth] is looking to use gasification and pyrolysis (chemical change brought about by the action of heat) technologies to convert waste-derived fuel into electricity".

This was precisely the system approved by Borders councilors and which was to cost their constituents millions of pounds to hire expensive consultants, lawyers and other specialists who all trousered fat fees before the Easter Langlee venture collapsed in disarray with no-one accepting responsibility for the financial disaster.

Our final nomination (for now) goes to the organisers of the 2013 Regen South West Green Energy Awards. Regen SW, the renewables not-for-profit membership organisation presented New Earth with the award for "Best Renewable Energy Scheme" at a ceremony held in Bath.

The accolade went to the afore-mentioned Avonmouth energy recovery facility "which benefits from patented NEAT advanced thermal technology developed by New Earth". It was recognised by the judging panel as 'disruptive technology'. Depends what they meant by disruptive!

If anyone would like to add to the list of entrants named above then we'll be happy to hear from you and accommodate them if they pass the shame test. We know of a considerable number of financial advisers who persuaded investors to sink substantial sums - often including their hard-earned pension pots - in NERR, never to see a return.

A sizeable collection of distressing stories can be found on the Financial Services Ombudsman's website after unsuspecting clients were charged handsomely for completely worthless advice, and later found their wealth trapped in a suspended entity. Thankfully many of the complaints to the FSA were successful and the advisers were ordered to reimburse their 'victims' in full.

At the same time, as we've also reported here, the directors of the Premier Group Isle of Man, the outfit which controlled and managed NERR and a number of other investment vehicles, were raking in millions of pounds in management fees.

Our newly built Hall of Shame - the job was completed on time and under budget - is already becoming a bit overcrowded, but there's still room for a few more of your nominations.

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