The directors present the strategic report for the period ended 31 December 2024.

The principal activity of GREP1 Limited (“the Group”) is the generation of electricity from renewable biomass fuels, primarily straw sourced from farms local to the Sleaford Renewable Plant. As well as generating electricity, the plant provides free heat to public buildings in Sleaford including the swimming pool, Primary School and North Kesteven District Council’s office. This also reduces CO2 emissions as heating for buildings such as the Council would otherwise be using natural gas fired boilers.

The key financial and other performance indicators during the year were as follows:

In the ordinary course of business, the group is exposed to and manages a variety of risks in relation to its activities. The management of risk is fundamental to the company, with the board of directors having responsibility for the overall system of internal control and for reviewing effectiveness.

The principal risks and uncertainties facing the group are broadly grouped as competitive, legislative, technical, revenue market, and financial instrument risk.

Competitive risk

The group is reliant on certain key suppliers for contracts which are subject to periodic competitive tender. Renewal of these contracts is uncertain and based on financial and performance criteria. The board continually monitors these arrangements as part of the routine operation of the business.

Legislative risk

The group operates two primary legislative frameworks. The electricity generation asset operates under a Licence granted from the Environment Agency and UK Health and Safety Legislation and Guidance. Systems and controls have been implemented by management to ensure compliance and provide ongoing assurance that its activities remain compliant with the various requirements. These frameworks are subject to continuous revision and any new directive may have a material impact on the ability of the company to operate successfully. In addition, compliance imposes costs and failure to comply with the standards could materially affect the company’s ability to operate.

Regulatory risk

Regulatory risk may arise from a change in regulations and law that might affect industry or business. Renewable energy projects are dependent for their commercial viability on a suitable regulatory regime. There is a risk that the government may introduce retrospective changes to the regime that was agreed at the time the project commenced. This is unusual in the market and changes to the regulatory regime are more typically for future projects.

Energy resource risk

Energy resource risk may arise if the amount of the renewable energy resource (straw) that is available for a given project is lower than the amount that is expected in the financial model. This risk is managed through close monitoring of straw levels held by local farmers and consideration of alternative fuel sources.

Technical risks

The group is exposed to technical risks with the operation of its biomass plant that could reduce availability for electricity generation, particularly with long lead times for certain components. To mitigate against this technical risk the group has contracted a team of experienced engineers who are responsible for monitoring and managing performance and advising on routine maintenance.

Revenue market risks

The group is exposed to the yields of the yearly straw harvest and changing market prices of electricity has a direct impact on the revenue and fuel and hence on profitability. These risks are managed by regularly updating the revenues forecast with the market price and straw harvest projections prepared by reputable consulting companies.

Customer offtake risk

The group is reliant on customers to offtake a certain quantity of heat in each calendar year in order for the plant to qualify under the CHPQA scheme for an additional 0.5 Renewable Obligations Certificates per MWh of electricity exported. Customer demand is uncertain and based on their operational criteria. The board continually monitors these arrangements as part of the routine operation of the business.

Financial instrument risks

The group has disclosed the financial instrument risks in note 13.

The financial statements reflect a profit before tax of approximately £10.2m, net current liabilities of approximately £52m and net assets of approximately £33m. The shareholder funding due at 31 December 2024 of £99m is included as a current liability which is the reason for the net current liability position at 31 December 2024. The inclusion as a current liability reflects the legal terms of the shareholder loans rather than the intention.

In this context the directors have performed a going concern assessment, including a review of the Group’s financial position, future operations, cash flow and covenant forecasts for the period to 30 September 2026. This assessment, which included stress testing of the forecasts, indicates that the Group will continue to be cash generative and meet its obligations as they fall due, including continuing to operate within its loan facilities for the period to 30 September 2026. The Group has received confirmation from its ultimate parent Greencoat Ceres Limited that it will not demand repayment of the loan or seek repayment of interest on this loan for at least a 12- month period from the date on which the financial statements are approved unless the Group has sufficient cash to finance its ongoing obligations. The directors have considered the financial position of Greencoat Ceres and are satisfied that they have the ability and intent to offer this support. Consequently, the Directors continue to adopt the going concern basis of accounting in preparing the Group’s financial statements.

The Group has considered the impact of the Government’s windfall tax on UK electricity generators, including renewables. The tax applies to revenue earned on power prices in excess of £75 per MWh, which is higher than the prices that underlying investments require to generate cash surpluses. As a result of this, the Manager does not consider the windfall tax has created any material uncertainty over the assessment of the Group as a going concern.

Based on the assessment outlined above, the Directors do not consider that there is a material uncertainty over the assessment of the Group as a going concern.

The directors will continue to maximise efficiency and generate as much electricity and profit subject to straw harvest, market influences on electricity prices and volatility in working capital. Management have implemented measures to secure sufficient fuel supply going forward. Research is ongoing regarding sourcing of suitable alternative fuel material.

The Directors are responsible for acting in a way that they consider, in good faith, is the most likely to promote the success of the Group for the benefit of its members. In doing so, they should have regard for the needs of stakeholders and the wider society, in both the short and long term. The Group's objective is to generate renewable electricity from the operation of its 39 MW straw fired biomass plant in Lincolnshire, United Kingdom whilst managing and mitigating the health and safety risks to those contractors and other stakeholders involved.

The Group engages with an independent health and safety consultant to audit the ongoing effectiveness of the Group's health and safety policies and the continued management and mitigation of health and safety risks. The Group also complies with all regulatory and planning conditions relating to the environment, including emissions to atmosphere, noise emissions, traffic management, habitat management and waste disposal, as well as engaging with the local community through sponsorships and annual contributions to community funds and social projects.

The Group also adopts a prudent approach to financial risk management to maintain and strengthen the Group's operations and business relationships with suppliers, customers, and other stakeholders. This is achieved through continuous monitoring of forecasted and actual cash flows and the retention of sufficient cash reserves to meet it ongoing obligations and mitigate against cash flow and liquidity risk.

Key decisions are those that are either material to the Group or are significant to any of the Group's key stakeholders. Any key decisions made or approved by the Directors during the year, were made with the overall aim of promoting the success of the Group while considering the impact on its members and wider stakeholders.

On behalf of the board

The directors present their annual report and group financial statements for the period ended 31 December 2024.

The principal activity of the Group continued to be that of the operation of a biomass electricity power plant.

The results for the period are set out on page 11.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

The directors who held office during the period and up to the date of signature of the financial statements were as follows:

Quantification and reporting methodology

The company’s approach to reporting is based on the GHG Reporting Protocol - Corporate Accounting and Reporting Standard. The GHG protocol is a multi-stakeholder partnership of businesses, non-government organisations, and governments, led by the World Resources Institute and the World Business Council for Sustainable Development. It serves as the premier source of knowledge on corporate GHG accounting and reporting and draws on the expertise and contribution of individuals and organisations from around world.

This information has been prepared following the 2024 UK Government Environmental Reporting Guidelines using the 2024 UK Government’s Conversion Factors and financial control approach.

Intensity measurement

SECR regulations require a statement of relevant intensity ratios which are an expression of the quantity of emissions in relation to a quantifiable factor of the business activity. The Company’s chosen intensity measurement is tonnes of carbon dioxide equivalent (tCO2e) per MWh of electricity generated.

Measures taken to improve energy efficiency

The company is reducing its energy consumption and carbon footprint by minimising wastage and by monitoring, and where practicable improving, plant efficiency.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgements and accounting estimates that are reasonable and prudent;

• state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

We have audited the financial statements of GREP1 Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 31 December 2024 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

• give a true and fair view of the state of the group's and the parent company's affairs as at 31 December 2024 and of the group's profit for the period then ended;

• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

• have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

• the information given in the strategic report and the directors' report for the financial period for which the financial statements are prepared is consistent with the financial statements; and

• the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

• the parent company financial statements are not in agreement with the accounting records and returns; or

• certain disclosures of directors' remuneration specified by law are not made; or

• we have not received all the information and explanations we require for our audit.

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

• Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud; 

• Reviewing minutes of meetings of those charged with governance;

• Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the entity through enquiry and inspection; 

• Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;

• Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias. 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation.  This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.  The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £7,751,693 (2023 - £8,868,054 profit).

GREP1 Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 1 London Wall Place, London, Greater London, England, EC2Y 5AU.

The group consists of GREP1 Limited and all of its subsidiaries.

The company has changed its reporting end date to align it with group reporting dates.

As a result, the reporting end date has changed from 30 September 2024 to 31 December 2024.

The finacial statements are presented for a longer period of 15 months which is not directly comparable to the prior period of 12 months.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

• Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

• Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

• Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;

• Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

The consolidated group financial statements consist of the financial statements of the parent company GREP1 Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

All financial statements are made up to 31 December 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

The financial statements reflect a profit before tax of approximately £10.2m, net current liabilities of approximately £52m and net assets of approximately £33m. The shareholder funding due at 31 December 2024 of £99m is included as a current liability which is the reason for the net current liability position at 31 December 2024. The inclusion as a current liability reflects the legal terms of the shareholder loans rather than the intention.

In this context the directors have performed a going concern assessment, including a review of the Group’s financial position, future operations, cash flow and covenant forecasts for the period to 31 December 2026. This assessment, which included stress testing of the forecasts, indicates that the Group will continue to be cash generative and meet its obligations as they fall due, including continuing to operate within its loan facilities for the period to 31 December 2026. The Group has received confirmation from its ultimate parent Greencoat Ceres Limited that it will not demand repayment of the loan or seek repayment of interest on this loan for at least a 12- month period from the date of approval of the financial statements unless the Group has sufficient cash to finance its ongoing obligations. The directors have considered the financial position of Greencoat Ceres and are satisfied that they have the ability and intent to offer this support. Consequently, the Directors continue to adopt the going concern basis of accounting in preparing the Group’s financial statements.

The Group has considered the impact of the Government’s windfall tax on UK electricity generators, including renewables. The tax applies to revenue earned on power prices in excess of £75 per MWh, which is higher than the prices that underlying investments require to generate cash surpluses. As a result of this, the Manager does not consider the windfall tax has created any material uncertainty over the assessment of the Group as a going concern.

Based on the assessment outlined above, the Directors do not consider that there is a material uncertainty over the assessment of the Group as a going concern.

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

At each reporting period end date, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

Provisions are recognised when the group has a legal or constructive present obligation as a result of a past event, it is probable that the group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

The preparation of the company’s financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for revenues, expenses, assets and liabilities, and the accompanying disclosures. In the course of preparing the company’s financial statements no judgements have been made in the process of applying the company’s accounting policies, other than in respect of those involving estimates as set out below. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in future periods. In the course of preparation of these financial statements, no judgements have been made in the application of accounting policies, other than in respect of those involving estimates as set out below:

(a) Decommissioning obligations

The group has recognised a provision for decommissioning obligations associated with the decommissioning of the plant and restoration of the site. In determining the fair value of the provision, assumptions and estimates are made in relation to discount rates, the expected cost to dismantle and remove the plant from the site and the expected timing of those costs. The carrying amount of the provision as at 31 December 2024 was £1,066,767. The company estimates that this liability will be realised in 15 years and has calculated the discount rate at 4.69% being the assessed risk free rate.

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

The group includes a provision for the degradation of straw stock due to the natural loss caused by weather conditions. The provision is based upon the condition of the straw at each year-end and observable past trends in yields from the straw. However, future weather patterns could impact the degradation of stock and hence the value of the provision needed in future years. At 31 December 2024 the provision applied is 20% (2023: 17%)

None of the directors of the group received any remuneration during the period (2023: £nil) in respect of their services to the company as their services to the company are deemed negligible and wholly incidental to their duties to other interests of the ultimate parent. Other than the directors the group had no employees in the current or previous financial period. Consequently, the amount of remuneration payable to key management personnel is £nil (2023: £nil).

The actual charge for the period can be reconciled to the expected charge for the period based on the profit or loss and the standard rate of tax as follows:

In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:

Included within the cost of plant and equipment is £14,298,724 (2023 – 14,298,724) of capitalised interest in respect of intergroup borrowings and £10,615,208 (2023 – £10,615,208) in respect of bank borrowings.

Details of the company's subsidiaries at 31 December 2024 are as follows:

The difference between purchase price or production cost of inventories and their replacement cost is not material. Inventories recognised as an expense in the period were £27,125,417 (2023 - 20,406,846).

Amounts due from group undertakings is interest free, unsecured and repayable on demand.

The company’s parent company, Greencoat Ceres Limited provided an unsecured loan to the company with interest payable at 6.74%. The loan is repayable on the earliest of demand or 30 September 2034. The Company has received confirmation from Greencoat Ceres Limited that it will not demand repayment of the loan or seek repayment of interest on this loan for at least a 12-month period from the date of approval of the financial statements, unless the Company has sufficient cash to finance its ongoing obligations

The interest-bearing loans and borrowings are secured by way of first ranking fixed and floating charges and/or assignment by way of security over all assets and undertakings of GREP1 Limited including (without limitation) accounts (including authorised investments), insurances, land and intellectual property. The interest rate applied to the loans is 1.11% and 2.6%

The bank loans have been fully repaid during the year.

At 31 December 2024 the company had interest rate swap agreements in place with a notional amount of total £0 (2023: £1,166,667) whereby the company pays fixed rates of interest of 1.484% and receives an interest rates equal to SONIA on the notional amount.

The decommissioning provision provides for the future costs of decommissioning the generation plant. The provision has been discounted at an annual rate of 4.69% and this discount will be unwound and charged to the profit and loss account until 2039, the estimated date of decommissioning.

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

The deferred tax assets set out above are expected to reverse within 12 months in relation to the power price derivative. A reversal is expected after 12 months and relates to the utilisation of tax losses against future expected profits and the relief of trade loan interest. The deferred tax liability set out above is expected to reverse after 12 months and relates to accelerated capital allowances that are expected to mature in future periods.

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

During the year the group entered into transactions in the ordinary course of business with other related parties. The group has taken advantage of the exemption under FRS 102.33.1A which states "Disclosures need not be given of transactions entered into between two or more members of a group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member."

The immediate parent undertaking is CEP Biomass Limited, a company incorporated in England and Wales. The ultimate parent company is Greencoat Ceres Limited, a company incorporated in England and Wales. The directors consider that there is no ultimate controlling party with Greencoat Wilton LP, Greencoat Renewable Income LP, Greencoat Tothill LP, Greencoat Solar I LP, and to Greencoat Carlisle Place LP together holding 100 percent of the shares in Greencoat Ceres Limited.

Copies of the financial statements of Greencoat Ceres Limited may be obtained from the registered office at 4th Floor The Peak, 5 Wilton Road, London, SW1V 1AN.