Tata Chemicals Europe is to get gas from Gazprom Energy for the chemical factory it recently bought in Cheshire.

Under the new deal, the chemical plant will take gas for its on-site power plant and sell back any excess power to the business energy supplier.

The Combined Heat and Power (CHP) plant produces steam and electricity which is used in Tata’s manufacturing processes at two sites in Northwich – Lostock and Winnington.

Soda ash and sodium bicarbonate are made here for a range of industries including pharmaceutical, food, glass and detergent manufacturers.

On Monday Tata closed its soda ash-making facilities in Winnington to keep these two other sites open. When it announced the move last October Tata blamed it on “the serious threat posed by high and rising energy prices”.

Mark Jackaman, Commercial Manager for Energy at Tata Chemicals Europe said energy costs represent one of the “most significant challenges” for the business.

Andrew Morris, Manager of Clean Energy at Gazprom Energy added CHP is a “popular” choice for the UK industrial sector.

He said: “With energy costs continuing to be a primary concern for UK industrial businesses, more and more are opting to become generators themselves… [CHP] allows businesses to avoid the need to import additional electricity to power industrial processes.”

The CHP plant currently uses up to 120 million therms of gas. It could potentially export up to 99MW of power. Both the gas and power will be traded exclusively through Gazprom Energy during the one-year contract.