CAMPAIGNERS say they have fresh hope that a controversial biomass plant being planned for Southampton could be set for the scrapheap.

Weeks after it was revealed that Helius was struggling to fund a similar plant near Bristol, news that an investor has pulled out of a deal to fund the project has caused share prices to tumble.Opponents of the firm's Southampton plans say the continuing uncertainty casts further doubt over the proposals for a 100-megawatt (MW) plant in the Western Docks.

As previously reported, Helius' plans for a 100 MW plant at Avonmouth near Bristol ran into difficulty earlier this year, with the company struggling to find funding.

An unnamed company had been named as the financial partner - but that firm has now pulled out, causing Helius' share prices to plunge from 8p to 3.50p in the space of a fortnight.

Helius's proposals for a £300million wood-fuelled plant in Southampton have been fiercely opposed by residents living near the proposed site and politicians.

The city council also voted last year not to buy any heat produced by the plant.

Despite the struggle to push through the Avonmouth scheme - which has planning permission - Helius has again insisted it intends to hand in plans for a Southampton plant.

As yet, no planning application has been put forward for the scheme, which would have to go through the Government's National Infrastructure Directorate for permission from ministers in Whitehall.

A spokesman said: “The company continues to work on preparation of a amended scheme, which will be used as the basis for a full application to the National Infrastructure Directorate of the Planning Inspectorate for a Development Consent Order.”

Freemantle city councillor Jeremy Moulton said: “Helius' latest financial troubles will cast further doubt over their Southampton project.

“If Helius are struggling to get financial backing for Avonmouth then this is a good sign that the Southampton scheme won't get off the ground.

“Locally we have made it clear to Helius they will have a huge uphill battle if they want to build their massive power station in the docks and the city council have already ruled out partnering with them to purchase the heat.

“This will hopefully make it a very unattractive prospect to any future financial backers for Helius in Southampton.”

And anti-biomass campaigner Eloise Gil-Arranz said: “They've been quiet for quite a long time, but obviously the facts aren't looking good for them at the moment if they want to progress with anything.

“No news is good news at the moment.”