The staff at the plant are to retain their jobs

The Holsworthy Biogas complex in north Devon converts animal and food waste into renewable electricity for the National Grid and bio fertiliser.

The plant went into administration after problems generating working capital for new plant and equipment.

But it has been bought by Summerleaze and all 13 staff are to be kept on.

Plant upgrading

The plant is also expected to continue generating electricity for the local grid.

Summerleaze is a family-owned group of waste management companies, based in the Thames Valley for more than 50 years.

Summerleaze managing director Peter Prior said: "The Holsworthy plant is important to the local area, and especially to its farming community, who have an important part to play in the future.

"To ensure the plant's survival and its future economic viability, we have set aside funds for the modification and upgrading of the plant to enhance its operational capability and to ensure it meets regulatory requirements."

Simon Michaels, of administrators BDO Stoy Hayward, said: "We are delighted to have found a purchaser for Holsworthy Biogas - so far the only plant of its kind in this country - and that both the business and jobs have been saved."

The Holsworthy plant is capable of generating 2.2 megawatts of electricity per hour which is sufficient to maintain 1,000 households.

The plant, which began operating in May 2003, produces electricity by using methane produced from locally-collected farm waste to power generators.