THE firm behind plans for a controversial biomass plant in Southampton has announced it is set to make redundancies as it struggles with financial problems.

It is the latest blow to hit Helius in recent weeks, adding mounting pressure on the company to scrap its plans for the city once and for all. Last month the Daily Echo reported how Helius was struggling to fund a similar plant at Avonmouth, near Bristol, sparking hope among residents fighting the plans for the 100MW plant for Western Docks that they would finally be dropped.

But despite its “tight cash position”, bosses at Helius have once again insisted they will continue with their proposals for Southampton.

The proposals for the £300m plant have been hanging over residents for years, and have led to concerns over pollution and the fact it may be located just yards from homes in Freemantle and Regents Park.

In October an unnamed investor pulled out of a deal at the last minute for the Avonmouth site, causing the firm’s share prices to tumble from 8p to 3.50p in a matter of weeks.

Now Helius has announced it intends to “reduce its operating cost base” after a major review.

Two senior officers at |the company, chief executive Dr Adrian Bowles and |commercial director Christopher Corner, have stood down and become “consultants” to save money.

In a statement, Helius said: “The company is consulting in respect of a redundancy programme to ensure maximum efficiency of its cost base, with the intention that the combined cost savings, after restructuring costs, will provide the company with working capital to February 2015.”

The statement added that the “company’s cash position remains tight”, and that additional finance may have to be raised if Helius cannot secure financing for the Avonmouth plant.

The news has led opponents of Southampton’s biomass scheme to again call for the plans to be scrapped.

Millbrook city councillor Steven Galton said: “We are cautiously optimistic that the company will never actually progress its Southampton plans any further.”

And Chris Hinds, from the West Docks Consultation Forum, said: “As far as people living in the vicinity of the docks are concerned, this news will be a good thing. I don’t think anybody wants it to be built, so it will be a relief if it doesn’t happen.

“There are major problems about pollution in the area anyway. Anything that adds to that can’t be a good thing.”

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.”