HomeBussinessWhy ‘the UK’s biggest carbon emitter’ receives billions in green subsidies

Why ‘the UK’s biggest carbon emitter’ receives billions in green subsidies

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The cooling towers of the giant Drax power station loom over rural North Yorkshire as a reminder of Britain’s grimy past – and as a beacon of its efforts to create a net zero economy by 2050.

The power plant was once one of the largest coal-burners in Europe, and a lightning rod for campaigners against fossil fuels in the UK’s electricity system. Today, its owners claim to be the UK’s largest renewable energy power plant – burning 7m tonnes of biomass pellets a year to generate enough electricity that meets almost 4% of the UK’s power needs.

But this power plant’s green revolution is not without its sceptics. Green groups and climate scientists insist Drax remains the largest single source of carbon emissions in the UK, and that its FTSE 250 owners should not have been allowed to claim billions of pounds in renewable energy subsidies – more than £7bn in bill-payer-backed subsidies since work began to convert it to run on biomass in 2012.

The battle between the two camps has reignited as the government prepares to decide whether to extend a subsidy scheme that pays Drax about £500m a year from its 2027 deadline until the end of the decade.

The uncertainty has fuelled calls for ministers to review the evidence presented on both sides of the debate. Here, we take a closer look at the claims, the counterclaims, and the science behind Britain’s multibillion-pound bet on biomass.

What is biomass?

In power plants, compressed wood pellets can be burned in place of coal or gas to generate electricity. Drax burned about 6m tonnes of wood pellets at its North Yorkshire plant last year to generate electricity, which required about 12m tonnes of green wood – far above the UK’s total annual wood harvest, which is about 11m tonnes.

Chart showing top 10 emitters

As a result, about 80% of wood pellets used by Drax are imported from forests in the US and Canada, with the rest sourced from parts of Europe, including Estonia and Latvia. These forests are “sustainably managed”, says Drax, and the pellets are largely made up of the sawdust and offcuts generated as a byproduct when making higher value wood products, such as lumber and furniture. Still, more than a fifth of pellets used by Drax are from virgin trees – but Drax claims this is “low-grade” wood which would not be accepted by sawmills and might otherwise be left as waste.

What are its green credentials?

Drax insists its biomass generation is “carbon neutral” because the emissions produced from its chimney stacks are offset by the emissions absorbed by the trees that are grown to produce the pellets. This is backed up by the methodology for carbon accounting used by the UN’s Intergovernmental Panel on Climate Change, which expects the emissions from biomass to be taken on by the forestry sector, rather than the energy industry, to avoid double counting the carbon dioxide.

Drax plans to build on its green claims by fitting its power plant with carbon capture technology from 2030 to become the first power plant in the world to create what it claims will be “negative emissions”. It expects to receive subsidies from the government, paid via energy bills, for this work, and has lobbied for “bridging” support between the end of its current subsidy scheme in 2027 and its new subsidy stream to keep the business afloat.

The proposal is at odds with the government’s own climate advisers at the Committee on Climate Change, who have warned against handing further subsidies to large-scale biomass unless it is used in conjunction with carbon capture technology – a system known as BECCS (bioenergy with carbon capture and storage).

Are we sure it is ‘­carbon neutral’?

In short: no. The carbon accounting used to justify this claim is widely disputed in a rising number of scientific studies by European academics. They fear the lag between when the emissions escape from power plant chimneys and when new trees are able to absorb carbon will create a “carbon debt” which could accelerate the climate crisis in the near term.

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The European Academies’ Science Advisory Council found in a recent study that it could take between 30 to 50 years for biomass to make carbon emission savings relative to burning fossil fuels.

More than 500 scientists wrote to the leaders of the US and EU in 2021 to warn against relying on biomass to meet climate targets. The open letter said: “Regrowing trees and displacement of fossil fuels may eventually pay off this carbon debt, but regrowth takes time the world does not have to solve climate change.”

There are doubts, too, that the biomass industry is meeting its own standards. The UK’s National Audit Office found this summer that the government was unable to demonstrate that its current sustainability rules are adequate to provide confidence in the green credentials of biomass. More recently, the energy regulator admitted that Drax had “weak procedures, controls and governance” which had resulted in “inaccurate reporting of data about the forestry type and sawlog content being used” at its power plant. The company agreed to pay a fine of £25m for the breach.

Do we need it for net zero?

Again, there are conflicting views set out by authoritative figures. Drax points out that most forecasts which model the UK’s pathway towards net zero, including models from the Committee on Climate Change, show BECCS as a key source of clean energy. This is true, but it is also unsurprising given that biomass plays a part in the government’s energy policy. But could the UK reach its legally binding targets without relying on biomass? In the government’s biomass strategy paper, published last year, Prof Paul Monks, the energy department’s chief scientific adviser, said there would be “a need for negative emission technologies to compensate for areas where we cannot decarbonise completely”. In other words, the UK’s legally binding target to become a net zero economy by 2050 could be in jeopardy if it cannot rely on the claims made by Drax that its power plant will deliver “negative emissions”.

But it would not be impossible, according to the Committee on Climate Change. Its latest paper on biomass, published in 2018, said recent research had shown that pathways with a greater than 50% chance of limiting global heating to beneath 1.5C could be met without large-scale deployment of BECCS to provide negative emissions. The catch? This would be conditional on the “rapid implementation of ambitious” steps to reduce energy demand over the near term.

“These measures include substantial improvements in energy efficiency, shifts in diet, rapid electrification and low population growth. If many of these measures can be combined together, then the use of large amounts of bioenergy without CCS may also be avoidable,” it said.

So without a step change in approach to battling the climate crisis, biomass will need to be part of the UK’s plan to reach net zero targets – but could a net zero win on paper prove to be a hollow victory for the climate?

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