Biomass FAQ

- Last updated October 2014 -

This briefing is intended to provide detailed information about the effects of wood-based biomass electricity in the UK. If anything is not clear or your need information on something else we haven’t discussed, please drop us an email at biofuelwatch@ymail.com.

What is biomass?

How much Biomass is currently being burnt for electricity in the UK?

How many biomass power stations are proposed for the UK?

Does burning biomass destroy forests? How?

Isn’t it just waste wood or recovered wood which is being burned?

Does biomass pollute? How does this affect health and the environment?

Does biomass produce carbon dioxide? Is it as bad as fossil fuels?

But isn’t biomass carbon neutral?

Isn’t the government introducing rules under which only sustainable biomass will be subsidised?

What if developers promise to only source ‘sustainable’ or ‘certified’ wood?

What are scientific experts’ positions on biomass?

What are industries’ positions on biomass?

What is the UK Government’s position on biomass?

How efficient is biomass?

What about Combined Heat and Power biomass? Is this more efficient/green?

What about other campaign efforts around the country? Have they been successful?

Why is biomass classified as ‘renewable energy’?

How much Biomass does the UK Government want to use?

Why and how is biomass subsidised?

What subsidy levels are available for different renewable energy technologies?

How do I work out how much one biomass power station would make in subsidies each year?

What is biomass?

Biomass refers to any organic matter which contains energy. Biomass is defined by the EU as ‘the biodegradable fraction of products, waste and residues from biological origin from agriculture (including vegetal and animal substances), forestry and related industries including fisheries and aquaculture, as well as the biodegradable fraction of industrial and municipal waste’ (Renewable Energy Directive, Article 2(e).  This FAQ briefing focusses entirely on electricity from wood combustion, which accounts for the vast majority of biomass burned for energy.

How much Biomass is currently being burnt for electricity in the UK?

According to the most recent Ofgem data[1] , during the period of 2012/2013:

+ Around 3.9 million tonnes of biomass, mostly in the form of woodchips and pellets, were burnt to generate electricity during those 12 months. Note that 1 tonne of pellets translates into 2 tonnes of greenwood.

+ All imported wood for bioenergy has so far been burnt in coal power stations, (including the converted Tilbury B power station which was closed in August 2013). The much smaller dedicated biomass power stations continue to run on domestic feedstock, including roundwood, i.e. wood from whole trees. Please note that companies use quite different descriptions and only in some cases is it clear whether whole trees or residues were used.

+ In 2011/12 the UK imported 2.2 million tonnes of pellets and woodchip, whereas in 2012/13 this figure was 1.7 million tonnes, owing to the closure of Tilbury B. However, for the 2013/14 period we expect this figure to jump significantly, as Drax alone will have burned some 2.5 million tonnes (if not significantly more). By far the largest proportion of imported wood pellets for UK power stations came from Canada (1.72 million tonnes of pellets in 2011/12, 0.9 million tonnes in 2012/13). This was followed by just under 0.7 million tonnes of pellets from the US, which doubled from 2011/12 to 2012/13, and much smaller quantities from Portugal, South Africa and Latvia.

+ Drax continues to burn more biomass than any other company – the latest statistics available show that Drax burned 75% imported wood, which was a fifth of all wood imported to the UK for bioenergy. And, Drax’s first converted unit only came online towards the end of the period covered by the statistics, meaning that these numbers represent just a fraction of what will be burned in the future.

+ This graph shows just how much UK demand for wood pellets is driving growth in exports from the southern US – imports almost tripled between 2012 & 2013:

pellet exports graph


[1] https://www.ofgem.gov.uk/publications-and-updates/biomass-sustainability-dataset-2012-13

How many biomass power stations are proposed for the UK?

Please see our map of biomass power stations here. Demand for biomass is skyrocketing, with 8 biomass power stations 15 MW or larger in operation, 6 more under construction or about to be built and a further 40 proposed by companies.  This figure does not include the largest of all biomass power station schemes: The conversion of coal power station units to wood pellets. If all of the coal-to-biomass conversions with planning permission (excluding Tilbury B, which is closed) and all the new biomass power stations proposed by energy companies go ahead, around 66.3  million green tonnes of wood would be needed just for electricity generation in the UK. 

There are no more than 11 million tonnes of wood a year available in the UK (and that’s for use across all industries). Drax alone is in the process of converting half its capacity to wood pellets.  That would require pellets made from around 15 million tonnes of wood a year – almost 1.5 times as much as the total annual UK wood production.  Most of the imported wood for power stations currently comes from  British Columbia and the southern US.[1]

Southern US forests are rich in biodiversity, and are home to 130 species of trees, 595 species of birds, 246 species of mammals (including black bears and bobcats) 197 species of reptiles and 170 species of amphibians.[2] Now they are being targeted by pellet producers such as Enviva who supply both Drax and E.On’s Ironbridge power station. [3]

In British Columbia, too, biodiverse and carbon rich forests are being clear-cut and ever more wood is being removed from forests due to the growing demand for bioenergy. [4]  Now, the state government is trying to push through legislation which would hand over large areas of publicly owned forests to logging companies. [5]

Does burning biomass destroy forests? How?

On the current scale that we are demanding biomass, yes – and as demand rises, it will soon destroy forests on a far a greater scale than today.  The UK Government by its own admission estimates it will have to import at least 80% of the biomass burned in the UK by 2020. Demand for biomass is skyrocketing, with 40 power new power stations proposed across the UK. From Biofuelwatch’s monitoring of the different proposed power stations across the country [1], we’ve counted that demand is set to increase to up to 66.3 million tonnes of wood per year in the United Kingdom. We currently have around 11 million tonnes of wood available in the UK (and that’s for use across all industries).

The UK’s new demand for biomass will encourage an increase in logging of wildlife-rich forests abroad as well as new monoculture tree plantations, many of them at the expense of forests and the people who depend on them.

Isn’t it just waste wood or recovered wood which is being burned?

Many developers say they will only burn waste wood, which includes post-construction wood (such as wood panels etc) and forest residues (such as branches and logging debris) from UK sources which could not otherwise be used. There are a number of flaws in such arguments:

+ There is clear evidence that whole logs and trees are being chopped down to be processed into wood pellets to serve emerging biomass markets in the EU and the UK. US conservation organisation Dogwood Alliance has shown that pellet producers that supply UK power stations  are using whole trees for their pellets.  [1] And together with another US environmental NGO, NRDC, they have published evidence that Drax’s and E.On’s pellet supplier Enviva is targeting rare wetland forests in North Carolina. [2]

+ Greenpeace Canada’s 2011 report, “Fuelling a Biomess” [3] shows evidence that “Canadian provinces are diving into a “biomess” by opening the door to large scale clearcuts, salvage logging and highly damaging extraction practices that could double the forest industry’s footprint on already damaged forest ecosystems. Whole trees and large areas of forest are being cut to provide wood that is burnt for energy.”

+ A Freedom of Information request to DECC [4] has revealed that Drax advised them in May 2012 that for technical reasons they can only burn wood from slow-growing trees with a low bark content.  That rules out most residues, which are high in bark. Other types of biomass corrode their boilers.  The same will apply to all coal-to-biomass conversions in the UK. 

+ Even if this were not the case, it is not environmentally friendly to strip a forest of forest residues such as branches or forest litter, as it upsets the carbon balance and health of the forests. Such practices lead to lower carbon storage in soils and removing residues or forest debris from a forest reduces its ability to buffer acidity from acid rain and could lead in many cases to a decrease in productivity.

+ If we are talking about post-construction waste wood such as pallets and panels, according to WRAP, there were only 4.1 million tonnes of such wood post-construction wood in the UK waste stream in 2010. There is simply no way that all developers can source the majority of their wood from UK “waste” arisings.  Also most of this waste wood is already being used by other industries, such as the wood panel industry, who would otherwise have to either source virgin wood or move overseas.  The biomass industry is thus in direct competition with an industry which seeks to reuse the waste rather than simply burn it.


[1] http://www.dogwoodalliance.org/2012/11/new-report-discredits-uk-energy-company-claims-that-pellets-come-from-wood-waste/

[2] http://www.dogwoodalliance.org/2013/08/press-release-new-maps-reveal-envivas-ahoskie-wood-pellet-facility-threatens-southern-wetland-forests-surrounding-ecosystems-and-wildlife/

[3] http://www.greenpeace.org/canada/en/recent/Burning-trees-for-energy-puts-Canadian-forests-and-climate-at-risk-Greenpeace/

[4] http://biofuelwatch.org.uk/docs/DECC%20FoI%20EIR%2013-0340%20Q1%20Documents%20Drax%20etc%209May%202013.pdf

Does biomass pollute? How does this affect health and the environment?

Yes. Biomass Power Stations emit harmful pollutants into the atmosphere, and is considered to be as bad as using burning oil and worse than burning gas according to Environmental Protection UK. [1] These are some of the effects of the pollutants released by biomass combustion on human health:

- Nitrogen dioxide (NO2): can affect lung metabolism, structure, function, inflammation and host defence against pulmonary infections

- Carbon monoxide (CO): inhibits the blood’s ability to carry oxygen to vital organs such as the heart and brain.

- Particulates: PM exposure affects the respiratory and cardiovascular systems in children and adults and extends to a number of large, susceptible groups within the general population. There are no safe levels for small particulates PM2.5, meaning that the slightest emissions of PM2.5 from the power station can harm health.

- Sulphur Dioxide: Can result in breathing problems for asthmatic children, and shortness of breath.

- Heavy Metals and Dioxins and Furans: Toxic and carcinogenic to human health. There is nothing in to stop RES from burning chemically treated and thus even more toxic wood, too. However, even ‘clean’ untreated wood can contain high concentrations of heavy metals and burning it can release dioxins and furans.

According to a 2010 report by the UK’s House of Commons Environmental Audit Committee, up to 50,000 people a year may already be dying prematurely each year due to exposure to polluted air.[2] The previous UK Government commissioned data which showed that the air quality damage in terms of an increase in particulate emissions from biomass could result in the loss of up to 1,175,000 life years in 2020, costing the Government £557 million – just from small particulates. [3]

Pollution of this sort also has a strong impact on the natural environment.

Chapter 3 of our report “Biomass: the Chain of Destruction” details the community health impacts of burning biomass.


Does biomass produce carbon dioxide? Is it as bad as fossil fuels?

YES, it produces carbon dioxide. Per unit of energy produced, smokestack CO2 emissions from biomass power stations are on average 50% higher than those from coal power stations. This is because wood is less energy dense than coal.

The Government’s own analysis reveals that burning biomass can be worse for greenhouse gas emissions than the fossil fuels they are seeking to replace. This was exposed in a 2012 report from Friends of the Earth, Greenpeace and the RSPB entitled “Dirtier than Coal”.[1]

DECC has also recently released a report on life-cycle emissions of biomass electricity. [2] It uses various scenarios to assess how carbon intensive the different sourcing options are – of the 29 scenarios examined, in terms of carbon emissions, 16 wouldn’t meet current emissions targets for biomass, 11 have higher emissions than gas, and 6 have higher emissions than coal. Scenario 13 for example directly relates to pellets produced by Drax’s southern US supplier Enviva. Whilst Drax and Enviva say that these pellets are “low carbon”, DECC’s calculator shows that they result in emissions three times grater than are produced by burning coal at Drax. The infographic below highlights this point.

Drax supply-chain infographic


[1] http://www.rspb.org.uk/images/biomass_report_tcm9-326672.pdf

[2] https://www.gov.uk/government/publications/life-cycle-impacts-of-biomass-electricity-in-2020

But isn’t biomass carbon neutral?

Developers like to say that burning biomass is carbon neutral, because the wood burned absorbed carbon dioxide from the atmosphere as it was growing. But the reality is that because biomass contains carbon, naturally, when it is combusted, it releases all of that carbon dioxide into the atmosphere. This carbon debt is only paid back if and when a tree or crop is fully grown to replace what was chopped and if soils and other vegetation destroyed or harmed during logging re-absorb all the carbon they had lost. This may take decades and even centuries. What’s more, when forests and other natural ecosystems are too damaged to fully recover or, worse still, turned into monoculture tree plantations, the carbon emitted in the process will never be re-absorbed.

Currently, biomass is also considered to be essentially ‘carbon neutral’ by the UK Government. The result of this is that developers produce figures which show carbon emissions savings that completely overlook the actual carbon that is release into the atmosphere. The European Environment Agency Scientific Committee has warned the assumption that biomass is carbon neutral is a ‘serious accounting error’ and that using biomass can result in increased carbon emissions and thereby accelerate global warming, and recommended that governments must rectify this situation as soon as possible.[1]

Aside from the carbon emitted when biomass burns, importing biomass from across the world produces emissions from transporting and processing the fuel as well. And healthy forests play a major role in regulating the rainfall cycle, storm tracks and the nitrogen cycle, too, all of which are vitally important for a stable climate.


[1] European Environment Agency Scientific Committee, ‘Opinion of the EEA Scientific Committee on Greenhouse Gas Accounting in Relation to Bioenergy’ (September 2011), available at http://www.eea.europa.eu/about-us/governance/scientific-committee/sc-opinions/opinions-on-scientific-issues/sc-opinion-on-greenhouse-gas/view

Isn’t the government introducing rules under which only sustainable biomass will be subsidised?

The government has announced that from April 2015 only biomass that meets new sustainability standards will receive subsidies (except for some biomass burned in small installations, and the introduction of these standards has been delayed twice).  Unfortunately, these sustainability standards will be effectively meaningless:

+ Subsidised biomass is supposed to deliver at least 60% greenhouse gas savings compared to fossil fuels, but when calculating those supposed ‘savings’, the government is ignoring the bulk of carbon emissions that results from wood-based bioenergy.  CO2 emissions from actually burning the biomass are ignored, as is the loss of carbon from forests when they are logged or converted to plantations.  DECC’s  Scientific Advisor has recently published an evidence-based ‘carbon calculator’ (see above), to determine what the climate impact of different types of biomass energy is, but DECC has already announced that this will be ignored for the purpose of subsidies until at least 2027. [1]

+ The standards rely heavily on different voluntary forestry certification schemes, but these cannot guarantee that certified wood is not linked to even the worst environmental and human rights abuses, such as clearcutting of oldgrowth forest and large-scale evictions.  [2]

+ The standards will rely on company self-regulation.  There is no regulatory body to check whether what company’s are reporting is actually true.  As we know for example from the horsemeat scandal, simply trusting complex company information on ‘chain of supply’ is very risky and often companies themselves don’t know for sure where their ‘produce’ is coming from.

+ The sustainability criteria do not address the crucial sustainability of the overall demand for wood.  Excessive demand for wood is already one of the main underlying causes of deforestation and forest degradation today.  Burning wood on the scale proposed in the UK (which would require nearly 8 times the volume of the UK’s annual wood production every year) is inherently unsustainable and no standards can change this fact. [3]

For in depth information on this, please read our September 2012 report, “Sustainable Biomass: A Modern Myth”.[4]


 [3] http://www.globalforestcoalition.org/wp-content/uploads/2010/11/Report-Getting-to-the-roots1.pdf

[4] http://www.biofuelwatch.org.uk/2012/biomass_myth_report/

What are scientific experts’ positions on biomass?

Most scientists agree that biomass is not automatically carbon neutral and that the full life-cycle impacts should be taken into account – including the ‘carbon debt’, i.e. the time lag between carbon being released from burning wood and new trees  and vegetation potentially reabsorbing that carbon again.

For example, the European Environment Agency Scientific Committee: (agency of the European Union devoted to the monitoring of the European environment) stated in its published opinion in 2011 that the assumption that biomass is carbon neutral is a ‘serious accounting error’ and that using biomass can result in increased carbon emissions and thereby accelerate global warming, and recommended that governments must rectify this situation as soon as possible. [1]

Biofuelwatch has compiled a list of key scientific articles and opinions which is regularly updated. [2]

What are industries’ positions on biomass?

Developers stand to gain lots of money, so they claim it is green, clean, and provides jobs. Note that developers British Sugar, Drax. E.ON, Future Biogas, Estover Energy and RES Group launched the Back Biomass campaign in 2011 which successfully persuaded the UK Government to guarantee long-term subsidies for biomass electricity (although those guarantees could still be reversed if there was the political will).  The Back Biomass campaign is coordinated by Renewable Energy Association, the body which represents renewable energy producers in the UK and has resulted in the Government promising to continue to offer financial support for biomass.

On the other hand, UK timber industries such as the Wood Panel Industries Federation and the Confederation of Forest Industries have strongly warned against the steeply increased demand for biomass from the UK, because it will push up timber prices, make UK industries that depend on wood unviable, thus destroying far more jobs than created through bioenergy (and ensuring that virtually all other wood and paper are sourced from abroad in future).[1]


[1] CONFOR and Wood Panel Industries Federation, ‘Wood fibre availability and demand in Britain 2007 to 2025’ (May 2010), available at http://www.confor.org.uk/Upload/Documents/37_WoodFibreAvailabilityDemandReportfinal.pdf

What is the UK Government’s position on biomass?

In July 2012 the UK Government announced, as part of its review on financial supports for Renewable Energy that it would continue to offer generous subsidies to Bioenergy. The subsidies will artificially stimulate the market to new staggering heights, with Bioenergy expected to play a key role in the Government’s ability to hit its 2020 Renewable targets. This is rather ironic given that the Bioenergy Strategy also acknowledges that Bioenergy can produce more Greenhouse Gas Emissions than coal for a period of over 50 years (for more information on this, see Friends of the Earth et al’s report).[1]

The Government insists that bioenergy coming into the UK will be “sustainable” according to new sustainability standards which will come into force in 2015. However, the sustainability standards do not take into account crucial greenhouse gas accounting issues including factoring in the Carbon Debt associated with bioenergy, or emissions from indirect land use change. They are ill-equipped to ensure that human rights violations e.g. land grabs are not implicated with companies’ sourcing of biomass. What’s more, there is no independent auditing of companies’ claims to be sourcing only “sustainable” materials. Finally, the overarching problem is that a reliance on sustainability standards is merely serving to legitimise the unabated expansion of an industry which is by its nature less sustainable the larger it becomes.

DECC has a 400 MW cap on the amount of electricity from new electricity-only biomass power stations that they want to subsidise under the Renewables Obligation.  Crucially, the cap doesn’t include coal-to-biomass conversions (the biggest schemes by far) and they also allow an easy get-out for companies building new power stations: Any biomass power station that achieves a mere 35% efficiency and that makes use of a tiny fraction of its heat is classed as ‘good quality combined heat and power’ and not just exempt from the proposed cap but eligible for an even higher rate of subsidies.

Further still, a new system of subsidising renewable energy, Contracts for Difference (CfD), is replacing the RO scheme. Theoretically, new-build electricity-only biomass power stations are excluded from subsidies under the new rules (as are bioliquid plants). But, as described above, the “CHP loophole” actually means that most dedicated biomass power stations that are electricity-only in every aspect except name will still be eligible. There’s only been one round of CfD allocations so far and already three biomass plants have been given support: the Drax and Lynemouth coal conversions and MGT’s Teesside dedicated plant. Between them, they’ll be eligible for over half a billion pounds for burning 11.8 million tonnes of wood a year. So just in the first allocation round, already DECC have awarded subsidies – paid for by bill payers of course – for burning the equivalent of more than the UK’s entire annual wood production. For more information on CfDs please see our briefing. [1]

Back to the RO, the Scottish Government has introduced a rule under which no electricity-only biomass power station larger than 15 MW will be subsidised. But, they offer the same exemptions as DECC, so this rule is also effectively meaningless.[2]  Indeed, the Scottish Government recently approved two 100 MW import-reliant new biomass power stations in Grangemouth and Rosyth which are unlikely to supply more than a small fraction of heat.


[1] http://www.biofuelwatch.org.uk/2014/cfd-briefing/

[2] http://www.foe-scotland.org.uk/news070213

How efficient is biomass?

trees imageElectricity from biomass is extremely inefficient. Even DECC notes that biomass power stations today are only 25% efficient, with 75% of the energy potential of the fuel wasted.[1] Rarely, more than 30% efficiency is reached unless some of the heat is recovered and used. Coal-to-biomass conversions may reach 35-37% efficiencies but that only refers to conversion efficiency.  Those power stations can only burn powdered wood pellets and large amounts of energy are needed to dry wood, grind it into dust, compress it into pellets and then grind it up again.  Note that under EU law, the UK is meant to be promoting biomass technologies which provide at least 70% efficiency rates.[2]


[1] DECC Consultation, ‘Heat and Energy Saving Strategy’ Chapter 7: Combined Heat and Power and Surplus Heat paragraph 7.2, available at http://hes.decc.gov.uk/consultation/download/index-32178.pdf

[2] EU Directive 2009/28/EC (‘Renewable Energy Directive’), Article 13(6), available at http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:140:0016:0062:en:PDF

What about Combined Heat and Power biomass? Is this more efficient/green?

The energy produced from a biomass power station is heat, which is then converted into electricity. As mentioned above, currently biomass is very inefficient. If the heat can be captured and used to warm homes and buildings, then this makes a more efficient use of the biomass. A lot of companies rely on vague promises that they can supply heat to promote themselves as really green. However, whilst it is true that making use of heat as well as electricity is a better than using it as electricity only:

- It is worth questioning how much heat they intend to supply. If it is a small fraction of the overall megawattage capacity of the plant, then it won’t necessarily make the plant that much more efficient. The Government offers extra subsidies for power stations which achieve anything over 35% efficient, and classifies them as “Good Quality Combined Heat and Power.” This is a complete misnomer: power stations can achieve 35% efficiency by delivering nominal and in some cases no heat to external customers. 35% efficient is actually even less efficient than many modern day fossil fuelled power stations.

- Although theoretically CHP could be more efficient than electricity, all the other environmental concerns remain. That developers might supply heat will not undo the fact that they will source its wood from across the world, cause massive transport emissions, increased carbon emissions from combustion, pollution, and will impact on the local natural environment.

- Often promises to supply heat are in fact unsubstantiated and no more than PR stunts. They rely on there being in place district local heating networks, which are currently underdeveloped across the UK and which require a lot of investment. Given the cuts, there is little chance of local authorities being able to pay for heat distribution.

What about other campaign efforts around the country? Have they been successful?

There are several other campaigns in the UK at the moment. Several have succeeded in getting power station applciations rejected (e.g. for a 50 MW power station in Swansea or a 40 MW power station in Mid  Suffolk) or withdrawn by developers (e.g. for a 50 MW power station in Kidwelly, Wales, for a 200 MW power station in Leith, for a 100MW power station in Dundee and for an 80 MW power station in Barrow-in-Furness).

Even if campaigns don’t succeed through the planning system, vocal public opposition can sometimes put off investors.  In Port Talbot for example, an active local campaign group could not stop Prenergy from getting planning permission for a huge 350 MW biomass power station in 2007 but they have prevented them from getting changes to that permission that would have made it more attractive to investors. No investor has come forward and no other company has offered to buy the project since then. 

If you would like to become a member of an emailing list on biomass resources, please contact biofuelwatch@ymail.com with ‘Biomass Action Network emailing list’ in the subject header.

Why is biomass classified as ‘renewable energy’?

Around ten years ago, new thinkers really thought that biomass and biofuels could be the energy for the future. The idea of ‘renewability’ was that you can harvest trees and regrow them. This myth has long been disproved. In reality, large-scale industrial biomass burning is a particularly polluting form of energy harmful to forests, people and the climate.

However, according to the law, under the EU renewable energy directive, biomass is an eligible source of renewable energy which can be subsidised and promoted on an unprecedented scale.

Biomass therefore is also classified as renewable energy in the UK, and currently accounts for a large share of the UK’s so called ‘renewable energy’.[1] In reality, biomass allows energy companies to attract vast subsidies for dirty energy falsely classed as ‘renewable’, rather than having to invest in genuinely renewable energy such as sustainable wind and solar power.


[1] DECC Report, ‘Digest of United Kingdom Energy Statistics 2011: Chapter 7: Renewable sources of energy’, available at http://www.decc.gov.uk/assets/decc/11/stats/publications/dukes/2309-dukes-2011-chapter-7-renewable-sources.pdf, page 190

How much Biomass does the UK Government want to use?

The United Kingdom government has a target to provide 15% renewable energy by 2020, and is bound by EU law to do so. According to the UK Bioenergy Strategy [1], bioenergy could meet 8-11% of total primary energy demand in the UK in 2020.  Most of this would be wood-based bioenergy, though biofuels are also included in the figure.  This means that the vast majority of the renewable energy target would be met from burning wood.  The government admits that this would rely to 80% on imports.

Why and how is biomass subsidised?

The United Kingdom government has a target to provide 15% renewable energy by 2020, and is bound by EU law to do so. One of the ways to make sure that it provides renewable energy is to offer financial incentives to electricity suppliers. It has done this first through the Renewable Obligation Order (RO), and more recently through Contracts for Difference (CfD), which will replace the RO. Under the RO, suppliers are obliged to supply a percentage of their electricity from renewables, which increases year on year. A penalty is imposed on suppliers who do not meet the targets. Correspondingly, Ofgem issues Renewables Obligation Certificates (ROCs) to electricity generators in relation to the amount of eligible renewable electricity they generate. So, in essence, this operates to the effect that suppliers can buy and sell their way out of the renewables requirement. For each megawatt of renewable electricity provided, suppliers gain a number of ‘Renewable Obligation Certificates’ (‘ROCs’). The number of ROCs per megawatt varies, depending on which renewable technology is used (see table below). ROCs have a market value which has on average been £42.87 over the last 12 months, up to October 2013. [1]

The ROC scheme is financed not by the public purse, but through levy on our fuel bills – we are effectively paying more money on our fuel bills to subsidise the scheme. Whilst this might make sense in the case of genuine renewable energy technologies like wind and solar and tidal – in the case of biomass and bioliquids – it’s pretty shocking. Effectively, the ROC trading scheme operates to heavily subsidise energy companies. For biomass, what it means is that we are paying more expensive electricity bills to finance more carbon emissions, more deforestation, land grabs, and increased global food prices.The RO will close to new generation on 31 March 2017 – but for any planning applications which open before then, they will receive full support under the RO until 2037.

A new subsidy scheme, Contracts for Difference, is currently being phased in, and if the RO sounds like a bit of a scam, at least as far as biomass is concerned, CfDs are surely worse. Under CfDs, generators can bid for a guaranteed “strike price” for their electricity, and maximum strike prices have been set for different forms of energy. Biomass “CHP” will get up to £125 per MWh, whereas coal conversions can get up to £105. Considering that the average wholesale price currently is around £45/MWh, that’s more than double what they would otherwise get, and more lucrative than under the RO. Electricity suppliers have to pay this strike price to producers, who then pass these costs on to consumers through increased bills. Many electricity producers in the UK are also suppliers, so it’s obvious who stands to gain from this arrangement.

Theoretically, new-build electricity-only biomass power stations are excluded from subsidies under the new rules (as are bioliquid plants). But, the “CHP loophole” actually means that most dedicated biomass power stations that are electricity-only in every aspect except name will still be eligible. There’s only been one round of CfD allocations so far and already three biomass plants have been given support: the Drax and Lynemouth coal conversions and MGT’s Teesside dedicated plant. Between them, they’ll be eligible for over half a billion pounds for burning 11.8 million tonnes of wood a year. So just in the first allocation round, already DECC have awarded subsidies – paid for by bill payers of course – for burning the equivalent of more than the UK’s entire annual wood production. Future rounds of CfD allocation will involve competition, but the rules have been rigged in favour of big biomass – dedicated plants will only need to compete with “less established technologies”, giving them a serious advantage over onshore wind for example, and coal-biomass conversions have been given their own category, so won’t have to compete with other technologies at all. For more information on CfDs please see our briefing. [2]


[1] http://www.e-roc.co.uk/trackrecord.htm

[2] http://www.biofuelwatch.org.uk/2014/cfd-briefing/

What subsidy levels are available for different renewable energy technologies?

The Renewables Obligation:

For each megawatt of renewable electricity provided, suppliers gain a number of ‘Renewable Obligation Certificates’ (‘ROCs’). The number of ROCs per megawatt varies, depending on which renewable technology is used. [1] The vast bulk of capacity is in the Coal to Conversions category highlighted in red and receiving 1 ROC per megawatt until 2017 when the Contracts for Difference subsidy regime comes into operation. Note the vast incentive to find a way to do ‘efficient CHP’ which in practise means anything over 35% efficiency (as at Grangemouth) when efficiencies of 70% + are possible if a real use for the heat is designed in. See CHP section above. Drax will be operating at 38% efficiency with no heat capture!

Band 13/14 support (ROC/MWh) 14/15 support (ROC/MWh) 15/16 support (ROC/MWh) 16/17 support (ROC/MWh)
Co-firing (low- range) 0.3 0.3 0.5 0.5
Co-firing (mid- range) * 0.6 0.6 0.6 0.6
Co-firing (high- range) * 0.7 0.9 0.9 0.9
Co-firing (low-range) with CHP* 0.8 0.8 1** 1**
Co-firing (mid-range) with CHP* 1.1 1.1 1.1** 1.1**
Co-firing (high-range) with CHP* 1.2 1.4 1.4** 1.4**
Co-firing of regular bioliquid 0.3 0.3 0.5 0.5
Co-firing of regular bioliquid with CHP 0.8 0.8 1** 1**
Co-firing of relevant energy crops (low range) 0.8 0.8 1 1
Co-firing of relevant energy crops with CHP (low range) 1.3 1.3 1.5 1.5
Conversion (station or unit) 1 1 1 1
Conversion (station or unit) with CHP 1.5 1.5 1.5 1.5
Dedicated biomass 1.5 1.5 1.5 1.4
Dedicated biomass with CHP 2 2 1.9 1.8
Dedicated energy crops 2 2 1.9 1.8
Energy from waste with CHP 1 1 1 1

Contracts for Difference:

Dedicated “biomass combined heat and power” (CHP) plants will be eligible for £125 for each MWh whilst biomass conversions (coal-to-biomass) will qualify for £105 per MWh, to be increased with inflation. By comparison, onshore wind will get £95 per MWh, reduced to £90/MWh in future and solar PV will initially attract £120/MWh, but that will be gradually reduced to £100/MWh.3 By means of another comparison, DECC has also announced that EDF’s Hinkley Point C nuclear power stations will receive a strike price of £92.50/MWh. [2]

This means that a power station conversion like Drax will be treated even more favourably than new nuclear power, despite the fact that the capital costs are much lower, and indeed the required finance for the conversion has already been fully met.

This level of support shows just how desperate the UK Government is to make biomass electricity a significant part of its “renewable energy” capacity.


[1] Department of Energy and Climate Change summary of ROCs banding for all renewables https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/211292/ro_banding_levels_2013_17.pdf

[2] https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/263937/Final_Document_-_Investing_in_renewable_technologies_-_CfD_contract_terms_and_strike_prices_UPDATED_6_DEC.pdf

How do I work out how much one biomass power station would make in subsidies each year

It’s pretty basic maths – you’ll need to know the following:

- The MW capacity of the power station (e.g. 70MW)

- How many hours each year the power station is expected to operate (this could be in the Environmental Statement, but if not then we use a standard 8000 hours per year for dedicated plants, or 7000 for conversions)

- Whether the power station will get ROCs or a CfD

- How many ROCs per MWh the power station will pick up or what strike price the power station has been given a CfD for (this depends on the sort of biomass power station – is it a coal conversion, electricity only, or “CHP”? e.g. if it is CHP, it will get 2 ROCs/MWh. For more info, See “What subsidy levels are available for different renewable energy technologies?”)

- What the current value of a Renewable Obligation Certificate is: for the 12 months to October 2013, it has been averaging at £42.87. We use http://www.e-roc.co.uk to keep track of the value of ROCs. Then multiply these all together to work out how much money one power station will make.

E.g. if we are talking about a 70MW biomass power station classed as CHP…

under ROCs it would get:

70 (MW capacity) x 8000 (hours it will operate in a year) x 2 (ROCs per MWh generated) * £43.10

= £48,272,000 in one year – in subsidies alone.

or with a CfD it would get:

70 (MW capacity) x 8000 (hours it will operate in a year) x £125-£45 (strike price minus current wholesale price)

= £44,800,000 in one year.

NB: Above we’ve said that CfDs are more lucrative than ROCs for biomass, but the figure above shows the opposite. For dedicated biomass plants the levels of subsidy are very similar, but by 2016/17 CfDs become more lucrative as the strike price doesn’t reduce over time, whereas the number of ROCs does. For coal-to-biomass conversions however, CfDs are considerably more valuable to power station operators than ROCs.

Comments are closed.