One of the UK’s largest power plants could lose public funding following Ofgem’s investigation into alleged green laundering.
Drax, which generated 11% of Britain’s electricity in 2019, is under regulatory investigation after allegations it burned wood from old-growth forests to generate electricity.
The company began converting its large coal-fired power plant in Yorkshire to biomass in 2010, receiving hundreds of millions of pounds annually in green energy grants.
Wood pellet electricity has been declared by Zero Energy Minister Graham Stewart as ‘vital to this country and our net zero strategy’ for UK energy security and the transition to ‘green’.
However, Ofgem’s scrutiny could see it stripped of all environmental subsidies if it faces the heaviest penalty, which deprives the company of more than £800m a year.
Investigation last year BBC Panorama testified that Drax cleared the jungle in Canada, claiming that most of his pellets were made from sawdust.
The use of wood from forests that have never been cleared casts doubt on Drax’s claims of carbon neutrality, as it is scientifically impossible to replace the ability of old trees to capture carbon with new trees.
Primal forests, also known as old wood, offer an indispensable habitat for hundreds of species. Only a third of the world’s forests are pristine, uncut forests. In British Columbia, where Drax bought some of his forest to burn, less than 1 percent of the original forest remained intact.
British Greenpeace called the policy “stupid self-destructive”.
This was announced by a source in Ofgem. I that Drax was subject to an additional “assessment” of its revolving commitment following criticism of the company.
Some of the sanctions under consideration appear to include the cancellation or withholding of permits for renewable obligations.
This may result in Drax losing access to some or all grants. Company insiders warned that the removal of subsidies could jeopardize the company’s entire business model, which relies on government support.
Drax received a total of £885m in grants in 2021, representing over 10 per cent of total revenue and six times the profit. Drax reported a profit of just £146m in 2021 on sales of £7.7bn.
Less severe penalties include the removal of subsidies and fines.
DR said Doug Parr, Chief Scientist at Greenpeace UK I: “Many groups, including Greenpeace, have long believed that there are great risks in international large-scale wood burning due to the temptation to switch from burning wood waste to using virgin forests as a fuel source.
“This could lead to the UK burning forests to save the climate, which is as wrong and stupidly self-destructive as it sounds. If Drax used “green” subsidies to pay for deforestation, then they deserved the economic problems they faced, both because of the loss of subsidies and because of the remaining faith in their “green laundering”.
The investigation is part of a wider freeze on government relations with Drax.
Drax skipped the “Phase 1” carbon capture plan announced last week and has delayed the project in North Yorkshire until at least 2025. Following the news, Drax’s share price fell by about 10 percent. The government then backed the company under pressure from shareholders.
City sources believe the government has abandoned its biomass strategy, from a major energy security announcement last week to being sensitive to Drax.
Activists reacted positively to the audit when they were briefed on the events I.
Almut Ernting of Biofuelwatch, who filed a lawsuit to force Ofgem to look into Drax’s renewable energy commitments, said I“It’s great to hear that Ofgem is finally investigating evidence that Drax obtained wood from clearing biodiverse old growth forests in British Columbia, which appears to be very difficult to reconcile with the UK biomass sustainability standards that are being maintained. grant procedure.
“However, it is important to remember that supplies of Drax pellets from other regions, including the US Southeast and the Baltic States, are also causing severe damage to forest ecosystems and causing serious environmental injustice to underserved, predominantly black communities in parts of the South.” The United States is a bound state.
“In addition, the actual climate impact of burning wood in power plants is no less than that of burning coal. Therefore, we want the government to completely withdraw the Revolving Commitment Certificates (ROCs) received from Drax and refrain from further grants, regardless of Drax’s commitment to carbon capture.”
ROCs are official guarantees that energy producers produce green electricity, which gives them access to subsidies.
A 2017 study by think tank Chatham House found that burning biomass is generally worse for carbon emissions than burning fossil fuels.
Drax hopes to be able to use carbon capture technology and capture CO2 emissions underground. However, this technology is largely unproven and does not compensate for the destruction of the declining habitat of older herds.
Ofgem spokesman said: I that the oversight body cannot comment on active investigations.
A Drax spokesperson said the company does not consider the audit part of a formal investigation.
A spokesperson said: “We receive regular inquiries from Ofgem and they also conduct regular checks from Drax to ensure we are meeting our obligations under the ROC and guarantees of origin for renewables.
“We take all Ofgem’s requests very seriously and are committed to ensuring that the biomass we produce delivers positive results for the climate, wildlife and communities in which we operate.”
Why the UK is burning wood for electricity
The UK’s drive towards renewable energy is focused on offshore wind and solar power. But the need to act quickly and ensure a reliable and weather-independent energy supply has also spurred the use of biomass.
The technology takes many forms, but most often involves burning fast-growing grass and wood from the forest.
It provides a constant supply of electricity, keeps old coal-fired power plants running, and is considered environmentally friendly, at least on paper.
Drax, one of the UK’s largest electricity producers, was forced to shut down completely when the government phased out coal. In response, he introduced subsidies for biomass.
In 2010, the company began burning wood pellets alongside coal at its massive Selby power plant, and by 2018, its four massive boilers were running exclusively on wood pellets.
Both the EU and the UK government classify biomass as renewable because it only releases the carbon that is taken up by plants as they grow.
However, studies have shown that emissions are often as bad as those from fossil fuels, while it has been argued over and over again that environmentally sensitive forests are being turned into wood pellets.
Drax always insisted on the use of sawdust and other by-products of the woodworking industry.
Drax currently releases emissions into the atmosphere but hopes to get more carbon sequestration grants. This will permanently store emissions underground in former oil and gas wells.
For fuels like grass, this should theoretically remove carbon from the atmosphere. However, this does not apply to centuries-old trees. At some point, this technology was also to be used on a large scale.
Source: I News
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