Tag: biomass energy

Forests, sustainability and biomass – the expert’s view

Matthew Rivers, Director of Corporate Affairs, Drax, Group Special Advisor

6 October 2016

Opinion

It was a forestry catastrophe that first inspired Matthew Rivers’ interest in forests.

Dutch Elm trees, an iconic part of the UK landscape for over 250 years were becoming infected with a fatal and fast-spreading disease. The race was on to save them.

A schoolboy in North London at the time, Rivers joined the after curricular school team tasked with saving its trees – first by injecting them with insecticide, and when that didn’t work, by felling and replanting them. It was an early foundation in how forests work and the challenges of keeping them healthy.

Decades later, Rivers is Director of Corporate Affairs at Drax. It’s a role he finds himself in following a career as a forester, helping to manage forestry businesses, and supporting the setting up of wood product manufacturing plants.

His own estimation of his working life is a humble one, however. “I think I’m probably a failed farmer,” he says.

“A forester always plants in hope.”

Rivers studied forestry at university in Scotland before taking up jobs in the forestry industry across the UK, Uruguay and Finland. Working in this industry, he says, is one that requires patience.

“In the UK we’re talking about 30- or 40-year growth cycles. The trees I planted at the start of my career are only just coming to maturity now,” he explains.

But more than the long investment of time, being a forester relies on faith. “A forester always plants in hope,” he says. When a forester plants a tree, he or she most commonly does not know who the end customer will be.

So when the call came from Drax for a forestry expert to help guide the company through an important transformation – upgrading the power station from coal to biomass – the challenge was one he was ready to take.

“Drax already had ambitions of converting three boilers to run on biomass. That would mean consuming tonnes of compressed wood pellets,” he says. The business needed a supply, and Rivers was drafted in to set this up.

As part of the supply solution, and Chaired by Rivers, Drax set up Drax Biomass, a pellet manufacturing business in the USA that makes and supplies compressed wood pellets to Drax Power Station.

Setting up its own manufacturing plant not only means Drax needs to rely on fewer external suppliers, but also that it can use the learnings about the technologies, the economics and the sourcing of the process to continually hone its supply chain.

To operate responsibly and receive governmental support, Drax has to be sustainable, and this is particularly important when it comes to where and how it sources its fuel. This comes with its own challenges.

No universal definition of sustainability

“To my understanding, there is no universal definition of sustainability,” says Rivers. So how do you proof your business for an unclear entity?

“At its heart, sustainability is about not doing anything today that would prejudice doing the same thing for the next generation or generations to come.”

A responsibly managed forest is one that is as healthy, productive, diverse and useful in 100 or 500 years’ time as it is today. They key to this, is to think of forests as a whole.

Rivers explains: “Think about a single tree – you fell it and use it to heat your home over one winter. But it’s going to take perhaps 30 years for that tree to grow back,” he says. “What do you do for the next 30 years?”

“In a sustainably managed forest you have all different ages of tree represented – one thirtieth devoted to each age- and, when you use an older tree to warm you in winter, you plant a replacement. That way, for every year you’ll have trees reaching maturity ready to provide your power.” It’s a cycle that, if managed responsibly, keeps delivering a useful resource as well as maintaining the health of the forest.

Rivers continues: “Sustainability is the very nature of what a forester does; because if we don’t take care of our forests, and ensure we have a crop to harvest year after year, we lose our livelihood.”

forests_trees_growing_for_winter_heating_smh4nj

Becoming a private forester

Two decades ago, Rivers completed a loop he started decades ago amidst the Dutch Elm crisis and became a forest owner himself. In Scotland, he bought, and now manages, his own private forest.

“We’ve had kids’ birthday parties, we’ve dug out a pond, we harvest chanterelles in the autumn – there’s a millennium capsule buried somewhere,” he says.

It’s not only a family heirloom. It’s a place for him to exercise a passion – maintaining and managing a responsible and healthy forest.

 

A solution for cheaper, cleaner power

Sustainable bioenergy
Senior couple checking their bills

Britain has some big energy targets ahead of it – namely an 80% reduction in carbon emissions by 2050 compared to 1990 figures. A renewable energy future is not an optimistic target, it is a necessary one.

But for this picture to also be a practical one it needs to be affordable. A study from NERA and Imperial College London, commissioned by Drax, suggests there are ways for renewable technology to be cheaper than it currently is.

In fact, in one scenario they looked at, there could be savings to the tune of £2.2 billion.

Incentivising decarbonisation

It’s a positive and necessary support mechanism. However, some renewable technologies, like compressed wood pellets, a form of biomass, are excluded from participating in upcoming the auctions scheduled between 2017-20. Why is this?

Missing the bigger picture

Currently, CfD support is based on how much a particular type of electricity costs combined with how much it takes to build and maintain the facility used to generate it. This figure is what’s called the ‘levelised cost of energy’ (LCOE). The spanner in the works comes in that not all costs are considered in making this judgement.

Powering a country requires more than just a power source. We need ancillary services like backup power to get the country back on the rails in the event of large-scale blackouts, and voltage control to ensure electronic devices continue to work and that power can move around the network. The costs associated with these services – system integration costs (SICs) – are excluded from the CfD equation.

Sources like wind and solar, being intermittent, can’t offer most of these on-demand ancillary services but we still need them to play a part in the UK’s energy supply. Biomass facilities can provide a number of these itself, meaning it actually has a negative SIC cost.

However, in the current pricing system – ignoring these associated costs – biomass is considered more expensive than onshore wind and solar. With the high SIC costs for wind and solar included, biomass is in fact the cheapest option.

Finding the right mix

This is not to say that solar and wind are not an integral part of a more renewable future. A truly flexible low carbon, high voltage electricity grid should be a mix of elements. Current rules do not look at the full picture, and are ruling out important alternatives, but there are possible solutions. One could be unifying the markets.

There are four markets that feed into the UK’s electricity supply and there’s little transparency or cohesion between them. This leads to inefficiencies.

Jens Price Wolf, Regulations and Market Director at Drax, explains: “Solar is the cheapest renewable, diesel is the cheapest option in the capacity market and gas will be the cheapest for energy production.”

By considering each market as separate you end up buying the cheapest solution for that individual purpose rather than considering its performance across all. This misses out solutions that can benefit the whole system.

“Biomass might be the second cheapest option in each field,” says Wolf. “So supporting investment to upgrade existing coal power stations with biomass technology satisfies multiple needs and leads to it being ultimately cheaper than the old mix.”

A single market approach that treats all technologies and generation methods in the same way could lead to significant cost savings, and those savings could be passed on to bill payers in households and businesses.

While this could be a longer-term solution, there are ways short-term actions that can make a difference. If the government were to include biomass in the mix for the next round of CfD auctions it could bring about savings of over £2 billion over the next 15 years, or a £85 saving per household over the same period. And, it would do this while ensuring the grid remains adaptable without sacrificing emissions targets.

The 4 most common myths about renewables

Power generation

Renewables make up more of the world’s energy mix than ever before. And yet, misconceptions about these new or alternative technologies – such as biomass, solar and wind – are common.

Some of these concerns are – for the time being – partly justified, some completely subjective, and some are demonstrably wrong. Here’s a closer look at the most pervasive myths and what truth there is behind them.

Renewables are unpredictable

An oft-repeated misconception is that renewables aren’t a full-time solution to our power needs. It’s true that solar isn’t generated at night and wind turbines don’t operate in still weather, but the canon of renewables is bigger than its two most well-known technologies.

Tidal power still depends on environmental factors, but tides are much more predictable than wind or sunlight. For countries lucky enough to have ready access, geothermal power – which uses heat from the earth’s core to power generators – is even more reliable.

Biomass solutions, such as compressed wood pellets, are a fuel-based power source, meaning they are flexible so can be used to generate electricity on demand and operate as a base-load power option, much like coal or gas. At Drax Power Station renewable electricity is generated on demand using compressed wood pellets and delivered to the National Grid 24-hours-a-day.

Now, thanks to advances in weather forecasting, the National Grid can plan ahead to balance the system with other renewable and low carbon technologies when the sun isn’t shining and the wind isn’t blowing. Just a few years ago the primary fall back was relying on coal power stations to pick up any slack.

It might not be possible to power the world entirely with one renewable source, but the right mix of technologies could provide an answer to the question of how to ensure a stable and secure low carbon energy supply.

Heavenly Scene Stormy Skies

Renewables are expensive

There is some truth in this, but it’s important to note that these costs are falling. Many of the high costs associated with renewables have been down to a lack of infrastructure investment.

A number of the components required in construction of structures like wind turbines and solar panels are expensive. And, as many renewable facilities need to be located in different areas to existing traditional facilities, extensive power grid extension is often needed. But these are problems that once set up, should bring down the costs of renewables such as solar and wind.

Setting up biomass-powered facilities is considerably cheaper. Compressed wood pellets can be used in upgraded coal power stations, so there’s no need for expensive new connections to the high-voltage electricity transmission system.

There are even ways renewables could bring about cheaper power for consumers. Research commissioned by Drax and published by NERA Economic Consulting and Imperial College London found that, if the same government support offered to some renewable technologies (i.e. wind and solar) were open to all (such as biomass), consumers could see potential savings of £2 billion on their energy bills.

Renewables are ugly

While this isn’t necessarily an opinion shared by everyone, it is one that is often cited. Onshore wind farms often draw the most ire, but they aren’t alone. Large investments are being made in offshore wind farms, which are both more discrete and better positioned to take advantage of stronger offshore currents.

And hydropower projects like dams and tidal barrages can in the long term create whole new habitats, ecosystems and leisure facilities in the form of artificial lakes and surrounding forests.

Nobody uses renewables

In 2015, 99% of Costa Rica’s electricity came from renewable sources, including hydro, geothermal, wind, biomass and solar. Closer to home, Sweden draws more than 50% of its electricity from renewable sources, including 22% from bioenergy – 90% of which comes from forestry.

In the UK, renewables use is steady and rising, accounting for 25% of all electricity generated domestically in 2015. In the first half of 2016, 20% of the UK’s renewable power was supplied by Drax. Contrast those figures against coal, which in the UK declined from supplying 30.8% of UK power needs in Q1 2015 to just 15.8% in Q1 2016, and our increasing use of renewables is even more evident.

Consumers have been buying 100% renewable electricity tariffs from companies such as Good Energy for more than a decade. Businesses are increasingly getting in on the act too. Two thirds of the power generated by Drax in the first half of 2016 was sold directly to companies via Drax Group’s business electricity supplier, Haven Power.

And with campaigns such as RE100 challenging the world’s biggest firms to commit to renewable-only power, household brands such as Ikea, M&S and Google are either already 100% renewable or only a few years away.

Misconceptions about renewables will remain as long as we’re still in the transition out of fossil fuel use. But the industry has made huge strides from where it was just 10 years ago.

Thanks to better, more affordable technology, an increasingly friendly corporate sector, and a greater awareness of environmental issues at large, these products and services will continue to improve, grow and increasingly becoming more mainstream.

Inside the dome

Sustainable bioenergy

There are four storage domes at Drax Power Station and each of them can hold 80,000 tonnes of compressed wood pellets. It’s these biomass pellets, a sustainable fuel, that Drax is being upgraded to run on and produce renewable electricity.

Wood pellets are an incredible fuel that can match coal for efficiency – the challenge is you just need more of them as the density and calorific value of coal is greater. However, storing such large quantities in a confined space presents risks that have to be managed, 24/7.

Atmospheric control

The crucial difficulty with storing the pellets is their chemical volatility. Wood, which the pellets are made from, emit carbon monoxide (CO). In a confined space such as the storage dome, this CO can build up and – due to CO’s extreme flammability – require the entire internal atmosphere to be regulated by a set of highly sophisticated engineering solutions.

As long as materials are emitting more heat into the atmosphere than they are storing in themselves, there is no risk of combustion. A single wood pellet in a fuel store poses no fire risk. Nor does a small pile. But when thousands upon thousands are piled together, the pressure builds up and causes the pellets to heat up.

Gradually, the rate of temperature increase speeds up, and before you know the flashpoint threshold has been crossed and there’s potential for danger.

However, remove or limit the oxygen supply in the silo and purge the CO that’s emitted from the pellets, and the risk of a thermal event is substantially reduced. The challenge for the engineers at Drax constructing the domes was finding a way to manage temperatures within the dome.

Neutral nitrogen

To do this they created a system to automatically inject nitrogen into the storage dome. While nitrogen isn’t a truly inert gas, it is much less reactive than CO and oxygen.  With this pumped into the dome’s atmosphere it is a much safer environment.

To get a steady supply of nitrogen, regular air from our atmosphere – which is 78% nitrogen – is passed through a molecular filter, which removes the larger oxygen molecules. The gas collected at the other end is 96% nitrogen.

This nitrogen-rich air is then injected from underneath the dome and continually distributed around it. Not only is this a fire prevention method, but also a firefighting one that can be pumped in larger quantities in the event of combustion. Separate to the above measures which are there to manage fuel temperatures, the dome is also fitted with a carbon dioxide (CO2) injection system and water deluge system which are there as fire extinguishing precautions.

The big ear inside the dome

The next problem facing the designers was how to accurately monitor the quantity of compressed wood pellets inside the dome. To achieve this, each dome is fitted with a sonar system – which sounds a bit like a chirping bird – that provides continuous feedback on how full the dome is.

The sonar monitoring system provides level, profile and volume information which is translated into a 3D image of the stored biomass. This method of volumunetric measurement allows the operators to view and monitor in ‘real time’ the effects of their actions when filling and unloading domes, so they can target specific areas particularly when unloading and for fuel accounting purposes.

Other tools and tricks

Five thermocouple arrays measure the pile temperature and provide feedback in real time to the operators to allow them to assess the status of the dome and effectively plan material filling and reclaim. Gas monitors measure the levels of CO and CO2 as well as O2 depletion within the head space of the dome.

A dome breather vent (a two way acting valve, which as its name suggests, allows the dome to breathe) is fitted to the top of the dome and acts as a vacuum breaker maintaining a relatively even pressure allowing air in during unloading and releasing head space gasses during nitrogen inserting.

The final piece of the atmospheric control puzzle is regulating pressure. At the top of each dome is a controllable aperture called a slide gate which is closed unless the dome is being filled to allow material to enter. A dome aspiration system is installed here to filter and remove displaced air from within the head space during filling, but also allow a route for CO and other offgassing products to escape.

All the hidden systems within these four huge white domes allow the operator to effectively control their atmospheric conditions and crucially to store massive amounts of potentially volatile biomass safely on site.

Find out more about these giant storage domes – read the story about how they were constructed. 

Mind the gap

Dorothy Thompson, (2005-2017 Chief Executive, Drax Group)

28 July 2016

Opinion

Later today the EDF Board is expected to give the go-ahead for a new nuclear power station at Hinkley. This will provide some long overdue clarity for Britain’s energy sector, but we now need to quickly move on and make the right decisions to secure the best mix of power generation.  The drawn out debate around Hinkley Point C has diverted attention away from the sector’s biggest challenge.

The Government has made it clear that coal must come off the system by 2025.  But coal still provides up to one fifth of the UK’s electricity, and plugging that gap will be far from easy.  Nor will doing so in a way that allows the country to meet its carbon targets while supporting the technologies that will deliver a modern energy system fit for the 21st century. The Government’s intention is absolutely right, but how does it intend to meet its target?

Let’s be clear, a positive Hinkley Point C decision will play an important role in the necessary energy mix but will provide no silver bullet. By most estimates, when finally complete, the nuclear plant will provide seven percent of the UK’s electricity needs.  However, this isn’t expected to come ‘on grid’ much before 2030, and let’s remember that in 2030 all but one of the UK’s current operating nuclear reactors are scheduled to be closed. Hinkley will therefore be replacing only some of the lost nuclear capacity, not providing ‘new’ energy to replace coal.

The last few years have seen a huge and welcome expansion in renewable sources of generation like wind and solar in the UK, but they are intermittent and cannot fill the gap alone. They still need to be supported by a constant supply of electricity that can be flexed up and down when the wind does not blow and the sun does not shine – a regular scenario on these shores.

As a form of low-carbon baseload generation, nuclear will undoubtedly be part of the answer. However, as we’ve already seen with Hinkley Point C, planning, funding and building new power stations can be a long and costly process. It has taken over a decade to reach today’s decision. In the past year alone, more than 5 gigawatts (GW) of coal power generation– Hinkley Point C is set to provide 3.2 GW – has come off grid well before the Government’s target of 2025. We don’t have the luxury of time: every day lost adds to the cost of addressing this challenge.

Gas will play a role but many, including the Institution of Mechanical Engineers (IMechE) have pointed out the huge number of gas-fired power stations we’ll need to plug the gap that ending coal creates. IMechE estimates 30 will be required which is clearly unrealistic, since the UK has built just four in the last 10 years.

At Drax, we have developed a solution to these challenges. We have used state of the art technology to upgrade some of our coal facilities to generate electricity from biomass in place of coal.  These facilities are already providing a reliable and flexible flow of electricity that also helps the UK meet its carbon targets.  The biomass we use is compressed wood pellets which perform in much the same way as coal and deliver an 80% CO2 saving.

Our biomass facilities are already powering three million homes and with the right support we can double this, helping to plug the energy gap that old plant coming off and delays to new build will leave us with.

Using biomass is more cost-effective than other renewables. This was illustrated by a recent study from Imperial College and economic consultancy NERA when they analysed the hidden costs of the back-up needed to meet demand created by intermittent renewables. Our biomass facilities can provide all of the electricity services required to keep the UK electricity system stable. Providing these services is set to become increasingly important in the years ahead as a greater need to back-up and balance the system will be required.

Finding the right mix of power generation will not be easy, but it is important we make every effort to get it right. Like Hinkley Point C, biomass is not a silver bullet, but it can and must play its part in helping the country transform to a low-carbon future.

Sustainable Biomass Program – proving biomass is sustainable

Dorothy Thompson, (2005-2017 Chief Executive, Drax Group)

14 April 2016

Opinion

I was honoured to be able to accept the Excellence in Bioenergy award recently. Not for myself, but on behalf of all my colleagues at Drax who have worked so hard to make a reality of our shared plan to generate reliable, renewable electricity. Our achievements are truly a team effort.

In 2015, Drax became a predominantly biomass-fuelled power station.

We now generate more electricity at Drax power station from compressed low-grade wood pellets than from coal – between three and four per cent of the UK’s entire demand every day.

It’s a major triumph for all the brilliant engineers involved in converting the plant and everyone who has helped secure the incredibly complex supply chain that keeps it running.

But we truly believe that this is only the beginning for sustainable biomass.

Sustainable biomass is the ideal fuel to help the world decarbonise in an affordable and reliable way. It can support other renewables like wind and solar when the elements are against them and backup power is needed.

Because it can be created by upgrading existing coal-fired power stations, it can be added to the electricity grid in a fraction of the time and for a fraction of the cost of building new power stations. Why should the UK only build brand-new gas and nuclear power stations when existing coal power stations can be upgraded to low carbon, renewable tech? At Drax, we have shown how engineers working at what once was the biggest coal power station in western Europe can use their expertise to work with compressed wood pellet power generation.

And it can save bill payers billions of pounds when the true costs of bringing other renewables on stream are taken into account.

The industry’s greatest challenge right now is in proving that all the biomass we use is truly sustainable.

At Drax we have proven the sustainability of the biomass we use time and time again. But we can and will do more to ensure that standards right across the industry are always equally high.

We cannot underestimate the importance of sustainability. No corners can be cut. We must all join together and meet this challenge. Because without sustainable biomass there will be no industry at all. Without sustainable biomass in a balanced energy system with other renewables and low carbon technologies, the Paris climate change summit commitments may not be reached.

This is why the Sustainable Biomass Program is so important. The SBP has developed a certification framework  to provide assurance that woody biomass is sourced from legal and sustainable sources.

By working with the SBP, all of us in the industry alongside hard working families and businesses stand to benefit. Which is why all of us at Drax welcome its inception, and look forward to working with the SBP to help build a growing and healthy industry that helps our society transition to the renewable fuels of the future.

May 2017 update: the SBP has changed its name to the Sustainable Biomass Program — you can read its first annual report here.

North Yorkshire tops chart for renewable energy

Andy Koss, CEO Generation until April 2020

8 April 2016

Opinion

A new survey from the Green Alliance and Regen SW shows that Selby in North Yorkshire produces the most renewable energy of any area in England and Wales. As you can see, Drax’s home tops the chart by a large margin.

That’s because between three and four per cent of the UK’s electricity is generated from sustainable biomass here at Drax power station.

We’ve already converted half the station to use compressed wood pellets. That half of Drax has reduced its carbon emissions by more than 80 per cent as a result.

But there’s so much more Drax could do to help the UK get more coal off the grid. And if the Green Alliance’s next data visualization pitted renewables against fossil fuels, a renewable-only Drax as our country’s biggest power station would give low carbon technologies an even bigger share than would be the case today.

Drax can not only generate more renewable power ourselves, but also help solar and wind power to cope with demand as some of the older coal, gas and nuclear plant retire over the coming years.

Moving towards a balanced mix of renewables including further biomass upgrades at Drax could save bill payers billions of pounds found research carried out by NERA and Imperial College London.

This was commissioned by Drax to establish the ‘true’ cost of the main forms of renewable energy – wind, solar and biomass.

The UK is already far below the European average when it comes to using wood for energy.

If the government made the right decision and levelled the playing field for biomass in the UK, Drax could help our country climb the table, meet our national climate change targets more quickly and contribute to saving bill payers billions of pounds. Upgrading from coal to wood pellets is also ensuring Drax Group – which employs more than 1,400 people – has a real future at the heart of the Northern Powerhouse.

However it’s not just for government to change the status quo – businesses have a role to play too. Many UK businesses have made firm commitments to limit and reduce their impact on the environment. For all, their use of energy is a critical area to consider and address. Some of the biggest electricity users such as Thames Water and Manchester Airport Group are increasingly demanding renewable electricity. Drax Group’s Haven Power is proud to offer the only 100% guaranteed renewable electricity product in the market to businesses big and small.

Perhaps that’s what the Green Alliance’s next index could investigate – which businesses have taken practical steps towards a renewable future.

Renewables: better together

Andy Koss, CEO Generation until April 2020

5 April 2016

Opinion

There’s more pressure than ever to reduce carbon dioxide emissions from electricity generation. And no one is keener than the team here at Drax Power Station to make it happen. In fact, we’ve been doing it for a decade. But we need the right support to finish the job.

  • We upgraded our turbines between 2007-12 to save one million tonnes of CO2 emissions.
  • We’ve converted half our station to run on compressed wood pellets instead of coal – reducing emissions by up to 86 per cent.
  • Our friends in the North of England have invested millions of pounds to help us make that happen, through building new infrastructure at our landing and loading facilities at the Port of Tyne, the new port at Liverpool, at Hull and at Immingham.
  • We’ve designed and commissioned our own rolling stock with Lloyds Register Rail to ensure that the compressed wood pellets can be transported to the power station in the most energy-efficient way possible.

And while many jobs in the North of England are being lost with the planned closure of a number of older coal-fired power stations, we continue to employ over a thousand people directly here in North Yorkshire.

In fact, it’s no exaggeration to say that Drax is a genuine Northern Powerhouse, to borrow a phrase from the Chancellor of the Exchequer.

Which is why we hope he and his colleagues in Government will listen when we say that we’re seriously concerned that the planned auctions for new green energy could result in bill payers missing out on savings of over £2 billion.

The Government has committed to three further renewable energy auctions that will happen over the next few years. The first of them is already planned for later in 2016.

As far as we know, those auctions will only be open to offshore wind and perhaps also something being referred to as ‘less established technologies’.

But independent research published by NERA and Imperial College London suggests that a ‘single technology’ approach could waste a significant amount of money.

The research was commissioned by Drax to establish the ‘true’ cost of the main renewable energy technologies – wind, solar and biomass.

As a result, economists conclude that hard working families and businesses could enjoy significant savings if these auctions were opened up to include other renewables.

But the sun doesn’t always shine and the wind doesn’t always blow. This makes wind and solar intermittent energy technologies. Backup power is needed when the weather’s not right or when demand is high.

Naturally, this standby energy isn’t free. Someone has to pay for it.

But those additional costs are not currently included in the way that the Government calculates how much support the different kinds of renewable energy require.

And the ICL/NERA research shows that when the true costs are added in, offshore wind is actually the most expensive form of renewable energy.

The affordable solution is to convert existing power stations to use compressed wood pellets in place of coal. This balanced approach also allows more offshore wind and solar onto our electricity network without the need for more fossil fuels to provide overall reliability. More biomass conversions can also help the UK end coal by Energy Secretary Amber Rudd’s 2025 target date.

That’s what we mean when we say Drax needs the right support to finish the job. We’re asking the Government to consider the true cost of bringing new renewable capacity on stream. And then to add sustainable biomass to the auctions for new contracts.

That decision could save bill payers up to £2bn. It could safeguard thousands of direct and indirect jobs in Yorkshire and the North of England. And it will give our country the reliable, renewable power we need when others just can’t deliver it.

The true cost of replacing coal-fired electricity generation

Dorothy Thompson, (2005-2017 Chief Executive, Drax Group)

17 February 2016

Opinion

To make up for these closures, the Government is already planning to bring on new capacity. A new gas-fired power station will open at Carrington this summer, and we’re expecting to hear any day now that another nuclear power station will be created at Hinkley Point. And of course more electricity from renewables must be added over the years ahead as we look to meet our ‘go green’ targets.

In fact, the Government already has a plan in place to award contracts for new green energy off the back of three auctions over the next four years. The first of them is due later this year.

Drax understands that every one of those auctions is focused on offshore wind.

However, new independent research published by NERA Economic Consulting and Imperial College London questions that ‘single technology’ approach. 

Commissioned by Drax Group plc from leading economists, the research reveals the ‘true’ cost of the main forms of renewable energy – wind, solar and biomass.

And the evidence shows that opening up these auctions to include other renewables could result in significant savings that could be passed on to consumers. 

Where could these savings come from?

Renewables like wind and solar are vital, but they are by their very nature intermittent. That means other forms of power generation need to be available on standby at very short notice to meet the gap between supply and demand.

The costs of providing this standby electricity are passed on to consumers in their energy bills.

But crucially, they are not reflected in how the Government ranks the support that each type of renewable energy requires. Essentially the costs are hidden.

The NERA/ICL research shows that if these ‘hidden costs’ are added in, the true picture is very different.

When the true costs are taken into account, the Government’s preferred option – offshore wind – turns out to be the most expensive. In fact, the cheapest option is deploying new technology to existing power stations, enabling them to use biomass – essentially replacing coal with compressed wood pellets.

All in all, getting cheaper renewables into the mix could save consumers up to £2.2bn. How? Support for renewables is already funded through a portion of your energy bill, and bringing in a more cost-effective mix reduces the support needed.

That is why we at Drax are urging the Government to look at the true costs of new renewable capacity and include us in the mix for new power contracts.

To do so would not only lead to a potential £2bn saving for consumers, but replacing more coal with biomass gives the UK that reliable standby power we know we will need when other renewables can’t deliver it.

Using the latest technology we’ve already upgraded half of our Power Station to run on compressed wood pellets. The job’s not done. With the right support we want to carry on with the work we’re doing and help the Government to achieve its target of getting coal off the system by 2025.