LONDON -- As Ed Davey, U.K. Secretary of State for Energy & Climate Change, spoke to the Environment Council in Brussels, saying: “We call for urgent action on reaching an ambitious 2030 energy and climate change agreement, to spur on investment in green, reliable energy,” at home in Britain the backers of a flagship biomass energy project announced that it would be economically unfeasible to continue development. What happened?
Biomass with CHP
In contrast with dedicated power only biomass plants, biomass-fired combined heat and power installations are continuing to attract investment in the UK, given that they still qualify for significant government support.
A number of these projects have made advances over the previous few months. For instance, RWE Innogy UK (formerly RWE npower renewables), is in the final stages of commissioning its Markinch Biomass CHP plant in Fife, Scotland. This 65 MW plant will supply up to 120 tonnes of industrial steam per hour to paper manufacturer Tullis Russell. RWE Innogy is investing some £200 million (US$300 million) in the development, which was built by Metso and Jacobs.
In October 2013 Estover Energy revealed that planning consent has been granted by Dover District Council for its proposal to develop a £65 million (US$100 million) biomass-fired CHP in the South East of England at Sandwich, in Kent. Generating 11-15 MWe and 8-12 MWth, the plant will use locally sourced low-grade wood as fuel.
Construction is forecast to begin in spring 2014 at the Discovery Park science and technology park.
And in the July, the Helius Energy-developed CoRDe biomass energy plant in Rothes, Speyside, Scotland began operations, using by-products from nearby malt whisky distilleries to produce renewable energy and an animal feed protein supplement, Pot Ale Syrup. Construction began in 2011 on the 8.32 MWe and 66.5 t/h pot ale evaporator plan. The total development and construction costs of the project were £60.5 million.
Furthermore, Kedco plc, is developing the 12 MW Enfield Biomass CHP project in north London.
The Enfield Project has full Planning and Environmental Permission for the conversion of 60,000 tonnes of waste timber per annum into up to 12 MW of electricity and heat.
According to the last project update from the company, MWH Global Inc has been chosen as preferred construction contractor while Statkraft Markets is apparently cued up for the purchase of all the electricity generated by the plant.
When U.K.-based independent developer RES announced that it would be ceasing work on its £300 million (US$500 million) biomass power station project at the Port of Blyth in Northumberland it cited on-going uncertainty in U.K. energy policy, prompting the withdrawal of a key project partner in late 2013.
In a statement RES said that the government’s inconsistent support for dedicated biomass energy as well as increased uncertainty in regard to the Electricity Market Reform (EMR) process had critically undermined the investment case.
The company argues that biomass has “been increasingly marginalised by the U.K. government in a series of policy developments over the last two years, including the introduction of a cap on dedicated biomass under the Renewables Obligation (RO).” RES says the cap “represents a radical downsizing in government ambition for the technology from a target of 4,000 MW in 2011 to a cap of 400 MW in 2013, long after the industry had invested significant sums in developing projects on the back of DECC ambitions.”
“In addition, the government’s preference for the conversion of existing coal-fired power stations to biomass over dedicated biomass generating capacity is at odds with the urgent need to bridge the looming capacity crunch in the UK energy system.”
However, despite RES’ assertions, it is evident that conversion from coal to biomass is not necessarily a route to commercial success in the U.K.’s energy market. Last August RWE npower announced that was to close its Tilbury Power Station, which finally shut down in October 2013.
This 1960s-built coal-fired plant had been converted to fire biomass in 2011 as the European Commission’s Large Combustion Plant Directive (LCPD) — which mandated either a significant upgrade investment in emissions reduction or a limited number of operational hours for older coal-fired installations — began to bite. For Tilbury B, RWE determined that it would use up the remaining operating hours by switching to biomass in the hope that the move to low-carbon generation would garner support for continued operation post LCPD, potentially with another decade or so of service life.
Operation of the plant on biomass pellets — more than 90 percent of which were sourced from North America — resulted in greenhouse gas savings in excess of 70 percent over coal at the 870-MW plant.
However, the government reportedly declined its bid for inclusion in the Contract for Difference (CFD) pricing mechanism that will support renewable generation following introduction of the EMR measures. As a result, given the investment required to modify and refurbish the plant to bring its thermal efficiency up to the required 37 percent minimum standard for new biomass-fired plant, RWE said the plant was “no longer economically viable.”
Another factor possibly contributing to the decision was a February 2012 fire in the biomass fuel storage area that saw the station offline for four months.
Of course, there are those who argue that allowing wheezing and ancient coal-fired plants to eke out a few more years of life on biomass is the wrong approach. Certainly, a modern, dedicated biomass installation operates at a far greater thermal efficiency. It is therefore capable of delivering a far better energy-to-carbon emission ratio for the millions of tonnes of biomass that plants such as Tilbury B would consume.
Back in March 2013, Mark Whettall, managing director of U.K. district heating pipe manufacturer CPV Ltd, called for an end to the way in which the Renewables Obligation is incentivising electricity producers to use biomass fuels in inefficient, conventional power stations.
Whettall: “I of course acknowledge that using biomass is much better than simply burning fossil fuels such as coal, but to do it at such a low level of efficiency — and furthermore provide financial incentives for doing so — really has to be brought into question.”
Given that, from an energetic perspective, new build biomass is a far more attractive prospect than conversion, why is North Blyth a bust?
The warning signs have been gathering for some time. Back in October 2012 U.K. utility group Centrica announced that it was withdrawing plans for two biomass power stations, at Roosecote in Barrow-in-Furness and at Glanford Brigg in North Lincolnshire, with a combined capacity of 217 MW.
However, even back then Centrica noted “recent clarification on the regulatory framework relating to dedicated biomass plants indicates a preference for co-firing and coal conversion to biomass.”
Estover Energy plans to develop a £65 million (US$100 million) biomass-fired CHP plant in the South East of England at Sandwich, in Kent. Generating 11-15 MWe and 8-12 MWth, the plant will use locally sourced low-grade wood as fuel.
The U.K. Renewable Energy Association’s Back Biomass campaign is emphatic though, saying “the introduction of a cap on dedicated biomass under the Renewables Obligation and the lack of support (unless with CHP [see box to right]) under EMR has made this outcome inevitable. This represents a sizeable change in DECC’s ambitions for the sector since 2011.”
REA Chief Executive, Dr Nina Skorupska, expanded on the issue: “The government used to have a clear policy of supporting the most affordable low carbon technologies, which saw biomass projects attract healthy investment.
“However, recent government actions have eroded investor confidence in the biomass sector. The result is project cancellations totalling hundreds of MWs and millions of pounds of inward investment. This row-back on biomass leaves a huge hole in the government’s plans to keep the lights on with low carbon technology."