Government’s controversial Drax biomass subsidy faces political backlash
A government consultation exploring different funding options for Drax’s biomass-fired powerplant has received significant backlash from MPs upon publication.
The document, released today, moots options of a “constrained” contract-for-difference model and profit-sharing with consumers, that aims to secure a guaranteed price for the power produced at the plant, which ranks as the UK’s highest-polluting facility.
The other options include:
- Availability payment – where producers are paid to keep their assets available to provide energy.
- Regulated margin – a minimum profit from a proposed bioenergy with carbon capture and storage (BECCS) production is set to go towards the producer, with consumers receiving a share of any profits over that level.
The release comes on the same day the Institute of Economic Affairs published a damning report criticising the government’s efforts to allow Drax to not only classify its massive emissions as zero carbon due to the wood they burn coming from overseas but also damning today’s subsidy scheme.
The think tank estimates that the scheme could hand Drax up to £4bn through 2030.
The company has also received the greenlight on a preliminary approval decision to set up a BECCS facility, mentioned in the above subsidy plans though a spat has broken out between Drax and climate change thinktank Ember over whether the plant will save or cost UK taxpayers billions of pounds.
A Department for Energy Security and Net Zero spokesperson said of the subsidy proposal: “No decisions have been taken and the government is focussed on protecting people’s bills and any potential support would be subject to a rigorous value for money assessment – ensuring that any tax and bill payer money is spent wisely.
Various MPs have been vocal in their opposition to the plans, including Father of The House Sir Peter Bottomley who decried those who”claim biomass at-scale can be ‘renewable’ are ignorant at best, fraudulent at worst.”
Conservative MP, Pauline Latham said of the proposal: ‘’I am disappointed that the government is thinking of continuing the subsidy to Drax but they are consulting on the issue so as many people as possible should participate in this important consultation’’
Alex Sobel, Labour MP for Leeds North West added: ‘Drax has had many years of multi-billion-pound subsidy and needs to be undertaking a real transition to a renewable future not extending its life as a fossil fuel energy company’.
Biomass accounted for 7 per cent of the UK’s electricity supply in 2022 – the latest figures available – making it the second largest renewable energy source for the country.