* New biomass plants to get subsidy only if they harness
* Subsidy for new plants to apply only up to 400 MW capacity
* State funding for all biomass plants to be phased out by
By John McGarrity
LONDON, July 18 New standalone biomass power
plants in Britain will not be eligible for some subsidies unless
they generate heat at the same time, under new government
proposals, meaning many new plants could be cancelled, an
industry lobby said.
Britain's government said on Wednesday it aimed to deny
public money via guaranteed minimum power prices to dedicated
biomass plants that do not generate both heat and electricity.
"The lack of a strike price for new build biomass means
support for this important technology has effectively come to an
end, and we urge the Government to reconsider," said Gaynor
Hartnell, chief executive with the Renewable Energy Association
She said that as heat output, known as combined heat and
power (CHP) could not easily be built into projects that had
already been approved, many would be scrapped:
"Developers cannot simply add CHP to these projects
retrospectively, so they will most likely be cancelled."
CHP is seen as much more efficient as the heat from power
generation is used to warm homes and businesses.
The government is steering a landmark energy bill through
parliament that aims to unlock 110 billion pounds ($168 billion)
of new energy investment to replace ageing capacity and lower
Policymakers also plan to restrict subsidies for biomass to
400 megawatts per plant through a different type of subsidy
called the Renewables Obligation, as also outlined on Wednesday.
Restrictions on this form of subsidy will only apply to new
projects and not conversions from coal-fired power planned by
companies such as Drax, Britain's biggest power station.
"It is new, so-called dedicated biomass power stations that
will have a cap on subsidies, and not those plants that are
switching to wood from coal," a spokeswoman for Drax said.
This means that large scale, controversial imports of wood
pellets to Britain will continue.
On Wednesday, Edward Davey, Britain's Secretary of State for
Energy and Climate Change, told BBC Radio that importing wood
and burning it as biomass was not the long-term answer to the
country's energy needs, leading to suggestions that the
government was reversing its previously policy of support.
Drax and other large generators switching to biomass from
coal will have subsidies phased out by 2027, meaning they will
then have to pay all the costs of burning wood instead of the
highly-polluting fossil fuel.
"This is something we already knew and does not mark a
change in government policy," the Drax spokeswoman added.
Britain's energy ministry said in a statement that it had
always been clear that biomass is a transitional technology, "to
be replaced by other, lower carbon forms of renewable energy in
the medium to long term".
Drax has already converted 660-megawatts of output to
biomass, and plans to switch two similar sized units to wood
pellets by 2017.
Green groups are concerned that growth in Britain's
bioenergy industry will mean the felling of virgin forests for
fuel, a practice that was commonplace in Europe and North
America before coal was used to power the industrial revolution.
They say that carbon footprint of harvesting trees and
shipping wood pellets across the Atlantic is much higher than
power companies estimate.
Drax said the fuel it imports has cut emissions in converted
units by 80 percent compared with burning seaborne coal, and
that the wood used, much of which is sourced in the southern
United States, is certified as sustainable.
But not all plants that have switched to biomass have
decided to maintain power generation.
Last week, RWE npower said it would close a newly converted
750-megawatt biomass plant at Tilbury by July 21 because of a
forecast drop in UK power prices and lack of capital from the
Germany-based parent RWE.
Last year Drax scrapped plans to build a new dedicated
biomass plant on its site in North Yorkshire, citing the need
for better government support.