Changes to Drax support have been announced with the government halving subsidies and insisting that the company uses 100% sustainable wood.
Reduced subsidies were announced for the wood-burning power plant Drax this week, with the government claiming the new deal will halve consumer costs and improve sustainability. It also ordered it to use 100% sustainable wood after continuing criticism of its business model.
The North Yorkshire-based power station near Selby produces around 5 % of Britain’s electricity, and was due to see its subsidies expire in 2027.
In a written statement on 10 February, Energy Minister Michael Shanks said Drax would switch from being a baseload electricity generator, running about two-thirds of the time, to only operating as “dispatchable power.” This means it will only operate when needed, giving precedent to solar and wind when available. It is estimated that this will save consumers £170m a year.
Although Drax will continue until at least 2031, the government acknowledged that it cannot be allowed to operate the way it has until now, or with the level of subsidy it received in the past, which enabled the energy producer to make “unacceptably large profits.”
Chris Packham, the wildlife campaigner, criticised the decision as “nothing short of absolute madness”.
Greenpeace UK policy director Dr Doug Parr said continuing to subsidise biomass imports is “a dirty compromise with past failures.”
“Trees should be left to grow and not be burnt in a major subsidy-fuelled bonfire,” he said, warning that commitment to Drax could become more of a “stranded” asset as the energy market develops. The new criteria should, hopefully, limit the damage done both by restricting its operations and reforming its supply chain, but the government is still far too trusting of big polluters asking for big subsidies to decarbonise.
Will Gardner, Drax chief executive said: “Drax can step in to increase generation when there is not enough electricity, helping to avoid the need to burn more gas or import power from Europe, and when there is too much electricity on the UK grid, Drax can turn down and help to balance the system. The size, flexibility and location of the power station makes it important for UK energy security and the proposed agreement helps protect the jobs and skills of today and the future.”
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