Scarcity of biomass in U.K. could be a problem for plan to replace oil, coal and gas with biomass for power generation, as reliance on imports would be risky, might challenge plan's low-carbon credentials

Audrey Dixon

LOS ANGELES , May 29, 2012 (Industry Intelligence) –

The U.K.'s  low availability of domestically sourced biomass could be problematic for plan to use it to replace oil, coal and gas for power generation, according to experts, reported Reuters on May 25.

The long-term buying of biomass from overseas suppliers would leave the U.K.’s energy supply open to possible disruptions, say analysts. Furthermore, having biomass shipped from as far away as Canada or Australia calls into question how how environmentally friendly biomass really is as an alternative fuel, Reuters reported.

The supply of biomass does appear to be improving as demand grows from utilities and independent producers, but “non-utility takers” can still expect uncertainty when sourcing a “viable, long-term, bankable wood fiber supply,” said James Barrett-Miles, renewable energy corporate finance director at Ernst & Young Inc., reported Reuters.

Britain’s biomass consumption is projected to increase tenfold over the coming 25 years as it aims to reach a 2020 goal of obtaining 15% of its energy from green sources. Three gigawatts of green generation, representing 20% of Europe’s growth through 2035, is now in the planning stages, Reuters noted, citing IHR Emerging Energy Research. However, banks are likely to closely scrutinize proposed biomass projects.

Britain is bolstering its biomass expansion by paying about €84 (US$105) for each megawatt hour of output from dedicated biomass plants through so-called Renewable Obligation Certificates (ROCs), and it plans to keep this level the same from 2013, according to Reuters, and investors are closely watching the government’s next moves on renewable energy financial assistance.

Converting coal plants to biomass is a quick and inexpensive way to cut carbon emissions. Some major utilities also have started burning biomass alongside coal. A key uncertainty, however, is how the European Union’s clean air legislation will affect such plants, Reuters reported.

The primary source of this article is Reuters, London, England, on May 25, 2012.
 

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