6. New Contracts for Difference to fund climate change, air pollution and forest destruction
The Government's latest announcement on renewable energy subsidies â€“ Contracts for Difference, or CfDs â€“ contains a shock biomass handout. Most of the subsidies have gone to offshore wind; however, one award has gone to what would become Scotlandâ€™s largest biomass power station in Grangemouth, and others to controversial â€œenergy from wasteâ€ projects. The company behind the Grangemouth award is called Silva Renewable Energy Ltd. According to the Vice-Convenor of Grangemouth Community Council, the local community was not informed of the plans prior to the subsidy announcement. The company may be seeking to use a highly controversial planning consent obtained by a Joint Venture of Forth Ports and SSE, Forth Energy, in 2013, against strong opposition from the community.
Walter Inglis, Vice-Convenor of Grangemouth Community Council, said:
â€œI am shocked and disappointed to see that a company has succeeded in winning subsidies for a huge biomass power station in Grangemouth. Once again, the already poor air quality and public health of residents in Grangemouth is being sacrificed.â€
Biofuelwatch assumes that the new plant will run on imported wood chips or pellets, as the nearby Markinch biomass power station already imports â€œwasteâ€ wood from around the UK. The UK currently burns around 50% more wood in power stations than we can produce annually.
CfDs guarantee a minimum purchase price for renewable electricity which is set far above the market price for electricity. Contracts for Difference are awarded through an auction, based on eligibility criteria set by the Government. The Government decided earlier this year that biomass â€œCombined Heat and Power Plantsâ€ (CHP) would be eligible to bid in the auction. To meet the definition of CHP, a power station has to make use of a limited amount of its heat and reach an overall efficiency of just 35%, which is less than the efficiency of most fossil fuel power stations and less than half what could in theory be achieved with biomass CHP.
For more information on Biofuelwatch's response to the subsidy announcement, see http://www.biofuelwatch.org.uk/2017/environmental-campaigners-denounce-new-subsidies/. Other reports of this story have chosen to focus on the falling cost of renewables, and expecially offshore wind. For a useful round-up, see https://www.carbonbrief.org/analysis-uk-auction-offshore-wind-cheaper-than-new-gas