Britain’s government is unable to demonstrate whether biomass power plants that have received £22 billion of public subsidies are complying with sustainability rules which see them classed as carbon neutral.
A National Audit Office (NAO) report on Wednesday found the government “cannot demonstrate” that biomass firms are meeting climate regulations.
“If biomass is going to play a key role in the transition to net zero, the government needs to be confident that the industry is meeting high sustainability standards,” NAO head Gareth Davies said.
“However, government has been unable to demonstrate its current assurances are adequate to provide confidence in this regard.”
Biomass, or wood-burning, power generation has been a topic of controversy in the UK, with questions being asked over the source of the wood pellets used in power stations and the environmental impact of burning them.
Burning wood releases as much or sometimes more CO2 into the atmosphere than coal, contributing to air quality issues and also leading to deforestation if not sourced sustainably.
Supporters argue that as the wood is recently grown rather than from millions of years ago like fossil fuels, the impact on the environment is carbon-neutral, as trees absorb CO2 during growth. The carbon-neutrality claim is debated due to the time-lag in CO2 reabsorption by new growth.
A BBC Panorama investigation found last year that biomass production affected ancient rainforests in Canada, while North Yorkshire-based Drax Group's (LSE:DRX) power station, the largest biomass site in the UK, was found to be the UK’s single largest source of carbon dioxide emissions in 2020.
Davies added that the government “must review the assurance arrangements” for biomass schemes, with ministers said to be mulling further multi-billion pound subsidies to support power generation at Drax’s plant beyond 2027.
This comes after the government gave the green light for carbon capture technology to be fitted to two of the four biomass-burning generators at the site earlier in January, with emissions from these then set to be stored in depleted oil fields beneath the North Sea.
A government spokesperson hailed that the report did not find evidence of firms not complying with sustainability rules.
Drax responded that it backed a review of the UK’s biomass sustainability rules.
“We are committed to ensuring the biomass we source delivers positive outcomes for the climate,” they commented.
“NAO recommendations are a means to actually moving forward with the biomass strategy of the government and are looking to ensure a future for biomass in the UK,” RBC analysts added, with shares in Drax climbing 3% following the report.