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Power & Utilities

Drax subsidies under scrutiny as government urged to ditch biomass power support

Environmental groups have ramped up pressure on the government to end support for biomass power generation as a decision on new subsidies for Drax Group (LSE:DRX) looms.

Extending such subsidies “would be disastrous for nature, the climate, energy security and costs,” an open letter, signed by the likes of Greenpeace, WWF, Friends of the Earth and the RSPB, said on Tuesday.

Ministers are yet to decide on whether to grant Drax subsidies to support biomass power generation at its plant in North Yorkshire, which runs on wooden pellets, from 2027.

Drax has been paid £7 billion through these clean-energy subsidies since 2012, according to think tank Ember, given biomass is classed as carbon-neutral.

However, groups argued further support would undermine government pledges to cut bills and increase the UK’s energy independence in the letter to Energy Security Secretary Ed Miliband, Foreign Secretary David Lammy and Environment Secretary Steve Reed.

Biomass “is one of the most expensive energy technologies in the world,” the letter said.

It also increases “dependence on fuel imports,” with the majority of Drax’s fuel coming from North America.

The climate groups called for a meeting with Miliband to discuss biomass once again, following a request in a letter last month.

“Drax Power Station in Yorkshire is the UK's single biggest carbon emitter and is being propped up by huge amounts of public money,” Friends of the Earth chief executive Jamie Peters added.

“It can’t be right that the thousands of people facing another winter of unaffordable energy bills are helping to subsidise this inefficient and harmful polluter that relies on cutting down the US and Canada's forests and greenwashing its activities.”

Drax was approached for comment.

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