Summary
¦ The Renewables Obligation policy underpins biomass subsidies.
¦ The subsidy is often used to support the purchase of woodfuel.
¦ John Clegg Consulting’s study said demand for some wood exceeds supply.
¦ The revised Waste Framework Directive introduces the waste hierarchy into legislation.
The wood panel industries’ argument has never been against the burning of wood per SE, but rather we have been lobbying against the subsidy regime which is under-pinned by the Renewables Obligation (RO) policy.
The RO is a blunt instrument that works well for the likes of wind generation where the subsidy is used to support capital and distribution costs, but in respect of biomass the bulk of the subsidy is used to support bringing the fuel to the generators’ gates and, as such, the RO actually has some perverse consequences.
In particular, the RO encourages the cherry-picking of biomass fuel types in favour of those that will generate greatest profit, rather than focusing on those fuel types that will, in the long run, actually lead to greater environmental returns, such as short rotation crops, energy crops and energy from waste.
Furthermore, the RO doesn’t on its own encourage efficient generation, evidenced by the fact that the majority of large-scale energy proposals currently in the pipeline are electricity only.
Carbon balance studies
Carbon balance (accounting) studies (such as An analysis of carbon emissions for different end of life scenarios for virgin, recycled and low grade wood fibre by Carbon River Sustainable Commerce Systems, www.makewoodwork.co.uk; and Bio Energy – A carbon accounting time bomb, by Birdlife International) highlight the point that whilst biomass is generally carbon neutral over its life cycle, because trees have a relatively long life cycle (typically 40 years for European softwoods) net CO2 emissions over the next 20-30 years could actually increase if wood formerly used for product manufacture is displaced by burning.
As well as supporting the case for focusing biomass policy towards short rotation biomass types or end of life wastes, this brings into sharper focus the need to look at the carbon storage potential of different raw materials. The question is whether the best use is to burn them in the first instance or is it better to capitalise on their economic value in product manufacture and their environmental value as a carbon store which, in some product applications, could run into several decades or, depending on species, hundreds of years?
The widely respected study by John Clegg Consulting published earlier this year, which looked at the potential availability and demand for wood fibre (from all sources) in Britain, identified that demand for some wood sources is already outstripping supply. It said that, over the next five to seven years, demand could be more than double the potential supply, leading to a requirement to import up to 30 million tonnes of woodfuel.
The negative consequence of this scenario is that domestic wood costs will rise to match that of the import cost of woodfuel which could be two to three times higher than that currently paid by wood-processing companies. With some developers of wood-fired electricity projects seeking to source between 10-15% domestically, the risk of displacement of supply from other wood-using industries is a distinct possibility. If this occurs ‘green jobs’ will be put at risk as well and the very essence of what the policy is aimed at – ie, reducing CO2 emissions – will be undermined.
With colleagues across the forest industries, the Wood Panel Industries Federation (WPIF) lobbies for a policy that values wood as a multi-functional raw material and as a carbon store. As a fuel, wood is too valuable to allow it to be burnt inefficiently. The domestic wood basket can’t support the capacities being discussed, but there is potential to bring some under-utilised forest material to market and there is also potential for growing fast rotation crops/forestry dedicated for use as fuel. Rather than having a blanket policy that leaves unintended consequences in its wake, local supply can be nurtured to suit the local energy demands whilst balancing the needs of other wood-processing industries.
Waste heirarchy
Waste is another resource that is better managed locally/regionally. The revised Waste Framework Directive now introduces the waste hierarchy into national legislation. Provided it’s transposed robustly, more material that has potential to be recycled should come to market. Based on WRAP’s most recent waste wood study, we estimated that around 2.4 tonnes per year of wood waste is currently going to landfill. On several levels it surely makes more sense to utilise this resource as fuel ahead of material that still has economic and environmental value.
Policy is moving in this direction but barriers remain and particularly the perceived health concerns. In this regard, the Health Protection Agency reported in 2009 that “Any health effects arising from emissions from a well-run and regulated incinerator were likely to be so small as to be undetectable”.
The subsidy regime in its current form is starting to unbalance the market for wood, a process which, if left uninterrupted, will inevitably lead to the loss of established industries. What’s less clear, but which is nevertheless a risk, is the impact a market dominated by large-scale generators would have on smaller scale projects and on those trying to build fuel markets to supply smaller scale but more efficient heat and power plant.
We call for incentives to be refocused to reflect the hierarchy of benefit and to Make Wood Work.
? Make Wood Work is the WPIF’s five-point plan to safeguard the wood-based panel industry’s future in the face of threats from developments in the biomass sector.
