Confor chief executive Stuart Goodall has had an encouraging meeting with government officials on the thorny issue of biomass subsidies paid to the energy sector.
Mr Goodall said his meeting at the Department of Energy and Climate Change (DECC) on Tuesday resulted in an agreement to work on an analysis of the ability to pay that the Renewable Obligation Certificate (ROC) provided to energy companies and whether that would enable them to outcompete sawmillers.
Mr Goodall said the official listened carefully and asked probing and challenging questions on the subject.
“This felt more useful than previous engagement and he gave the impression of wishing to get to the bottom of the matter, rather than just try to manage the issue which is how others [previous officials] came across.”
Mr Goodall admitted that previous meetings at the DECC had left him concerned that the department didn’t grasp how damaging large wood burning electricity plants could be for the UK forestry and wood processing sector.
“I explained that as well as threatening to drive out existing wood users, such as sawmills, it was an unattractive market for wood producers.
“These energy businesses will have the scale to drive out competition (and then drive prices for wood down), and they will only exist as long as they receive ROC payments.
“For a producer this carries the threat of losing competition for their wood and long term seeing a dominant market player disappearing over-night.”
Mr Goodall suggested that incentives for power plants to use biomass should be dropped for domestic wood but retained for imported material.
But he was told that it was unlawful to discriminate under EU trade rules.
