The Wood Panel Industries Federation (WPIF) and the British Furniture Confederation (BFC) have both campaigned against government support for power stations to use biomass in large-scale electricity generation, arguing that it allows energy companies to unfairly compete in wood raw material purchasing.
The government’s Electricity Market Reform Delivery Plan, released for consultation on July 18, recommends subsidies for existing power stations converted to burn biomass to end in 2027.
The government is also proposing to cap payments to new dedicated biomass electricity-only power stations at 400MW. Dedicated combined heat and power (CHP) plants will be exempt.
Energy minister Edward Davey also told the BBC last week that using imported wood biomass to make electricity was not a long-term answer to the UK’s energy needs.
"We have long argued that biomass-fired power-only generation was both a wasteful use of wood but also significantly threatened existing wood processing industries," said WPIF director-general Alastair Kerr.
"Whilst not eliminating that threat, the signals this sends should help in the long term to limit the scale of development."
But Mr Kerr warned that while it seemed to be signalling a welcome change in policy direction, the industry should not be complacent. "Far from it, the policy is shifting towards renewable heat and combined heat and power."
He said WPIF was not opposed to CHP but it was important to ensure renewable heat capacity developed at a scale and pace consistent with domestic wood resources.
The British Furniture Confederation said biomass subsidies were increasing timber prices and having a "devastating" knock-on effect on UK furniture manufacturing.
"This is a victory for common sense and a result of the industry’s lobbying, which helped to highlight the issues caused by the biomass subsidies," said BFC chairman Paul von der Heyde.
Power company Drax, which is converting several power stations to biomass, insisted the government’s recommendations were not a fundamental change in government policy.
"Biomass conversions from coal are a key element of the package of renewables required to meet carbon reduction targets from 2020 and beyond," a Drax spokesperson said.
Drax said it had planned for an end to subsidies within its power station conversion plans.
The government says its recommendation to cap payments to dedicated electricity-only plants at 400MW was a way of providing a mechanism to allow those projects which are already well advanced (and where power companies had already invested heavily) to be completed.
