Understanding the cost of the Drax BECCS plant to UK consumers

Ember estimates the proposed biomass energy and carbon capture and storage plant will require £31.7 billion in subsidy.

Yet there is a major risk that the plant will not deliver the negative emissions promised

Published May 25th 2021

Authors: Phil MacDonald, Tomos Harrison

 

In this paper Ember has examined existing estimates of BECCS costs, and used them to calculate the level of public subsidy required to build and operate Drax’s new power station. Drax has not revealed the size of the new subsidy it is requesting from the UK government. However, our research, using the middle range of studies commissioned by BEIS, reveals that a large subsidy will be necessary, similar in size to that of the controversial Hinkley Point C nuclear project. This paper also highlights that, due to the risks of high carbon emissions from harvesting and burning wood, Drax’s new power plant may not be able to deliver negative emissions at the scale or in the timeframe it promises.  

High price tags are sometimes necessary for innovative green technologies. But with biomass, there’s a real risk that the UK doesn’t get what it’s paying for. 

We must be absolutely certain we’re not spending billions of pounds to accidentally increase our contribution to climate change.

The UK also has a key role to test and commercialise green technologies that can be used around the world: if BECCS can’t realistically scale internationally, it’s not the right choice for the UK.

Phil MacDonald

COO, Ember

Executive Summary

The UK’s largest power station is looking for a new subsidy. In 2027, Drax’s £10 billion of subsidies to burn wood for power will come to an end, and Drax plans to build the world’s first bioenergy with carbon capture and storage (BECCS) plant . By capturing the carbon emissions of wood burned for electricity and storing them under the North Sea, Drax intends to generate the negative emissions the UK is reliant upon to reach national climate targets and would seek to be rewarded for this through new public subsidy. However, without regulation, the government cannot be sure that BECCS will deliver the negative emissions being paid for.

 

How much will the new BECCS plant cost the UK consumer?

£31.7 billion – equivalent to almost £500 per person in the UK, directly adding more than £16 a year to each household’s energy bill.

For comparison, the National Audit Office has estimated Hinkley Point C nuclear power station will cost consumers £30bn in total, a project which has been described as the world’s most expensive power station.

£31.7 billion is Ember’s central estimate (from a range of £23.5 billion – £44.3 billion) for the total cost to the UK energy bill-payer of Drax’s proposed BECCS plant (bioenergy with carbon capture and storage), over a 25 year plant lifetime. Total subsidy was calculated using cost estimates from the 2020 study commissioned by the Department of Business, Energy & Industrial Strategy completed by Ricardo.

Will the BECCS plant deliver the negative emissions the UK requires?

Current regulations are not sufficient to prevent unsustainable and high-risk biomass feedstock from being burnt in UK power stations. For example, feedstocks from primary, high-carbon, highly biodiverse or slow-growing forests.

Without additional regulation, the government cannot be sure that BECCS will deliver the negative emissions being paid for.

In the worst-case scenarios outlined in research commissioned by BEIS, burning biomass can produce greater emissions than those from burning coal. A BECCS plant using these feedstocks would be a net emitter, not a net carbon sink.

Negative emissions play a key role in the Climate Change Committee’s plan to reach net zero, and ahead of COP26 the UK government is keen to make progress towards negative emissions. But the ability of BECCS to deliver negative emissions is dependent on the carbon neutrality of biomass, an assumption that is no longer reasonable within the current regulatory framework. Indeed the European Academies Science Advisory Council (EASAC) now states that using woody biomass for power “is not effective in mitigating climate change and may even increase the risk of dangerous climate change.”

The use of…biomass for energy cannot be considered to be automatically carbon-neutral under all circumstances, though most policy frameworks treat it as though it is. In reality, carbon dioxide and methane will be emitted from the combustion of woody biomass…and from its supply chain of harvesting, collecting, processing and transport.”  – Chatham House (2017)

In this paper Ember has examined existing estimates of BECCS costs, and used them to calculate the level of public subsidy required to build and operate Drax’s new power station. Drax has not revealed the size of the new subsidy it is requesting from the UK government. However, our research, using studies commissioned by BEIS, reveals that a large subsidy will be necessary, similar in size to that of the controversial Hinkley Point C nuclear project. This paper also highlights that, due to the risks of high carbon emissions from burning wood, Drax’s new power plant may not be able to deliver negative emissions at the scale or in the timeframe it promises. 

 

Recommendations

The principal message of this briefing is that the government must proceed cautiously with support for BECCS until the negative emissions it is paying for are guaranteed – within a timescale relevant to achieving the UK’s climate ambitions. Before contracting a commercial-scale plant, more needs to be understood about the true carbon cost of imported forest biomass over timescales compatible with the Paris Agreement – and the very high-carbon scenarios completely ruled out.

1

To facilitate the necessary public debate over BECCS, Drax should publish estimates for the subsidy requirements for BECCS  – and a full lifecycle assessment of the carbon impact of their biomass feedstocks, with realistic counterfactuals.

2

In the Sixth Carbon Budget, the Climate Change Committee state “the development of BECCS is contingent on sourcing sustainable biomass, given concerns over the associated lifecycle emissions”. It is essential that UK regulations on sustainable biomass are tightened.

3

With BECCS playing an important role in many climate scenarios, less risky routes for biomass feedstock should be explored – especially in sourcing domestic energy crops on degraded land, which are less likely to have a large emissions impact.

4

Carbon accounting isn’t just messy when it comes to biomass imports – the UK’s carbon budgets also bundle emissions mitigation and negative emissions. To give clarity on the scale of negative emissions necessary under our 2050 net zero law, residual emissions and negative emissions budgets should be unbundled.

5

Given BECCS cannot yet be relied upon to provide true net negative emissions, there’s an urgent need to understand other routes to provide negative emissions – and reconsider the potential for further emissions mitigation to minimise the requirement for net negative emissions.

Bioenergy has more than a whiff of the emperor’s new clothes. There are still major gaps in the argument for this technology: serious evidence that calls into question how effectively it cuts emissions at all.

If we invest billions into technology that turns out to be just as polluting as fossil fuels, we’ll be saddling the next generation with vast national debts to repay. There are better bets than bioenergy such as direct air capture technology, and wind and solar

Lord Randall

Former MP for Uxbridge and South Ruislip and environment advisor to Theresa May

We should always be wary when any business goes cap-in-hand to the government for subsidies – especially one from the energy sector. If Ember’s analysis is correct, British consumers will be forking out for expensive electricity with questionable environmental credentials.
 
Subsidies like this are perfect ammunition for critics of Net Zero – who will no doubt weaponise them in the debate on whether to take greater action to end our contribution to climate change.
Eamonn Ives

Centre for Policy Studies