Life after the Energy Crops
Scheme
David Turley, NNFCC Lead Consultant
Biomass Feedstocks
Energy Now, Feb 2014, Telford
Copyright © NNFCC 2012.
What have we achieved in the UK
0
2000
4000
6000
8000
10000
12000
14000
16000
2010 2011 2012
Renewable Power (GWhe)
otherbiomass
AD
co firing
plantbiomass 0
200
400
600
800
1000
1200
1400
2010 2011 2012
Renewable Heat (1,000 toe)
otherbiomass
wood
plantbiomass
Copyright © NNFCC 2012.
Energy crop areas supported by planting grants
Natural England data on area supported (ha) to November 2011
0
1000
2000
3000
4000
5000
6000
7000
8000
SRC Miscanthus
9496 ha in total
ECS2 2007-2013
ECS1 2000-2006
Copyright © NNFCC 2012.
Energy crop planting
ETI and E4Tech, based on Natural England data
ECS1 Closure
Energy Crop Planting Locations - England
ETI and E4Tech, based on Natural England data
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Factors affecting uptake
• Technical/infrastructure
• Economic
– High establishment cost
– Impacts on cash-flow
– Competition with
arable returns
Copyright © NNFCC 2012.
Factors affecting uptake – Policy Uncertainty
Renewables Obligation (RO) (renewable power support)
• Capping of grandfathered (protected) support for new
dedicated biomass capacity at 400MW
• Loss of energy crop uplift (worth 0.5 RO Certificates /MWh)
from 2013 for new plants
New Contract For Difference support mechanism
• No strike price for dedicated biomass
Rural Development Policy
• No replacement for Energy Crop Scheme
Copyright © NNFCC 2012.
UK Biomass feedstock requirement for existing and power plants in
planning or development by developer/generator (NNFCC Data)
1.74
6.96
1.74
0.00
4.52
6.78
0.51
0.51
0.51
0.51
1.57
1.57
-
2
4
6
8
10
12
14
16
18
Feedstock
demand - 2015
Feedstock
demand - 2020
Mill
ion
to
nn
es
of p
elle
ts p
er
an
nu
m
RWE Lynemouth
Helius Energy
RES
Drax
Eon
Eggborough Power
Copyright © NNFCC 2012.
Renewable Heat Incentive
• Non Domestic Scheme was launched Nov 2011 by DECC,
supporting biomass as an eligible technology (excludes direct air
heating)
• Domestic RHI Scheme to launch in Spring 2014 , which will also
cover biomass-only boilers and biomass pellet stoves with
back-boilers
– Targeted at off-gas grid applications
RHI Tariffs
Non domestic RHI Plants Commissioned from April 2014 (p/kWh)
Tier 1 (up to first 15% of annual rated
output)
Tier 2 (annual
output above Tier 1)
Small biomass <199kWth
8.6 2.2 7.2 (typical average)
Medium biomass 200kWth to 1MWth
5.0 2.1 4.4 (typical average)
Large biomass >1MWth
2
Biomass CHP 4.1
Domestic RHI - biomass boilers
12.2
Copyright © NNFCC 2012.
RHI – Non Domestic Scheme
Applications for
Non-domestic RHI
(DECC Data)
574MW of installed
capacity by Oct 2013
Copyright © NNFCC 2012.
Development Potential
64% 12%
4%
16%
4%
Space heating
Water heating
Cooking/catering
Process use
Drying/separation
Total UK heat
use by
application
(70 mtoe)
Copyright © NNFCC 2012.
UK heating installations by fuel feedstock
0
5,000
10,000
15,000
20,000
25,000
0
500
1,000
1,500
2,000
2,500
1968 1973 1979 1984 1990 1995 2001 2006 2012
Co
un
t 0
00
's (
gas
on
ly)
Co
un
t, 0
00
's (
no
t in
cl.
gas)
Solid fuel Electric storage Other electric Oil Gas
DECC Data
Copyright © NNFCC 2012.
Boiler replacement opportunities
NNFCC data, based on conservative replacement rates for
conversion to biomass
Domestic
• 1700-1900 oil fired boilers per year
• 500-1000 solid fuelled boilers per
year
Wessex Biomass
Pelletstar
Copyright © NNFCC 2012.
Supporting policies – direct rural support
• The Rural Community Energy Fund (RCEF) (details from WRAP)
– launched June 2013, £15 million to support rural
communities in England to develop renewable energy
projects providing economic and social benefits to the
rural community
• Stage 1 - provides a grant (up to £20,000 ) to assess feasibility
of renewable heat or power projects
• Stage 2 - provides an unsecured loan of up to £130K to support planning applications and develop a business case
for investment
Copyright © NNFCC 2012.
Supporting Policies – other rural support
• CAP Reform Framework (2014-2020)– Rural development
proposals
– encourage supply of non-food/feed resources to support
the developing bioeconomy
– encourage renewable energy investment
– support for cooperative developments and
demonstrations
– BUT - Defra needs to give energy crops the appropriate
priority, which is not guaranteed, we await more detail!
Copyright © NNFCC 2012.
Concluding Comments
• There is no specific policy measure that currently recognises
the value of domestic biomass
• Stop/start nature of direct support has not been helpful
• A supportive industry has developed and is poised to exploit
the opportunities available
• RHI appears to offer a significant opportunity for local energy
crop development less reliant on direct support
– Own heat supply
– Involvement in local heat supply chains
IEE – Forest Partnerships for Success
Celebrating 10 years of Bioeconomy
development
NNFCC is a UK based consultancy with
expertise on the conversion of biomass
to bioenergy, biofuels and biobased
products.
We help industry solve complex
business challenges and provide vital
evidence for policy makers.
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