House of Commons - Welsh Affairs

Select Committee on Welsh Affairs Third Report

9 Biomass

240. Biomass comprises any organic material that can be converted into energy including waste materials and refuse, forest residues, agricultural wastes and specifically grown crops. Biomass can be used directly through combustion for heat energy or converted into other forms including gas, electricity and hydrogen.[496] The Biomass Task force defined biomass in its widest sense literally, any biological mass derived from plant or animal matter. This includes material from forests, crop-derived biomass including timber crops, short rotation forestry, straw, chicken litter and waste material. Planning and Policy Statement 22 defines biomass as "the biodegradable fraction of products, wastes and residues from agricultural (including plant and animal substances), forestry and related industries, as well as the biodegradable fraction of industrial and municipal waste".[497]

241. At the moment, 4% of the EU's energy is produced from biomass. However, Dr Valentine described biomass as "the sleeping giant of renewables".[498] Indeed, the EU Action Plan states that energy production from biomass could be doubled by 2010. Currently, the United Kingdom lags behind the rest of Europe in the burning of biomass, (excluding energy from waste), which contributes about 1.5% of the UK's electricity and about 1% of its heat.[499]

242. The Country Land and Business Association and the National Farmers Union estimate conservatively that 25-30% of agricultural land could be used for biomass production by 2020 (approx. five million hectares). This amount of land would be able to produce nearly 200TWh electricity, which is more than 50% of current energy consumption in the UK.[500]

UK Government Strategy

243. Gary Shanahan, Assistant Director, Bioenergy and Marine Renewables, DTI, told us that the Government had committed £66 million towards capital grants for biomass projects two years ago and he highlighted the Combined Heath and Power Plant project in Port Talbot as a beneficiary of that scheme. He added that the Government was considering what further support might be required in light of the report from the Biomass Taskforce.[501] That strategy will be launched in January 2007.[502]

244. The DTI calculated that biomass has the potential to supply around 6% of electricity demand by 2020 and the UK Government is supporting the bio-energy industry with a package of measures to help establish the crops, develop supply chains and create markets. That included working with farmers and industry to develop markets and promote uptake of bioenergy from purpose-grown energy crops, forestry and other sources such as biodegradable waste.[503]

Welsh Assembly Government Policy on Biomass

245. The Report from the Biomass Taskforce was produced in an England context, because its remit covered matters that are devolved in Wales. However, the principles of the report are applicable to Wales.[504] The Welsh Assembly Government actively supports biomass and that position is reflected its Energy Route Map, which set out plans to publish a biomass energy strategy for Wales with relevant targets by mid 2006.[505] Andrew Davies AM told us that the Strategy would take a holistic view of potential biomass developments, taking into account the findings of the recent Gill and Carbon Trust reviews and the existence of the relevant world class expertise at the Institute of Grasslands and Environmental Research (IGER) at Aberystwyth.[506]

246. We look forward to the publication of the Government's UK-wide Strategy for Biomass, and how that strategy will take forward the conclusions and recommendations of the Biomass Task Force. We also welcome the Welsh Assembly Government's intention to publish a Biomass Strategy for Wales, and seek clarification from the DTI on how the Welsh Biomass strategy will feed in to the UK Biomass strategy.

Biomass in Wales

247. The All Wales Energy Group placed biomass, along with hydro-electric and tidal schemes, as the most consistent and reliable power supplies of all the renewables.[507] The Renewable Energy Foundation claimed that the potential in Wales for biomass energy was considerable, and promised "truly sustainable benefits".[508] Dr Constable asserted that biomass could offer "real opportunities to generate energy locally, provide affordable heat, reduce consumption of hydrocarbons, and also provide an incentive for sustainable forestry".[509]

248. The Environment Centre noted that Wales had the potential to provide enough biomass fuel sources to generate over half of the renewable energy targets set by the Welsh Assembly Government. However the Centre believed that, in practice a figure in the region of a quarter of the target was more plausible.[510]

ENERGY CROPS IN WALES

249. Biomass or energy crops are purpose grown crops for the production of biomass material for renewable energy generation. There is a wide range of crops that can be grown as an energy crop; the only requirements being that the crop produce biomass within a short time-frame, and that that it is suitable for conversion into energy, for example low moisture content. The most frequently grown energy crops in the UK include fast growing woody species such as willow and poplar and grasses such as Miscanthus and Reed Canary grass.[511]

250. There is considerable potential for the growth of energy crops in Wales. Kevin Mowbray of the Welsh Energy Research Centre informed us that Wales consumed about 9.5 million tonnes of oil equivalent. He added that "if you take the biomass, then open land for cultivation is around 700,000 hectares. If you used 10% of that for cultivation of energy crops, you will actually get round about 0.35 million tonnes of oil equivalent in energy crops. That is 30% of the 10% (WAG renewable target) towards 2010".[512]

251. Despite the potential for energy crops in Wales, no specific energy crop scheme has been developed as the Welsh the Assembly Government has focused its resources on "expanding demand for energy crops rather than risk oversupply of a fledgling market".[513] That said, the Welsh Assembly Government has supported the development of a Welsh-based energy crop trial through 'Willows for Wales'.

252. The 'Willows for Wales' project is funded by the European Regional Development Fund.[514] It is co-ordinated by the Institute for Grassland and Environmental Reasearch and also involves Cardiff University, the Forestry Commission, EGNI, Mid-Wales Energy Agency, RWE npower, Renewable Energy Ltd., SW Seed Ltd., and Agrobransle. The objective is to evaluate and demonstrate the potential of short rotation coppice willow as a biomass crop in Wales. The consortium represents interests and knowledge of the crop and its marketing into energy generation systems. An important aspect of the project was that it engaged farmers as partners in establishing crop test sites and as potential commercial producers. Growing Willow for energy will not affect the Single Farm Payment as long as the grower has a contract with an energy user.[515]

253. We welcome the investment that has been put in to research projects such as the Willows for Wales scheme. We look to the Government to provide a strategic framework in which energy crops in Wales can become a commercial reality.

WOOD FUEL

254. Dulas Ltd. told us that of all the renewable energy technologies, wood fuel biomass was the one that could "bring the highest level of local and regional economic benefit" to Wales.[516]Rod Edwards, the Director of Dulas Ltd., explained that "the wealth generated from the processing and supply of fuel remained within the local economy, rather than leaking out. Moreover, fuel supply offered the prospect of additional income streams for the indigenous forestry contracting industry in Wales".[517]

255. The All Wales Energy Group identified significant potential for developing wood fuel in Wales.[518] Forestry in Wales covers about 14% of the land area, just under 290,000 Hectares. About 195,000 Hectares of that was conifer, and the Mid Wales Energy Agency believed that if converted into wood chips or pellets, it would be sufficient to heat anywhere between 10.3% and 19.6% of the entire housing stock in Wales.[519]

256. However, Malcolm Harrison, Business Development Director for Express Power, pointed out that compared with the rest of Europe, "we are pretty well down the league table".[520] In terms of primary energy developed from wood, in 2004 France generated just over 9% of its primary energy, followed by Sweden at just over 8%, Finland at 7%, Germany at 6%, Spain at 4% and Poland at just about 4%. However, the UK generated only 1.2% of its primary energy from wood.[521] While Malcolm Harrison acknowledged that this could be to do with the wood resource in those countries, he argued that equally it could be down to the different regimes that encourage biomass in those countries.[522]

257. There is a great potential for wood fuel in Wales to contribute to energy generation, local wealth generation, and the maintenance of the forestry industry in Wales. We urge both the DTI and WAG to develop a biomass strategy that would maximise that potential.

Biomass for Electricity

258. While the Biomass Taskforce report makes reference to biomass for electricity schemes in both England and Scotland, there are no major biomass electricity plants in Wales. Our witnesses identified several issues as to why the biomass for electricity sector in Wales was under-developed. Rod Edwards from Dulas Ltd., told us, that because of the capital costs of plants and the cost of fuel, it was difficult to generate electricity that could compete. However, he believed that the situation was changing, and the market price for electricity was increasing, hence making biomass more attractive", and was of the view that it could play a part in electricity generation in the future.[523]

Biomass for Heat

259. Although biomass electricity generation is very much in its infancy, biomass for heat was quickly becoming a reality. Rod Edwards from Dulas Ltd. explained that until recently using biomass for district heating had not really been viable because of the relatively low cost of oil and gas. However, the increase in those fuels would make the biomass industry reassess the viability of district heat networks. He described it as "the biggest breakthrough",[524] in biomass and asserted that within Dulas' biomass business there was a "huge increase" in interest in biomass heating technology.[525]

260. The Countryside Council for Wales told us that in Wales, the best solution for biomass for heat was to concentrate on smaller scale installations, such as schools or institutions, and small scale local heating and energy generation. The Council highlighted the example of Coed Cymru who have developed a small scale wood pelleting process which supports the development of such initiatives, allowing pellets to be produced locally.[526]

261. Friends of the Earth Cymru highlighted a second example. In 2000, the Pembrokeshire Energy Agency installed a wood pellet heater at its office based at the West Wales Eco Centre in Newport, Pembrokeshire. A partnership, involving the Agency, the Eco Centre, the County Council, the National Park Authority, a consultant and a local school, was established to promote the fuel. As a result, Ysgol Preseli, Crymych Leisure Centre and the newly refurbished offices of the Pembrokeshire Coast National Park Authority at Pembroke Dock were now heated by wood pellets rather than oil.[527] Furthermore the Llanwddyn project installed heating boilers at a school and community centre. The system is fuelled by forest residue wood-chip and provides heat, through district heating to over 30 of the local houses as well as to the school and community centre.[528] More recently Western Bioenergy have proposed a 13.8 MW wood-burning biomass power plant in Port Talbot, south Wales, currently going through the planning stages with advice from Sustainable Energy Ltd., Cardiff.

262. Probably the most public example of biomass for heat is the new Senedd Building in Cardiff Bay, which is heated through a 360kW wood-chip or pellet burning boiler.[529]

263. While Rod Edwards emphasised the fact that the Welsh Assembly Government was fully behind the prospect of using particularly biomass for heat production, he hoped that incentives and requirements would be included in biomass strategies at both the UK and Welsh level. He said that he understood that "it is under consideration on a UK-wide basis in which case I sincerely hope the Welsh Assembly will reflect that policy because I think it will give an added driver to the renewable heat market which is a very important market".[530]

264. We welcome the use of biomass for heat production, and welcome the schemes and initiatives that have proved the success of this technology to date. However, we agree with our witnesses that the UK and Welsh Assembly Governments should formalise their support for biomass for heat by providing incentives for renewable heat generation, and that in any revision of the Renewable Obligation Certificates, biomass for heat should be included, but the impact on other industries competing for the same feedstock should be considered.

The Future of Biomass in Wales

265. Dr John Valentine identified several reasons why biomass was not currently making a greater contribution to Wales' renewable energy portfolio. They included "the ignorance of the potential, perceived as complex or high risk, a lack of policy clarity and a fragmented approach within government. There was too much emphasis on electricity and not heat and a lack of robust supply chains".[531] The Countryside Council for Wales added that lack of confidence appeared to be a major barrier to uptake.[532] Dr Valentine concluded that confidence inducing measures and setting targets were essential to kick-start the biomass industry.[533]

266. Despite those concerns, Dr Valentine was optimistic about the potential future for biomass in Wales and stated that "there is a realisation that there is a limit to wind and now it is biomass' turn as it were".[534] He asserted that biomass was more profitable than it had been and that economies of scale and local supply had the potential to further improve that situation.[535]

267. In conclusion, Dr Valentine recommended the need for a one-stop-shop biomass advice centre for Wales. He noted that "there is a lot of information on biomass spread over a wide range of expertise and no one person knows it all. That information has to be got over. Rather like the Organic Centre Wales, it could be a virtual or it could be real centre and it could also provide the voice to the Assembly".[536] The Countryside Council for Wales supported this, and recommended the expansion and dissemination of best environmental practice guides, for example, for Miscanthus and other energy crops.[537]

268. We acknowledge the steps required to promote and secure the future of biomass energy in Wales. We urge the DTI to include these steps in its UK Biomass Strategy, and we recommend that funding be made available to establish a one-stop shop biomass advice centre for Wales at the earliest opportunity.

496 www.walesbiomass.org/bio-biomass.htm Back

497 www.defra.gov.uk/farm/acu/energy/biomass-taskforce/btf-finalreport.pdf Back

498 Q 378 Back

499 Energy White Paper: Our energy future - creating a low carbon economy, DTI, February 2003, CM 5761 Back

500 Guide to UK renewable energy companies 2003, (2003), James & James (Science Publishers), London. Back

501 Q 91 Back

502 Ev 241 Back

503 Ev 5 Back

504 Ev 286 Back

505 www.wales.gov.uk/subitradeindustry/content/consultations/ewrm-map-e.pdf Back

506 Ev194-6 Back

507 Ev 178 Back