Bioenergy team visit energy crop fields

October 17, 2011 in Bioenergy Review, Power, Uncategorized, renewable energy by Committee on Climate Change

By Senior Analyst, Kavita Srinivasan

Members of the CCC Bioenergy team recently joined experts on bioenergy from the  National Farmers’ Union  to visit two miscanthus and short-rotation coppice (SRC) willow farms in Yorkshire. The farms supply woody biomass directly to Drax and other power stations for co-firing, as well as for local heat applications.

Miscanthus can be used as an energy crop

Miscanthus, known as elephant grass, and SRC willow, a woody perennial crop, have been identified as the more suitable perennial energy crops for growing in the UK. Both crops can grow on poorer quality land, require fewer inputs, and have been found to host higher levels of biodiversity relative to conventional crops.

The market for SRC willow and miscanthus has developed over the past ten years under the Energy Crop Scheme, which subsidises 50% of costs incurred over a five-year period. Currently there are 10-15,000 hectares of willow and miscanthus in the UK.

After touring both farms, the CCC met with energy crop growers, suppliers and advisers. All growers indicated that both miscanthus and willow had provided a solution for poorer quality arable land where they had struggled to produce consistent wheat yields or in areas where access for growing conventional crops proved difficult (e.g. steep banks and awkward corners).

CCC bioenergy team

To stimulate further market development, growers also called for longer term support (i.e. greater than five years), interest-free loans to aid in the purchase of equipment, and the potential for receiving funding under agri-environment schemes (payments currently made to conventional crop farmers for delivering environmental management). All emphasised the role that domestic energy crop production could play in securing a sustainable supply of bioenergy to meet the UK’s renewables targets.

The CCC’s Bioenergy review will be released at the end of 2011. This will include our detailed assessment of investment in biomass power generation, focusing on technical feasibility, economics and availability of sustainable biomass.

CCC visit Drax power station

October 13, 2011 in Bioenergy Review, Power, Russell Bishop, Uncategorized, renewable energy by Committee on Climate Change

By Russell Bishop, Economist at the CCC

Members of the CCC bioenergy review team went to Yorkshire to visit Drax power station. Drax is Western Europe’s largest coal-fired power station and has a generating capacity of 4000 megawatts, producing 26 TWh of electricity in 2010 meeting approximately 7% of the UK’s electricity demand.  The plant consumes 10 million tonnes of coal each year and is the largest single source of CO2 in the UK, with annual emissions are approximately 22 MtCO2e,  broadly equivalent to all emissions from heating in the commercial and public sectors.  It also co-fires coal with biomass and is the largest generator of renewable power in the UK.

Drax power station

Biomass accounts for 15-20% of the plant’s annual fuel use. Drax uses a wide range of both domestic and internationally procured biomass (mainly wood pellets, straw and miscanthus) which is delivered to the site either by road or through Drax’s own dedicated rail wagons. All of the biomass used on site must first be converted to pellets suitable for use at the main power station.  While significant amounts of the plants imported biomass will already be pelletised, as part of a tour of the facility we saw the company’s off-site straw pelleting plant which converts locally sourced straw to pellets.

The actual processing of the biomass is through a “processing tower” whereby the biomass pellets are ground into dust, which is then directly injected into the plant’s boilers for combustion (we are not talking domestic boilers here, each boiler is 15 storeys high and weighs 4000 tonnes!).  As Drax looks to expand the use of biomass use in the future, it is undertaking R&D into greater boiler efficiencies through enhanced co-firing, with the aim to both reduce emissions and environmental impacts.

Sustainable sourcing of biomass is imperative to ensure significant life cycle emissions savings relative to fossil fuels and to encompass other wider sustainability issues (e.g. biodiversity and land use implications).  Drax has implemented its own sourcing criteria but from April 2013 the UK government will require all large generators to meet minimum sustainability criteria in order to receive Renewables Obligation Certificates.

The CCC’s Bioenergy review will be released at the end of 2011. This will include our detailed assessment of investment in biomass power generation, focusing on technical feasibility, economics and availability of sustainable biomass.

CCC visit to Tilbury power station

September 15, 2011 in Uncategorized by Committee on Climate Change

Indra Thillainathan

Indra Thillainathan

By Indra Thillainathan, Senior Analyst

With new European environmental legislation set to close many existing coal fired power stations by 2015, work is already underway by Tilbury power station to convert it into one of the world’s largest dedicated biomass generators . Ahead of its scheduled re-commissioning in November, a few members of the CCC made a visit to the Essex based plant earlier this month to see how work was progressing.

The 1,050MW coal fired Tilbury ‘B’ plant had been generating electricity since 1967. However, EU legislation to reduce emissions under the Large Combustion Plant Directive (LCPD) prompted the owner, RWE npower to look at options that could extend the life of the plant. Work for the first phase will see a switching of feedstock from coal to biomass, with a generating capacity of 750MW. Life cycle CO2 emissions are expected to be around 80% lower than for a similar sized coal fired power station. However, as Nigel Staves, the station manager pointed out, the plant will still be required to close under the LCPD unless a secondary more comprehensive and costlier programme of works is carried out in order to meet new plant regulations. Npower is currently looking at options to do this.

inside 55 metre high furnace

inside 55 metre high furnace

Located on the Thames Estuary, Tilbury will rely on imported sources of wood pellets that will be delivered to its own jetty.  The issue of sustainability was at the forefront of everyone’s minds, given the large volume of biomass feed that it expects to consume each year. But with feed derived from pine beetle damaged wood and timber residues from British Columbia and Georgia in the USA, npower are satisfied that the feedstock under the first phase will be sustainable.  Should the second phase proceed, npower is undertaking R&D into alternative feeds to forestry materials. These alternative feeds are not expected to become available until the next decade or two.

Although the plant was closed for the conversion, a tour of the site enabled us to see up close some of the technology involved in the process of generating electricity. This included standing inside one of the vast 55m high furnaces where temperatures can reach up to 1,100 degrees to heat re-circulating purified water to produce high pressure steam to drive the turbine.  Our tour ended in the control room of the plant.

control room at Tilbury Power Plant

control room at Tilbury Power Plant

The CCC’s Bioenergy review will be released at the end of 2011. This will include our detailed assessment of investment in biomass power generation, focussing on technical feasibility, economics and availability of biomass supply.

Green growth: paradigm shift or just spin?

September 1, 2011 in Dr Samuel Fankhauser, Green growth, Low-carbon economy by Committee on Climate Change

by Alex Bowen and Sam Fankhauser, Grantham Research Institute for Climate Change and the Environment. This blog post is a reprint from a post on the Climate and Development Knowledge Network

There is much talk at the moment about green growth – environmentally sustainable, biodiverse, low-carbon and climate-resilient growth in human prosperity. Policy makers are attracted by the fact that green growth allows environmental protection to be cast as a question of opportunity and reward instead of costly restraint.  Analysts like the green growth idea because it abandons the narrow focus on emission reduction costs for broader, more nuanced and richer strands of economics.

Green growth enriches the policy debate in four important ways.

First, green growth reconnects long-term environmental sustainability with the understandable concerns of politicians about short-term macroeconomic issues like debt, unemployment and the performance of the economy.  The calls for a green fiscal stimulus, which started at the height of the world economic crisis, draw on this perspective.  A continuing weak economy, low interest rates and high unemployment mean that this aspect of the agenda is still relevant.  Where government budgets allow, timely and targeted investment in environmental projects could boost GDP and ensure an environmentally sound recovery.

Second, green growth espouses a much wider view of how and why markets fail. The problem is not just that markets ignore the value of the environment. Markets also malfunction if there are information problems, if firms have monopolistic power or if innovation is not properly rewarded. These market failures can interact and reinforce each other.   Large welfare gains are possible from well-designed taxes, subsidies and regulatory measures that deal with them comprehensively. However, if green growth measures are ill thought out, they could also dent the effectiveness of policies.

Third, green growth recognises that the economic changes required are not mere meddling at the margin.  New inventions and social changes in response to environmental imperatives could trigger a new industrial revolution. This would open up huge opportunities for innovative new firms in areas like renewable energy, low-carbon transport and sustainable forestry management. However, it also imposes enormous challenges for established firms .

One can foresee other obstacles.  If there is to be a new green industrial revolution, novel, credible, strong and persistent policies will have to be implemented around the world.  Although modern economies depend heavily on energy, the energy sector itself may not be big enough to  trigger the same economy-wide transformation and wave of innovation as earlier economic revolutions, such as that in IT.

Fourth, green growth recognises the constraint that increasingly scarce resources may impose on growth in the very long run.  So far, human ingenuity and good governance have allowed humanity to escape the fate foretold by the Club of Rome and many others – that the world is running out of essential resources.  Economies have managed to generate new products and production techniques before resource constraints have begun to bite.  The challenge is for ‘green growth’ policies to repeat this feat, by replacing exhaustible resources like fossil fuels with renewable ones like solar energy.

How will all this affect economic policy?  Green growth requires both public policy and private initiative. It will be private entrepreneurs that start the new industrial revolution. But they need to be incentivised through well-designed – though not necessarily more – regulation.  Policies need to be applied within transparent, credible and ethically acceptable frameworks of governance, monitored and assessed by informed citizens. Perhaps most importantly, green growth  reinforces the need for collective action. The green industrial revolution will only happen if enough people decide this is the way to go.

Alex Bowen is principal research fellow at the Grantham Research Institute on Climate Change and the Environment at London School of Economics and Political Science. Sam Fankhauser is co-director of the Grantham Research Institute on Climate Change and the Environment and a member of the UK Committee on Climate Change, an independent body that advises the UK Government on carbon targets and on preparing for climate change.

The blog above is based on a technical article for Global Environmental Change.

Confused about costs of nuclear v. renewables? Read on!

August 9, 2011 in Alice Barrs, Electricity market reform, Nuclear, Offshore wind, renewable energy by Committee on Climate Change | No comments

There has been a debate going on in the blogosphere lately over the relative cost of nuclear and renewables, citing analysis we produced for Government in our Renewable Energy Review.
Alice Barrs, a lead economist on the review, delves into some of the finer detail of our work, to explain what we actually said, and more importantly, why…………

On entering office, Secretary of State Chris Huhne asked our Committee to conduct a Review into Renewable Energy to provide advice on whether the renewables target for 2020 should be raised; and on the potential for renewable energy development beyond 2020 to 2030.

The need for a portfolio approach

In May 2011, we published the review, the headline recommendation of which was that renewable energy could make a major contribution to decarbonising the UK economy, providing between 30-45% of our energy by 2030, compared to around 3% today (see Figure 5.2 below). [AB1]

[AB1] Figure 5.2: Renewable energy and overall gross final consumption in 2009, 2020 and illustrative scenarios for 2030
Source: CCC Renewables Review – May 2009

Based on an assessment of costs, resource constraints and technical considerations, we argued that in determining the precise balance of renewables versus other low carbon technologies in the power sector, a portfolio approach to technology development is appropriate.

Specifically, we proposed that there should be investment in various renewable forms of power generation over the next two decades, together with nuclear and CCS.

Nuclear, renewables and CCS are potentially cost competitive

Our cost assessment was based on new research and modelling by Mott Macdonald which built on a study they produced for DECC in 2010 and developed cost scenarios across the range of low carbon technologies.

The Mott Macdonald analysis showed that there is a wide range of potential costs for each of the low carbon technologies (e.g. 7.5-13.5p/kWh for offshore wind, and 4-10p/kWh for nuclear in 2030). This reflects uncertainty around key cost drivers, including construction and financing cost, and learning rates, (see Figures 1 & 2 below).

Source: CCC Renewables Review – Executive Summary

In the case of nuclear in particular, we modelled a range of construction costs that builds in experience from the two projects currently under construction in Finland and France, financing costs based on a review of the literature and a survey of market participants, and back end costs estimated using social rather than (higher) commercial discount rates.

In future, it will be important to learn lessons from the Fukishima incident, including any implications for costs (e.g. associated with design changes or increased financing costs).

Given the significant uncertainties, it is difficult to be definitive about the relative costs of low carbon technologies, particularly further out in time.

However, we concluded that it is likely that nuclear will be relatively cheap for the foreseeable future. In the longer term, there are plausible scenarios where the full range of low carbon technologies – nuclear, wind, marine, solar, CCS – are competitive.

The role of nuclear and renewables in achieving power sector decarbonisation and carbon budgets

Parliament recently legislated a fourth carbon budget which reflects almost full decarbonisation of the power sector over the next two decades (e.g. reducing average emissions from around 500 gCO2 / kWH to less than 50 gCO2 / kWh by 2030) .

In the Renewable Energy Review, we set out an illustrative scenario to achieve required decarbonisation, in which nuclear and renewables account for 40% of generation in 2030, with CCS contributing 15%, and 5% unabated gas fired generation.

We stressed that this should not be seen as a target, and recommended that the precise balance between technologies should be determined through new electricity market arrangements, based on consideration of relative costs and other factors.

However, it is clear that achieving sector decarbonisation will require significant investment in nuclear, wind and CCS. Trying to decarbonise without one or more of these options would raise costs and risks of meeting the carbon budget to which we are now legally committed. For example, taking nuclear out of the mix would result in increased investment in unabated gas fired generation and associated emissions above budgeted levels.

Therefore it will be important to ensure that new electricity market arrangements support investment in nuclear where this is cost effective, and provide additional support for less mature technologies such as offshore wind and CCS for a transitional period until these become competitive.

Given this approach, we will be well placed to achieve early power sector decarbonisation, which is a central pillar of wider economy decarbonisation required under the Climate Change Act.

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