A new multi-client study from Hawkins Wright - available in APRIL 2010
A strategic assessent of UK investments in biomass power
The commercial implications for biomass buyers and suppliers
BACKGROUND TO THE REPORT
The United Kingdom’s renewable energy targets are more ambitious than those of any other country in Europe. The UK government is committed to increasing the renewable energy share of the country’s final energy demand to 15% by 2020, from just 2% in 2007.
One implication is that by 2020 renewables (excluding nuclear) must account for around 30% of the UK’s total electricity generation, up from just 5.5% today. Most of this new electricity is expected to come from more onshore and offshore wind, but the government’s energy strategy expects biomass to contribute about a fifth of the UK’s renewable electricity demand by the end of the next decade.
To date, utilities and project developers are planning the construction of more than twenty large (>50MWe) biomass power plants in the UK, some due come on stream from 2012. These will have a combined generating capacity of >3.8 GWe and represent a capital investment estimated at around £8 billion (€9 billion). There is also a host of smaller (<50 MWe) biomass power and CHP projects.
THE CHALLENGES
The annual feedstock requirement of the 20+ large biomass power plants that are being planned in the UK amounts to >300 million GJ (>83 million MWh).
Three hundred million GJ amounts to 17 million tonnes of wood pellets or 30 million tonnes of green wood chips, more than is currently imported by Japan’s pulp and paper industry, which for years has been by far the world’s biggest wood chip market.
Not all of the feedstock will be in the form of wood and not all of it will be imported: energy crops, waste wood and non-wood biomass, will play a role. More wood will be sourced from British forests too.
Nevertheless, most of the new plants are designed primarily to use wood chips or pellets and they are located on the coast specifically to receive imports.
Securing a sustainable source of biomass feedstock presents challenges for the electricity generators and for the whole biomass supply chain.
THE SCOPE OF THE REPORT
- The report will be a high-level strategic assessment of the commercial implications of the UK’s planned investments in biomass power.
- The main focus will be on the feedstock implications of these investments, but wider issues such as developments in the UK electricity market and the outlook for UK/EU energy and environmental policy drivers will be examined. The operation of the UK’s support mechanisms and the benefits that will accrue to renewable power producers will be explained.
- The report will profile each biomass power project and will assess its likely feedstock requirements.
- The report will analyse the availability of solid biomass feedstock in the UK – including woody biomass, straw and other agricultural waste etc. – and will present forecasts of the UK’s demand for imported biomass, including separate forecasts for wood chips and wood pellets and other forms of biomass feedstock.
- The availability of biomass in likely supply regions worldwide will be assessed and factors that will influence trade flows will be examined, including phytosanitary regulations, logistic infrastructure, the competitive advantages/disadvantages of alternative end-uses etc.
HOW TO SUBSCRIBE
A subscription to ‘A Strategic Assessment of UK Investments in Biomass Power’ costs £3,500 (or the equivalent in euro or US dollars). Subscribers to Forest Energy Monitor qualify for a discounted price of £3,200.
Orders received and paid for by 31 January 2010 will qualify for a further £300 discount: i.e. £3,200 (or £2,900 for FEM subscribers.)
A subscription includes a printed copy of the report, a PDF copy and a presentation meeting.
To subscribe, please download and return the order form, or contact us for more information.
OUTLINE TABLE OF CONTENTS
- The UK electricity market and the factors driving the government’s renewable energy policies
- The operation and value of policy instruments (e.g. Renewable Obligation Certificates - ROCs) used to promote the development of renewable electricity generation. The value of these instruments to a biomass power producer
- Profiles of 20+ biomass electricity projects in the UK, including both dedicated-biomass and cofiring projects. The capacity of each project and its technical, planning and financial status. Each project’s estimated annual feedstock requirement and its likely feedstock preferences/flexibility. Port and transport infrastructure. Contact information for executives responsible for feedstock purchasing.
- Forecasts of biomass feedstock demand in the UK to 2020, taking into account also the availability of biomass feedstock from UK sources and the requirements for heat and smaller (<50MW) power/CHP uses etc. Forecasts of the import demand for woody biomass, distinguishing between wood chips and wood pellets.
- Feedstock sourcing strategies. Indications of biomass availability in the principal potential supply regions – Europe, Canada, USA, Latin America, Africa, Australia/NZ and Asia. The indicative structure of long term supply contracts. Potential constraints on trade: e.g. phytosanitary regulations, logistic/shipping infrastructure etc.
- Constraints and risks for investors and biomass suppliers: planning policy; environmental policy, including sustainability criteria and forest certification; feedstock supply risk; technical/operational risk; political risk etc.
- Executive summary and conclusions
WHO IS THIS REPORT FOR?
This report is intended for everyone who requires an objective independent assessment of the many investments in biomass power that are being proposed in the United Kingdom. This includes electricity utilities and project developers, forest owners, wood pellet manufacturers, shipping companies and port operators, biomass trading companies, financial institutions, equipment suppliers, government departments and agencies, and environmental NGOs.