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Wood Panel Sector Helps Launch European `Wood Action Day`

Tue, 27 Mar 2012 00:00:00 GMT

A conference will be held this evening (27 March) in Brussels to mark the launch of a ‘Wood Action Day’ in the European Parliament. The conference has been jointly sponsored by the European Panel Federation and the European Organisation of the Sawmill Industry.

The conference will include a discussion of how to make Europe greener through the use of wood. This will include a focus on the importance of using wood in construction in order to make full use of its carbon storage properties. The conference will also highlight industry concerns about the impact of biomass subsidies on the wood panel sector and the need for change in this area.

To coincide with the event politicians across Europe will receive wooden gifts to demonstrate the value of processing wood into products that can store carbon instead of burning it for energy generation.

Wood and wood-based products support more than 2 million jobs and contribute almost €2 billion to European economies every year. Using just 4% more wood in this way would sequester an additional 150 million tonnes of CO2 each year, reducing Europe’s overall emissions.

Biomass plants currently burn virgin and waste timber before it comes to the end of its useable life, which undermines the waste hierarchy. In order to maximise the carbon storage and economic potential of this valuable resource, wood should only be burnt for energy at the end of its useable life.

Alastair Kerr of the Wood Panel Industries Federation said:

"It’s important that as many people as possible are made aware of the benefits of wood in the economy and from an environmental point of view."

"In addition to the economic arguments we have also calculated that CO2 emissions could actually increase by six million tonnes each year if the government continues to put resources into biomass power stations, effectively cancelling out any environmental benefits into the bargain."

"Carbon storage in harvested wood products extends the carbon sequestration benefits provided by forests. Their role in mitigating climate change has been now been recognised in the recent European Commission Proposal for a Decision on ‘accounting rules and action plans on greenhouse gas emissions and removals resulting from activities related to land use, land use change and forestry’.[1] The European Institutions and National Governments are now requested to adopt the European Commission Proposal and to take appropriate measures in order to fully implement the Decision."

[1] http://ec.europa.eu/commission_2010-2014/hedegaard/headlines/docs/com_2012_93_en.pdf

Public not being told about threat to UK forests from big energy

Wed, 17 Aug 2011 00:00:00 GMT

An industry group whose members are themselves under threat from subsidies paid to ‘big energy’ under the Government’s Renewable Energy Policy, are concerned that the public are not being told the full story behind the policy that in reality rewards electricity generators to burn UK forests.

Alistair Kerr, Director General of the Wood Panel Industries Federation said, “We saw how much the British public value our forests when the Government tried to sell them off. Now instead, the public themselves are paying through their energy bills for companies to take wood direct from UK forests and turn it into woody biomass, burning it to fuel electricity generators.

Currently, there are 58 wood burning biomass plants either in existence, granted planning permission or awaiting approval across the whole of the UK. Of these, 35 have a capacity of up to 50MW . It is these that even the Government has admitted will look towards UK forests for their wood.¹

The total demand from these ‘lower capacity’ power stations will be 7.2 million tonnes of wood a year. The UK only produces between 10-11 million tonnes of wood annually.

Much of that is already consumed by UK manufacturers, such as the wood panels industry, to produce everyday items that are used in , building and construction, furniture and other associated industries. These manufacturers will find themselves priced out of the UK wood market thanks to the extra buying power of subsidies given to electricity generators.

The other 23 woody biomass burning plants existing, approved or proposed, will work at capacities of between 50 and 750Mw. These will require over 43.5 million tonnes of wood each year to operate.

One of them, RWE NPower’s Port of Tilbury plant will need 7.5 million tonnes alone, and only this week, the Government consented to planning permission for energy giant Drax, to build two new wood burning power plants that will require 6 million tonnes of wood.

Wood from forests across the world will have to be shipped to the UK and then burnt. However, the UK is not the only country doing this...there are woody biomass plants being built and planned across the world and they will all want wood from our forests.

When wood is used properly, it retains carbon for the length of its lifetime which in construction can be in excess of 60 years. This period can be extended by a further 30 to 40 years by reusing and recycling which is already common practice by the wood panel industry.

Using woody biomass to produce electricity will immediately release stored carbon into the atmosphere. Far from producing ‘renewable energy’, it will take many years before any new trees planted to replace the burned wood are able to store the equivalent amount of carbon.

Alistair Kerr concluded, “The government has failed to disclose to the public that generators like Drax, E.ON, RWE NPower and Scottish and Southern Energy will use the subsidy paid by taxpayers to source as much wood as they can from the UK before venturing further afield.

“If allowed to continue unchecked, not only are the UK’s wood processing industries at serious risk of being wiped out thereby putting at risk tens of thousands of jobs, but the forests that the British public care deeply about will be decimated – and it is the public that will have paid for it to happen.”

1.DECC Review of the Generation costs and deployment potential of renewable electricity technologies in the UK, June 2011 (Section 10.4.2 Dedicated biomass (Solid), page 111) http://www.decc.gov.uk/assets/decc/What%20we%20do/UK%20energy%20supply/Energy%20mix/Renewable%20energy/policy/renew_obs/1834-review-costs-potential-renewable-tech.pdf

Wood Panel Industry condemns Government support for Drax wood-burning plant

Thu, 11 Aug 2011 00:00:00 GMT

Energy Minister Charles Hendry MP has approved two vast new wood burning power plants. The two plants, owned by Drax, will be located in Selby, Yorkshire and South Killinghome, North Lincolnshire.

These two plants see Drax being paid millions of pounds in subsidies, via the Renewables Obligation (RO) to burn nearly 6 million tonnes of wood a year – over half the UK’s annual wood harvest.

The Government recently forecast biomass would produce 8000MW of UK energy by 2030 – requiring some 80 million tonnes of wood. The vast quantities of wood required to meet this target cannot be produced in the UK, meaning wood from across the world will be shipped to the UK and burnt.

The Renewables Obligation was designed to support renewable energy technologies and reduce carbon emissions. The policy is now leading to timber being burnt rather than used in manufacturing, leading to a rise in carbon emissions.

Alastair Kerr, Director-General of the Wood Panel Industries Federation, has condemned the Government’s decision to grant planning permission to Drax’s plants: “We are extreamly concerned about the impact this will have on domestic wood availability. The government fails to understand that generators like Drax will use the subsidy paid by taxpayers to source as much wood as they can from the UK before venturing further afield. If allowed to continue unchecked, the UK’s wood processing industries are at serious risk of being wiped out thereby putting at risk tens of thousands of jobs. Most of the UK’s wood supply is already being utilised by the wood processing sector that actually make wood work by producing products that continue to store carbon.”

As a result of subsidy, average wood prices have risen by nearly 60% in the past five years.

“Large-scale electricity plants burning wood plants should not be being subsidised by the UK taxpayers – who also face paying more for their energy and wood products. Granting planning permission to these plants is short term approach to energy supply, and will cause long-term damage to the environment and existing valuable industries”.

WPIF Director-General Letter to The Times

Fri, 5 Aug 2011 00:00:00 GMT

Sir

Coal Giant demands more incentive to burn wood pellets, straw and waste: Tim Webb, Times, Wednesday 3 August

What Drax and others are really asking for is more money to build more power plants to burn trees from forests in the UK and abroad.

While Drax may call it ‘biomass’ and include straw and waste, with insufficient take up of energy crops in the UK and abroad and strict controls on what waste can be burned, what they will be using is, in reality, ‘woody biomass’ - which is the most carbon intense, inefficient and expensive method of producing electricity.

Trees store carbon over years of growth and continue to store it throughout the life of the wood regardless of what products are produced from it. Burn it, and you immediately release the stored carbon, whilst replanting a replacement will take 30 to 40 years to grow before it stores an equivalent quantity.

The total demand for woody biomass if the Drax, E.ON, SSE and other 60 or so planned ‘biomass’ plants were to come online would be around 50 million green tonnes of wood per year. This would create only 0.5% of the total energy required for UK use, whilst producing electricity that is only 30% efficient, as well as increasing not decreasing our carbon emissions.

Most of the UK wood supply is already being utilised by the sawmilling, wood panel and other associated industries that actually make wood work the way it should by producing products that continue to store carbon.

Drax, having used subsidies to buy what little remains of the UK wood basket will use them to cover the cost of importing woody biomass from abroad which is of no benefit financially to the UK and will only further add to our carbon emissions.

If Dorothy Thompson and John Constable’s wishes came true, the UK consumer will be paying increased prices for energy and for wood products, whilst funding electricity generation that is neither ‘green’ nor efficient.

Yours faithfully

Alastair Kerr

Director General

Wood Panel Industries Federation

Rt Hon Anne McGuire MP explains wood panel industry`s concerns

Thu, 7 Jul 2011 00:00:00 GMT

In an interview with website ePolitix, the Chair of the Wood Panel Industry APPG, Rt Hon Anne McGuire MP details the threat to wood panel manufacturing in Britain posed by biomass subsidies.

The wood panel industry provides vital employment in rural communities and is the biggest recycler of wood in the country. The Norbord plant in Anne's Stirling constituency alone provides 250 jobs, without counting those employed at other points along the supply chain.

However, these jobs face an uncertain future, as subsidies for generating electricity using biomass are distorting the domestic wood market. Energy companies, supported by the Renewables Obligation (RO), are using their enhanced purchasing power to bid for the same wood used by the wood panel industry. If the situation does not change, explains Anne, the future of the wood panel industry and wood-based manufacturing in Britain will be threatened.

In response, Anne has supported the 'Make Wood Work' campaign in Westminster, tabled an Early Day Motion in support of the wood panel industry and a Westminster Hall debate. Some progress has been made but the Wood Panel Industry APPG will continue to make the industry's concerns known to DECC.

You can read Anne's interview in full here:

http://www.epolitix.com/latestnews/article-detail/newsarticle/making-wood-work/

Annual General Meeting of the Wood Panel Industry APPG

Wed, 29 Jun 2011 00:00:00 GMT

The AGM of the All-Party Parliamentary Group for the Wood Panel Industry will take place on Tuesday 5th July at 3pm.

The Rt Hon Anne McGuire MP (Chair) will oversee proceedings and the election of Officers will be confirmed.

The Group will discuss their progress in obtaining recognition of the industry's renewable heat contribution towards Britain's renewable energy targets. Anne McGuire will report on the meeting with Greg Barker MP, Minister for Climate Change, and his indication that the department would consider including direct heating in the regulations for the Renewable Heat Incentive (RHI).

The AGM will be followed by a discussion of the meeting with Greg Barker and meeting with the Renewables Obligation (RO) team at DECC. Members of the Wood Panel Industries Federation will also provide an update on the Make Wood Work campaign.

Renewable Energy Subsidies affecting viability of Furniture Manufacturing

Wed, 1 Jun 2011 00:00:00 GMT

During May, key industry leaders joined together at a Biomass Summit hosted by The Furniture Industry Research Association (FIRA) to discuss the impact of Government renewable energy subsidies. The event was attended by Alastair Kerr, Director General of the Wood Panel Industries Federation (WPIF) along with other industry and trade association representatives.

The event was organised to allow key industry leaders to discuss how government renewable energy subsidies, which encourage power companies to burn wood, are distorting the market for new timber, and forcing up the costs for the manufacturing of furniture products.

It is estimated that these subsidies are artificially raising the costs for furniture manufacturers by as much as 50%, a cost increase which ultimately leads to higher prices for consumers.

Industry leaders and representatives who attended the event included British Retail Consortium (BRC), British Furniture Manufacturers (BFM) association, British Contract Furniture Association (BCFA), and the British Furniture Confederation (BFC) as well as furniture manufacturer Senator International, retail giant Home Retail Group (parent to Argos and Homebase), The Decorative Panels Group and also representatives from manufacturer of wood based panels, Egger.

Jonny Westbrooke, FIRA COO said, "The burning of virgin wood is hitting the furniture industry hard, and is leading to increased costs in a delicate economic climate. The Biomass Summit bought together industry leaders to discuss how we can restore the balance in timber pricing [...] It has been a fantastic achievement to get so many key players around the table to discuss an issue which affects the furniture industry at all levels."

Current subsidies granted to energy companies for burning wood create a distortion in the wood market and risk raising the price of timber to a level at which wood panel manufacturers would not be able to compete. The Wood Panel Industries Federation (WPIF) is calling on the Government to reconsider the prominent role it has accorded to biomass in meeting renewable energy targets and particularly the financial incentive provided to electricity generators to burn wood under the Renewables Obligation (RO).

The summit agreed that there is a shared concern that needs to be communicated clearly to Government. Members have committed themselves to continue to work together to communicate this message.

Radio 4 explores the implications of the RO

Thu, 12 May 2011 00:00:00 GMT

Reporter Sharmini Selvarajah speaks to furniture manfacturers, wood panel manufacturers, the Rt Hon Anne McGuire and Greg Barker (Minister of State for Energy and Climate Change) about the Renewables Obligation and its impact on the price of wood.

You can listen to the programme by clicking on the link below:

You and Yours Programme, 12 May 2011

Support the Wood Panel Industry by urging your MP to sign Early Day Motion 1788

Wed, 11 May 2011 00:00:00 GMT

The Rt Hon Anne McGuire, Chair of the wood panel industry All-Party Parliamentary Group, has tabled an Early Day Motion (EDM) which highlights the strengths of the wood panel industry, the danger posed to it by large-scale biomass and calls on the Government to rethink the way it supports biomass energy. The EDM is already attracting cross-party support and further details can be viewed on the parliament UK website: http://www.parliament.uk/edm/2010-11/1788

EDM 1788 which is called Make Wood Work, reads:

That this House recognises the important contribution of the wood manufacturing sector to the UK economy; is alarmed by the inefficiency of burning wood to generate electricity alone; doubts the sustainability and environmental benefits of large-scale biomass energy; is greatly alarmed that a single biomass plant could consume a quarter of the UK's annual wood harvest; is concerned that the Renewables Obligation is distorting the domestic wood market; supports the wood panel industry's campaign, Make Wood Work, to promote the optimal use of a valuable and limited resource; notes that the wood panel industry contributes over a third of industrial renewable heat generation and is the largest processor of waste wood; further recognises the vital contribution of wood products in storing carbon; and calls on the Government to move biomass support from low-efficiency electricity generation to high-efficiency heat and combined heat and power.

You too can support the wood panel industry by downloading the letter and sending it to your MP, asking them to sign EDM 1788.

Why is the UK backing biomass power?

Thu, 5 May 2011 00:00:00 GMT

A comment on the Guardian Environmental Blog from 5th May

http://www.guardian.co.uk/environment/blog/2011/may/05/biomass-power-costly-climate-solution

The Guardian’s Environment Blog has recently asked a crucial question: “Why is the UK backing biomass power?” Production editor Lewis Williamson covered the growth in local groups campaigning against large-scale biomass plant developments and the widespread criticism of biomass’ environmental credentials.

Williamson cites concerns over the scale of these plants and the enormous demand it creates, chiefly for wood. The Government appears to forget that there are existing UK buyers for this wood, and that these crucial existing uses will be displaced by such huge and subsidised demand. Indeed the recent report for the Department of Energy and Climate Change (DECC), UK and Global Bioenergy Resource, seems to dismiss competing uses and even suggests that material will flow to energy, provided the price is right.[1]

The comments on waste from DECC are nothing short of misleading. WRAP recently halved its estimate of total waste wood arisings to between 4 and 4.5m tonnes per annum – around half of this is already productively recycled into wood products and animal bedding. This leaves at most 2.5m tonnes that could be used for energy, subject to extremely stringent and expensive waste incineration regulations, not to mention the public’s deep-seated mistrust of burning waste.

DECC’s approach to biomass supply and demand and the potential for damage to wood processors is encapsulated in the UK’s National Renewable Energy Action Plan, recently submitted to the European Commission:

“We estimate that the global availability of biomass, taking into account sustainability constraints, is potentially some 5,500 [Terawatt hours] (TWh) per year by 2020. These calculations are based on the assumption that the wood products, paper and panel industries would be supplied first.”[1]

How could that work in a market where energy generators, subsidised by the RO, can pay more than the wood products, paper and panel industries? Is the Government proposing to provide these sectors with preferential long-term contracts?

It is also hugely misleading to talk of supporting 50-60m tonnes of biomass demand with assorted waste streams. There is a good reason why energy companies have focused on wood – it makes them the most money. According to Ofgem, wood and wood wastes currently comprise 54% of biomass burned for electricity generation.

Although the UK simply cannot support a demand for 50m+ tonnes of wood, it is undeniable that energy companies will source as much of the UK’s wood harvest as possible, because the costs of importation are so high. It is clear from data used by DECC’s advisers that there is an expectation that wood prices will rise to at least £82 per green tonne. What more evidence does government need that wood processors and users are going to be severely impacted?

Therefore, this begs the question – what is the best use of wood? The Government’s “sustainability criteria” are a joke. They don’t appear to measure sustainability at all. By comparing greenhouse gas emissions of wood-fired electricity generation with that of fossil fuels, you are weighing up an inefficient and highly carbon emitting process with an even dirtier one. What the Government needs to do is assess the best environmental outcome of wood itself. Electricity generation compares extremely poorly with both wood processing (locking carbon up into products) and with small-scale heat generation, which is around three times as efficient.

The Guardian’s initial question of why the UK is supporting biomass is an excellent one. No other EU state is providing such generous subsidies to large-scale electricity generation from wood. Germany and Austria, which are decades ahead of the UK in renewable energy, insist on high-efficiency processes such as combined heat and power (CHP) or useful heat generation.

So why is the UK doing this? Of course, energy consumption is still rising in the UK and much of the new biomass capacity will add to existing fossil fuel capacity, not replace it. Beyond this, the UK Government’s support for biomass can be attributed to three main factors: desperation to reach ambitious renewable energy targets, whatever the true carbon emission outcome; a fundamental lack of knowledge of wood uses and the wood markets; and a cavalier attitude to existing wood users and their contribution to environmental outcomes – not to mention the jobs and tax revenues provided to mainly rural areas. It is time that the UK Government assessed its support for biomass to prioritise the best use of this limited and highly valuable material.

[1] http://decc.gov.uk/assets/decc/What%20we%20do/UK%20energy%20supply/Energy%20mix/Renewable%20energy/policy/1464-aea-2010-uk-and-global-bioenergy-report.pdf

[1] http://www.decc.gov.uk/assets/decc/what%20we%20do/uk%20energy%20supply/energy%20mix/renewable%20energy/ored/25-nat-ren-energy-action-plan.pdf , p. 138

Tilbury power station may become 650 MW biomass plant

Wed, 27 Apr 2011 00:00:00 GMT

Tilbury power station, currently due to close by 2015 under European laws, may be granted a new lease of life as a biomass plant.

The 1,000 megawatt power station on the banks of the Thames has been approved for conversion by RWE npower to burn wood pellets instead of coal to a capacity of 650 megawatts. If Europe grants exemption, Tilbury would become the largest biomass plant in the world.

Biofuelwatch, a volunteer-led organisation that examines the effects of increasing bioenergy demand, estimates that such a move would push the UK's total planned demand for biomass to around 60 million tonnes of wood per year. At the moment, the Forestry Commission estimates that only an additional 2 million tonnes of wood could be produced from within the UK by 2020. The simplicity of the figures speak for themselves: there is a massive shortfall between supply and impending demand for wood in the UK.

Of course, RWE npower recognises that much of its wood pellet demand will have to be met by wood imports. Specifically, it plans to ship the majority of its fuel needs from a RWE wood pellet plant in Georgia, USA.

Furthermore, RWE believes it will be just as cheap for the plant to burn wood pellets as coal, and well may it do so, considering Government subsidies for renewables and taxes on fossil-fuel plants. However, such proposals can have no credible environmental or sustainable business case, when you take into consideration the carbon emissions released from burning wood to generate 650 megawatts and the environmental impact of shipping huge volumes of wood. The sheer quantities of wood required cannot be met by current global wood supply without endangering the forests of the Southern hemisphere. Burning wood for energy on such a massive scale is ill-conceived and such plans require considerable more thought.

The Wood Panel Industries Federation (WPIF) is calling on the Government to reconsider the prominent role it has accorded to biomass in meeting renewable energy targets and particularly the financial incentive provided under the Renewables Obligation (RO).

Current subsidies granted to energy companies for burning wood create a distortion in the wood market and raise the price of timber to a price at which wood panel manufacturers cannot compete. Should plans continue in their current form, wood panel manufacturing will be forced to leave the UK, taking with it jobs, a means of locking carbon in high-quality wood products and a renewable heat contribution of 1639 GWh per year (which in 2009, represented 36% of the total output from UK industry). This is in addition to the role the industry plays in processing recovered wood, which each year amounts to around 1.1million tonnes or roughly a quarter of their raw wood material needs.

Large scale electricity-only biomass does considerable environmental damage and threatens to displace an important UK industry. Despite this, the current situation seems to indicate that the Government is willing to sacrifice wood panel manufacturing on the altar of renewable energy targets in its mistaken belief that biomass energy is 'green'.

Another campaigner, Helena Paul from Econexus adds: “We need immediate emission reductions to avoid runaway climate instability. Large-scale biomass burning makes no sense because it involves releasing more greenhouse gases per unit of energy than coal during the next few critical years, even if this is (in theory) made up by new growth later. This dangerous emissions debt alone should halt developments worldwide such as Tilbury.”

RWE hopes to have completed the conversion by the end of the year and while burning biomass does not automatically save Tilbury from scheduled closure, RWE is expected to apply to Europe for an exemption if this year's trials at the station are successful.

The original article from the Telegraph can be viewed here: http://www.telegraph.co.uk/finance/newsbysector/energy/8470091/Wood-burning-may-bring-reprieve-for-Tilbury-Power-Station.html

Neil Parish MP visits Norbord plant in South Molton

Fri, 15 Apr 2011 00:00:00 GMT

Tiverton and Honiton MP Neil Parish has been told that the UK government's flagship green policies could cost hundreds of manufacturing jobs in Devon, waste billions of pounds - and, perversely, increase CO2 emissions.

Mr Parish heard concerns about the effects of the renewable heat incentive (RHI) and the renewables obligation (RO) on the wood panel industry during a visit to South Molton wood panel manufacturer Norbord on 15 April.

The UK government launched the RHI last month as part of its strategy to revolutionise the way heat is generated and used in the UK. Believed to be the first of its kind in the world, the policy aims to support emerging technologies and businesses in the UK as well as strengthening security of supply and reducing dependence on fossil fuel heating and emissions.

The development of sustainable low carbon energy alternatives has lead to a proliferation in large-scale biomass generators, where energy providers are being given financial incentives in the shape of Renewable Obligation Certificates (ROCs) to burn large masses of crops and wood.

Wood panels, a vital component in the construction industry and in furniture manufacture, are produced from virgin and reclaimed wood - the same materials which biomass energy plants are being subsidised to burn. However, the wood panel industry has been excluded from the policies and this could have a dire effect on local manufacturer Norbord, which employs 400 people at its plant in South Molton, Devon, including a number in Mr Parish's constituency. The company also employs 250 people in Cowie, Stirlingshire, and a further 120 at its site in Morayhill, near Inverness.

Mr Parish said: "The failure even to consider the wood panel industry for inclusion in the RHI is a clear omission and is deeply concerning for me. There must be a hierarchy of use for wood, where it is used, re-used, recycled and, then only when it has reached the end of its useful life, burned. The wood panel industry is a model industry for this hierarchy, making it one of the greenest sectors around.

"It is clearly ridiculous that energy companies are being subsidised to burn wood and thereby release carbon into the atmosphere when this carbon could be locked in the production of wood panels. If nothing is done, wood prices could potentially rise to a point where they meet that paid by generators for imported material. This will put thousands of jobs in the UK wood panel and associated industries at risk and has the potential to escalate costs for the construction and furniture industries.

"I will be urgently writing to Greg Barker- the Minister responsible- to prevent this situation arising."

Karl Morris, MD of Norbord, said: "Despite significant communication and dialogue with Norbord, our industry representative body the Wood Panel Industries Federation (WPIF), and the Wood Panel All-Party Parliamentary Group, the Minister of State for Climate Change, Greg Barker, and his department have failed either to appreciate or consider the unintended consequences of the legislation.

"Indeed, Mr Barker accepted in a recent Westminster Hall Debate that the wood panel industry had not been considered within the scope of the RHI Impact Assessment. Further, he quoted figures in the Debate which demonstrate a profound failure of understanding of the issues involved.

"This failure even to consider the wood panel industry, and the use of inappropriate and inexact data, is profoundly concerning both to Norbord and our constituents. The most basic analysis could demonstrate that the impact on the wood panel industry - and a significant number of Mr Parish's constituents - will be potentially devastating.

"Further discrimination would make the closure of wood panel plants in the UK, including Norbord's facilities in South Molton and the two in Scotland, a real possibility. This is clearly an unacceptable state of affairs for a sector which produces nearly £100m of tax revenues, £1bn of economic activity and supports 8,700 jobs, many of them in North Devon.

"It may well be that the Department of Energy and Climate Change (DECC) is willing to sacrifice the wood panel industry on the altar of the Climate Change agenda. And, although Mr Barker claimed several times in the Westminster Hall Debate that is not the case, the DECC's actions seem significantly at variance with these protestations.

"To do so would be profoundly misguided, not just as considered by the wood panel industry which rightly has its own interests to protect, but even when considered in terms of the ambition of that Climate Change agenda for which Mr Barker is responsible. With the demand for wood now outstripping supply, a recent study by the United Nations found that there could be a shortage of up to 400million m ³ of wood in Europe by 2020 due to the demands of biomass.

DECC estimates that the demand for wood for energy under the RO and RHI targets will reach 50million tonnes. This is against a UK supply of 12million tonnes, according to DECC estimates. Demand is now outstripping supply and cost of the raw wood materials used by the wood panel industry and the biomass producers has rocketed by 60% in the past three years.

However the wood panel industry does not benefit from the enhanced buying power enjoyed by the energy producers through the RO subsidy. Despite continued lobbying by the WPIF and a recent European-wide potest against the directive, the industry's concerns have yet to be considered by the country's energy policy makers.

The growing concerns was further confirmed recently when it was announced that the RHI's Impact Assessment did not cover any potential impact on the wood industries. The exlusion comes after the WPIF submitted extensive supporting evidence to DECC.

"The introduction of the RHI is to be welcomed, but to exclude the pioneer of this technology and the larget generator of renewable heat makes no sense. The current direction of travel that the DECC is embarked upon will lead inevitably to the utterly perverse outcome of perfectly usable wood being directed, through a distoring and ill judged subsidy, to an increase in CO2 emissions, reduction in renewable heat generation, and reduction in employment.

"We have asked many times that DECC considers rebalancing this equation through the RO and, particularly, the RHI funding mechanisms. In particular, it seems both unreasonable and unfair that, as the UK's single largest industrial generator of renewable heat, we should be excluded from the RHI process. To be "punished" as an early adopted, and for competitive advantage to be given to new entrants, is economic and environmental madness.

"Although we have received backing by MPs and a wide range of other organisations and individuals, it's vital that political decision makers now begin to listen seriously to our calls for more responsible use of wood and to create a level playing between ourselves and our competitiors across the energy sector."

Fighting back against flawed wood subsidies

Mon, 11 Apr 2011 00:00:00 GMT

Writing for nebusiness.co.uk on 8 April 2011, Egger's Bob Livesey puts forward his views about the unintended consequences of Government subsidies on the wood market.

You can read his article in full here:

http://www.nebusiness.co.uk/business-news/construction-in-north-east/2011/04/08/fighting-back-against-flawed-wood-subsidies-51140-28480116/

Alex Salmond visits Norbord plant at Inverness

Thu, 7 Apr 2011 00:00:00 GMT

On 4th April 2011, the Scottish First Minister, Alex Salmond, took time to visit Norbord's plant near Inverness airport ahead of the Scottish General Election on 5th May.

On the visit he was accompanied by Fergus Ewing, the SNP candidate for the Scottish Parliamentary elections for the consitutency of Inverness and Nairn.

The visit gave Mr Salmond the opportunity to see at first hand the investment that Norbord have made both in terms of capital assests and in training for the workforce. It was also a chance for company officials to discuss with the politicians present what impact the Renewables Obligation and the UK's focus on biomass as a renewable fuel are having on established wood panel processing companies such as Norbord.

Iain Gray visits the Norbord plant at Cowie

Thu, 7 Apr 2011 00:00:00 GMT

Scottish Labour leader Iain Gray has been told that the UK government's flagship green policies could cost hundreds of Scottish manufacturing jobs, waste billions of pounds - and, perversely, increase CO2 emmisions. Mr Gray heard concerns about the effects of the renewable heat incentive (RHI) and renewables obligation (RO) on the wood panel industry during a visit to Stirlingshire wood panel manufacturer Norbord on 1st April.

Wood panels, a vital component in the construction industry and in furniture manufacture, are produced from virgin and reclaimed wood - the same materials which biomass energy plants are being subsidised to burn. However, the wood panel industry has been excluded from the policies and this could have a dire effect on local manufacturer Norbord, which employs 250 people at its plant in Cowie, Stirlingshire. The company also employs 400 people in South Molton in Devon.

The company already has the support from Stirling MP Anne McGuire and she attended the breifing along with Mr Gray and Labour's Holyrood candidate for Stirling, John Hendry.

Karl Morris, MD of Norbord, said: "Despite significat communication and dialogue with Norbord, their industry representative body the Wood Panel Industries Federation (WPIF), and the Wood Panel APPG, the Minister and his department have failed either to appreicate or consider the unintended consequences of the legislation. Indeed, Mr Barker accepted in the Westminster Hall debate that the wood panel industry had not been considered within the scope of the RHI Impact Assessment. Further, he quoted figures in the debate which demonstrate a profound failure of understanding of the issues involved.

"This failure even to consider the wood panel industry, and the use of inappropriate and inexact data, is profoundly concerning both to Norbord and our constituents. The most basic analysis would demonstrate that the impact on the wood panel industry will be potentially devastating.

"Further discrimination would make the closure of wood panel plants in the UK, including Norbord's facilities in Cowie, Inverness and Devon, a real possibility. This is clearly an unacceptable state of affairs for a sector which produces nearly £100m of tax revenues, £1bn of economic activity and supports 8,700 jobs.

"It may well be that the Department of Energy and Climate Change (DECC) is willing to sacrifice the wood panel industry on the altar of the Climate Change agenda. And, although Mr Barker claimed several times in the Westminster Hall debate that this is not the case, DECC's actions seem significantly at variance with these protestations.

With the demand for wood now outstripping supply, a recent study by the United Nations found that there could be a shortage of up to 400 million m³ of wood in Europe by 2020 due to the demands of biomass.

DECC estimates that the demand for wood for energy under the RO and RHI targets will reach 50 million tonnes. This is against a UK supply of 12 million tonnes, according to DECC estimates. Demand is now outstripping supply and cost of the raw wood materials used by the wood panel industry and the biomass producers has rocketed by 60% in the past three years. However the wood panel industry does not enjoy the enhanced buying power enjoyed by the energy producers through the ROC subsidy.

Despite continued lobbying by the Wood Panel Industries Federation (WPIF) and a recent European-wide protest against the directive, the industry's concerns have yet to be considered by the country's energy policy makers.

This growing concern was further confirmed recently when it was announced that the RHI's Impact Assessment did not cover any potential impact on the wood industries. The exlusion comes after the WPIF submitted extensive supporting evidence to DECC.

Mr Morris added: "We are not anti-biomass and, indeed, as an industry we have pioneered the burning of our process-derived wood residues to generate heat and power, which is then fed back into our own manufacturing process. This is the most efficient use of this scarce resource. The introduction of a renewable heat incentive is to be welcomed, but to exclude the pioneer of this technology and the largest generator of renewable heat makes no sense.

"The current direction of travel that DECC is embarked upon will lead inevitably to the utterly perverse outcome of perfectly usable wood being directed, through a distorting and ill judged subsidy, to an increase in CO2 emmissions, reduction in Renewable Heat generation, and reduction in employment.

"We have asked many times that DECC consider rebalancing this equation through the RO and, particularly, the RHI funding mechanisms. In particular, it seems both unreasonable and unfair that, as the UK's single largest industrial generator of Renewable Heat, we should be excluded from the RHI process. To be 'punished' as an early adopter, and for competitive advantage to be given to new entrants, is economic and environmental madness.

Although we have received backing by MPs and a wide range of other organisations and individuals, it's vital that political decision makers now being to listen seriously to our calls for more responsible use of wood and to create a level playing between ourselves and our competitors across the energy sector."

Fergus Ewing visits Norbord plant at Inverness

Thu, 7 Apr 2011 00:00:00 GMT

Chancellor George Osborne has been warned that the UK government's flagship policies could push a leading Highland employer out of business.

Fergus Ewing, SNP candidate for the Scottish Parliament constituency of Inverness & Nairn, has written to Mr Osborne and Treasury Secretary Danny Alexander to inform them of concerns about the effects of the renewable heat incentive (RHI) and renewables obligation (RO) on the wood panel industry.

The government launched the RHI earlier in the month as part of its strategy to revolutionise the way heat is generated and used in the UK. Believed to be the first of its kind in the world, the policy aims to support emerging technologies and businesses in the UK as well as strengthening security of supply and reducing dependence on fossil fuel heating and emissions.

Wood panels, a vital component in the construction industry and in furniture manufacture, are produced from virgin and reclaimed wood - the same materials which biomass energy plants are being subsidised to burn. However, the wood panel industry has been excluded from the policies and this could have a dire effect on local manufacturer Norbord, which employs 120 people at its plant at Morayhill, near Inverness.

Mr Ewing said: "I have written to the Chancellor and the Treasury Secretary to inform them that government subsidies for biomass energy generation are having dire consequences for the wood panel industry across the UK and could, ironically, lead to substantial increases in carbon emissions funded by the taxpayer

"Electricity generators, purely as a consequence of the RO subsidy, can afford to pay more than double the price currently paid by the wood panel industry for its primary raw material. This sustained buying power competition has distorted the market and resulted in wood panel manufacturers seeing an average woodprice increase over the last four years in excess of 60%, a trend which will only continue and accelerate.

"Further discrimination as a result of exclusion from the RHI would make the closure of wood panel plants in the UK, including Norbord near Inverness, highly likely. This is clearly an unacceptable state of affairs for a sector which produces nearly £100m of tax revenues, £1bn of economic activity and supports 8,700 jobs, and I have asked Mr Osborne to intervene to clear up the anomaly by including the wood panel industry in the RHI."

With the demand for wood now outstripping supply, a recent study by the United Nations found that there could be a shortage of up to 400 million metres squared of wood in Europe by 2020 due to demands of biomass.

Despite continued lobbying by the Wood Panel Industries Federation (WPIF) and a recent European-wide protest against the directive, the industry's concerns have yet to be fully considered by the country's energy policy makers. This growing concern was further confirmed last week when it was announced that the RHI's Impact Assessment did not cover any potential impact on the wood industries. The exclusion comes after the WPIF submitted extensive supporting evidence to the Department of Energy and Climate Change (DECC).

Independently assessed data, which has been provided on numerous occasions to DECC, confirms that should such substitution transpire i.e. should the 4 million tonnes processed by the wood panel industry be burnt for energy, the consequences would be in complete contradiction with the ambitions of the Climate Change agenda. Under such circumstances CO2 emmissions would actually increase by six million tonnes p.a. - taking into consideration the carbon gain of switching from coal to wood fired generation; UK Renewable Heat generation would fall by a third- taking into account the contribution the wood panel industry makes today to the renewable heat generated in the UK and subsidies of close to £500m will be paid to energy companies; to burn the wood that is today used in the production of wood panels that will store carbon rather than release it into the atmosphere.

Other consequences could be that substitution of the wood to burning for energy will reduce employment by 4,400 (again using Government's own assessment and expectations of re-absorption rates). The incentives work directly counter to the EU mandated Hierarchy of Use. This hierarcy recognises the common sense value of use, re-use, and recycle, before recovery through burning.

As well as its Morayhill plant, Norbord also employs more than 250 people at Cowie, Stirlingshire and a further 400 at its site in South Molton, Devon. Karl Morris, MD of Norbord said: "We are not anti-biomass and, indeed, as an industry we have pioneered the burning of our process-derived wood residues to generate heat and power, which is then fed back into our own manufacturing process. This is the most efficient use of this scarce resource. The introduction of a renewable heat incentive is to be welcomed, but to exclude the pioneer of this technology and the largest generator of renewable heat makes no sense.

"The current subsidy regime means that wood panel manufactuing companies are seeing wood prices being driven up and shortages in supply of its primary raw material. Although we have received backing by MPs and a wide range of other organisations and individuals, it's vital that political decision makers now being to listen seriously to our calls for more responsible use of wood and to create a level playing between ourselves and our competitors across the energy sector."

Friends of the Earth US wades into Forth Energy debate

Wed, 6 Apr 2011 00:00:00 GMT

Friends of the Earth (FOE) US have added their voice to the growing number of opponents to a proposed biomass plant in Leith. In an open letter written by their biofuels campaign coordinator, Kate McMahon urges the Scottish Government to reject Forth Energy’s proposals.

The FOE contribution marks a significant addition to the debate about biomass demand and its impact on the natural environment and existing forest markets. In addition to highlighting the impact on ecosystems, biodiversity and sustainability, Ms McMahon stresses the impact of increasing demand on existing forest product industries. Quoting a peer-reviewed study, the letter asserts that as ‘prices increase marginal wood consumers in existing markets will be displaced’. As things stand in the UK, current subsidies for biomass mean this remains a very real threat for wood processors such as the Wood Panel Industries Federation (WPIF).

Furthermore, Ms McMahon criticises Forth Energy’s application for failing to consider growing biomass demand both in the US and in the UK. The demand precipitated by the Port of Tilbury plant alone equals 7.5 million tonnes of wood per year, the majority of which will be sourced from North America. The FOE US letter makes it very clear that current supplies of North American wood will not be able to meet the combined biomass demand in the UK and US. Forth Energy’s proposal to build multiple biomass plants, therefore, is distinctly unsustainable and their assertions that they will source wood from producers certified by the "Sustainable Forestry Initiative" (SFI) or by the "Forest Stewardship Council" (FSC) are a long way from addressing the sustainability problem.

FOE US have made a welcome contribution to the debate. It would appear that the WPIF is not alone in believing that current approaches to biomass need a serious rethink.

The letter can be viewed here:

http://www.guardian.co.uk/edinburgh/2011/mar/31/leith-biomass-friends-of-the-earth-open-letter/print

Minister of State for Energy and Climate Change agrees to meet with industry representatives

Thu, 17 Mar 2011 00:00:00 GMT

The Right Hon. Anne McGuire MP delivered a speech yesterday on the concerns of the wood panel industry caused by biomass subsidies. Contributions were also made by Susan Elan Jones MP (Clwyd South), Guy Opperman MP (Hexham) and Cathy Jamieson (Kilmarnock and Loudoun). The assembled MPs took the Minister to task on the governments' policy towards biomass energy.

The Minister of State for Energy and Cliamte Change, Greg Barker MP, welcomed the opportunity to meet with Anne McGuire and industry representatives to listen to their concerns. Furthermore, the Minister apologised for not including the industry's representation in the recent Renewable Heat Incentive (RHI) Impact Assessment.

The debate can be viewed here:

http://www.parliamentlive.tv/main/Player.aspx?meetingId=7986&player=windowsmediapasting

Conservatives add to objections against Leith biomass plant

Thu, 17 Mar 2011 00:00:00 GMT

Conservative candidates for the Holyrood elections have added their concerns to the growing number of opponents to the Forth Energy proposed biomass plant at Leith. In an article published by STV (which is copied in full below) Tory candidates add their concerns to those of local businesses and community groups.

Conservatives add objections against biomass plant

A public inquiry on Leith's biomass plant seems inevitable as more objections are revealed.

By Clare Carswell 17 March 2011 09:20 GMT

Objections from Conservative politicians against the proposed Leith biomass plant look to make a public inquiry almost inevitable.

Tory candidates for the Holyrood elections in May, Iain McGill for Edinburgh Central and Sheila Low for Edinburgh Northern and Leith have lodged their objections with the Scottish Government in what Mr McGill described as, "the biggest Edinburgh issue going on at the moment".

He joins the ranks of politicians also in opposition, Mark Lazarowicz MP (Labour), Sheila Gilmore MP (Labour), Malcolm Chisholm MSP (Labour), Shirley-Anne Somerville MSP (SNP) as well as Greens Councillor Maggie Chapman.

And with cross-party unity, the plans are now more likely than ever to go to inquiry.

Mr McGill campaigned as the Conservative candidate for North Leith in the Westminster elections last year and said that the impact of the proposed plant is not restricted to Leith.

He said: "It is coming up on the doorstep of those in Edinburgh Central but it is also coming up in Murrayfield and the Old Town."

His objection lists numerous reasons why the plant should not go ahead including, the proposed location, the emissions, the potential damage to local roads due to increased traffic and the potentially detrimental effects to business and ecology.

He said: "It doesn't add up given the number of arguments against it. Forth Ports and Scottish & Southern Energy should pay more attention to the people in Edinburgh than their share price. It's just wrong, wrong, wrong."

Mr McGill also confirmed that the Conservative Party as a group take the same stance.

He said: "We were asked about this last year in the run up to the election and we were against it and we are continuing that."

At council level there may also be Conservative opposition.

Conservative Councillor Joanna Mowat who sits on the City of Edinburgh Council planning committee said: "My initial reading of the plans I have concerns regarding how this fits in with local development plans and structural plans and I am looking for those concerns to be reconcilled before I can support this application."

Cllr Mowatt stressed that there was a great deal of information to review before a decision can be made.

She said: "It's a big decision that may trigger a public inquiry and is therefore a decision that must not be taken lightly."

Local organisation, Friends of the Water of Leith Basin would be delighted if a public inquiry was initiated.

Chairman, George Johnston said: "We have been hoping for a public inquiry.

"The majority of people in Leith are demanding that this does not go ahead, we haven't heard of anyone who has spoken in favour of it."

He added: "People are coming to Leith for the cafe culture we have three Michelin star restaurants here and excellent bars the sight of the plant and the emissions from it will not encourge people to come to Leith."

Some firms in Leith are members of the Federation of Small Businesses and are deeply concerned about the potentially detrimental impact to their work.

One member of the FSB, restauranteur Tony Borthwick of the Michelin starred, Plumed Horse said: "I moved to Leith, both personally and business wise, as it was an up and coming place to be.

"We now find ourselves in the precarious business position of our diners not wanting to come to Leith because of this.

"The Tram fiasco is bad enough for it's massive impact on businesses, now we find that a hefty subsidy is bribing the powers that be into accepting this.

"Bio Mass may sound all fluffy and ecologically friendly, but it isn't,

"Everyone knows it isn't, and we all know what it will do to our whole lives, even if we don't have any kind of disaster."

He added: "This facility could easily be moved elsewhere, away from a local community and thriving part of the capital where it will not have such a massive impact upon lots of lives and businesses."

However, Forth Energy, the company behind the biomass plant of which Forth Ports and Scottish and Southern Energy are joint shareholders remain adament that Leith is a suitable location and the design is not unreasonable. They have also pointed to the additional jobs it would bring to the area.

Calum Wilson, managing director of Forth Energy, said: “The site we are proposing to build on is within an existing industrial area.The port location offers a unique advantage, enabling the generation of renewable energy from fuel delivered directly to the plant by ship, a low carbon form of transport.

"The plant is well placed to co-exist with, and supply low carbon heat to, other developments in the area, as well as attracting further investment in the Leith area.

“The proposals for the plant meet Scottish Government’s objectives, to increase the use of renewable heat and encourage the decentralisation of energy generation.”

Some 1800 have registered objections to the plan.

Shirley-Anne Sommerville MSP objects to Forth Energy Leith Biomass Plant

Thu, 17 Mar 2011 00:00:00 GMT

Shirley-Anne Sommerville makes two prinicpal complaints: firstly, that the proposed location of the plant is entirely inappropriate and secondly, that such a proposal, should it be consented to, would fly in the face of Scottish Government policy regarding biomass energy.

MP raises concerns about wood sustainability

Wed, 16 Mar 2011 00:00:00 GMT

Anne McGuire, MP for Stirling has posted an article on ePolitix in advance of the Westminster Hall debate which follows an announcement about the Renewable Heat Incentive.

The Wood Panel Industries Federation (WPIF) commends the fact that the piece criticises the Government for not taking biomass sustainability seriously.

While the wood panel industry certainly does not oppose support for small-scale heat generation from wood, the industry remains concerned that DECC has yet to produce a coherent bio-energy strategy that recognises the enormous demand for wood created by subsidy for wood-fired electricity. The WPIF urges the Government to reform the Renewables Obligation to reflect pressures on wood supply, which are undermining the competitiveness of wood processing businesses and the broader wood industries.

Anne McGuire MP's article can be viewed online here and is copied below:

http://www.epolitix.com/latestnews/article-detail/newsarticle/the-wood-panel-industry/

MP raises concerns about wood sustainability

By Anne McGuire MP - 16th March 2011

Last week's announcement on the Renewable Heat Incentive was an attempt to turn attention to decarbonising the heat sector. However, it has serious ramifications for the forest industries, introducing another incentive for biomass energy generation – largely produced from wood in the UK.

As chair of the all-party group for the Wood Panel Industry, I am well aware of the distortion that biomass subsidies are causing to the UK’s wood market, where supply is already struggling to meet demand. The wood panel industry produces two-thirds of the UK’s consumption of wood-based panels – chipboard, MDF and oriented strand board – wholly using UK-sourced, sustainable wood, both virgin and recycled.

The decision to exclude the wood panel sector's existing renewable heat capacity – responsible for a third of all UK industrial renewable heat – is a mistake because it will further undermine that industry's ability to buy wood. It will also threaten its existing renewable heat generation, based on its own process residues. DECC clearly has not taken concerns about wood sustainability seriously, as the RHI's Impact Assessment did not even mention potential impacts on the forest industries.

Biomass is unlike most renewable energy technologies because it has ongoing fuel costs and competes with an established market for its feedstock. Whereas an incentive for wind power principally discriminates against an equivalent fossil fuel energy generator, an incentive for biomass discriminates against industries that make excellent use of the same raw material (wood), turning it into low-carbon construction products and locking carbon up, often for decades. Therefore, the case for supporting biomass energy must be based on the highest possible environmental gains.

However, the government continues to provide substantial subsidies, through the Renewables Obligation (RO), for the large-scale generation of electricity from wood. This is a notoriously inefficient process, where over two-thirds of the energy is wasted, much through heat loss. Large biomass plants also consume vast quantities of wood. The Prenergy Plant being built at Port Talbot will consume around 3 million tonnes of wood a year – over a quarter of the UK’s entire annual wood harvest.

The government's response has been that other wood streams are available to support biomass energy growth, such as waste wood, brash and other peripheral material. If this material is feasible for bioenergy, why are the financial support mechanisms not geared specifically to incentivise their use? The introduction of the RHI without a serious impact assessment on wood processing suggests that DECC is in denial about the sustainability of the domestic and global biomass resource.

The best way to end market distortion and to achieve the best environmental outcomes is to end support for electricity only generation from wood and exclusively support good quality combined heat and power, heat generation and energy from low-grade wood waste. This would ensure high energy efficiencies, it would protect wood recycling, and it would reduce landfill. It would also greatly reduce the impact on wood processors, who play a vital role in carbon abatement through the manufacture and recycling of low-carbon, sustainable construction and furniture materials.

Anne McGuire has been Labour MP for Stirling since 2005. Parliamentary private secretary to Labour Party leader Ed Miliband, in 2010 she was elected unopposed to the public accounts committee.

Westminster Hall Debate on the wood panel industry

Tue, 15 Mar 2011 00:00:00 GMT

The Wood Panel Industries Federation (WPIF) is delighted that there will be a Westminster Hall debate on Wed 16th March, from 2.30 until 4pm.

The debate has been secured by the Chairman of the Wood Panel Industry APPG Anne McGuire MP, and it is hoped many WPIF supporters will attend in an attempt to impress upon the Government the detrimental effects of biomass subsidies. The title submitted for the debate is “Government policy on the wood panel industry and the UN International Year of Forests” and Greg Barker, Minister of State for Climate will be responding on behalf of DECC.

The UN declared 2011 as the International Year of Forests to raise awareness of sustainable management, conservation and sustainable development of all types of forests. There is significant concern about the sustainability of wood demand from the biomass energy sector and its impact on traditional forest industries. The Renewables Obligation and the forthcoming Renewable Heat Incentive are key drivers of this demand and must be shaped by environmental, economic and social imperatives. This debate will focus on the effect of Government policy on the UK’s wood panel industry and its contribution to carbon abatement.

Channel 4 News on the impact of biomass demand on timber prices

Fri, 11 Mar 2011 00:00:00 GMT

Channel 4 News reported this week on the government subsidies to encourage power companies to burn wood which are distorting the market for timber and forcing up prices in manufacturing and construction industries.

Channel 4 News: Timber prices up as power plants boost biomass use

The largest consumer of biomass fuel in the UK is now the Drax power plant in Selby, North Yorkshire. It is also the largest source of carbon dioxide emissions in the UK as a result of burning coal.

This raises questions about incentive schemes for biomass power in the UK, which were established to try and encourage farmers to grow alternative sources of biomass fuel or to see wood recycled before being burned.

Senator, Britain’s largest office furniture manufacturer, says the price it pays for chipboard, one of its main materials, has gone up 30 per cent, with a 10 per cent increase in the last quarter alone.

“Biomass burning wood is hitting our industry and any industry that uses wood based products,” says Paul Clarke, commercial director.

While around 30 new biomass power plants have been approved or are awaiting planning permission, Drax is now in the unique position of being Britain’s largest single source of renewable energy as well as our largest source of carbon dioxide emissions.

‘Biomass is a really good opportunity’
This year Drax completed a new biomass facility to increase the amount of wood and other agricultural by-products like husks and straw it can burn alongside coal in its furnaces.

Last year Drax burned around 900,000 tonnes of biomass – mostly wood. Its owners say that the subsidy on biomass – around £25 for every megawatt-hour in the case of Drax – should be increased to allow them to burn more. Its ultimate ambition is for at least half of its fuel to be biomass – around 7 million tonnes a year.

“Biomass is a really good opportunity for the UK and the world to reduce carbon emissions,” said Peter Emery, production manager for Drax Power Limited.

Given the scale of Drax’s carbon emissions, burning biomass is one of the only ways the plant can meet legally binding targets to reduce carbon emissions in the medium term.

The current subsidy system allows them to burn a maximum of 12.5 per cent. They are now lobbying government to have that cap raised.

“If we don’t get that support then I think we are squandering a real opportunity to save carbon emissions today. Not just at Drax but in the UK generally.”

Making something positive
But any increase in subsidy that encourages power plants to burn virgin timber – often imported from overseas – would unnecessarily harm their industry, said Paul Clarke.

“We want the wood to come to us so we can make something positive out of it – use it for a life of 20 years or so before Drax and the people burn it to get power back,” said Clarke. “The power is always there – we want to use the wood first.”

Their factory in Accrington, Lancashire, has been part-powered by off-cuts from wood used in the plant for 12 years.

As Senator see it, subsidy for biomass fuel should reward people for either making use of waste timber or alternative sources of fuel that don’t impact other sectors.

Domestic supply chain for wood
The subsidy system was set up to encourage farmers and foresters to grow biomass crops. These include grasses like miscanthus, as well as fast-growing trees like willow and poplar.

Subsidy is also designed to reward new, small-scale, purpose-built biomass plants – not existing fossil-fuel plants.

“The idea behind subsidising burning of biomass in coal-fired power stations was to try and establish domestic growers, and a domestic supply chain for wood,” said Dr Rob Gross, Director of the Centre for Energy Policy and Technology at Imperial College, London.

“If that could be made to happen, then that would be a very good thing for biomass fuel and it should also relieve the pressure on furniture makers and other users of wood,” he added.

“Unfortunately despite trying for about the last 10 years, as yet that hasn’t happened.”

Rising wood consumption
Industry body, the Wood Panel Industries Federation, estimates that there is the capacity in the UK to produce 16.6 million tonnes of wood each year.

They say if the government were to achieve its 2020 greenhouse gas emissions targets for biomass generation, wood consumption would have to rise to about 50 million tonnes per annum.

Studies funded by the UK Energy Research Centre, however, suggest that if currently unused agricultural land in England, were planted with coppiced wood, an extra 7 million tonnes could be produced each year – the same mount Drax plans to burn.

In a statement, the Department for Energy and Climate Change told Channel 4 News: “It is not our intention for our renewable support mechanisms to adversely affect other industries.

“We believe this can be minimised by increasing the supply of wood and forestry residues available, better management of our waste wood, and the increased use of other biomass resources such as food waste and perennial energy crops.”

BBC coverage of sustainability concerns about biomass heating

Thu, 10 Mar 2011 00:00:00 GMT

On 10th March 2011 Radio 4's Today Programme interviewed its environment analyst Roger Harrabin on the launch of the renewable heat incentive (RHI).

Listen here: http://news.bbc.co.uk/today/hi/today/newsid_9420000/9420694.stm

The RHI is the Government’s attempt to reduce the carbon emissions attributable to heat production, which analysts say are greater than those attributable to electricity generation. Providing long-term financial support to renewable heat installations, it is hoped the scheme will encourage the uptake of renewable heat. However, although the aims of the policy seem environmentally credible, the Today Programme’s coverage of the RHI announcement highlighted crucial sustainability concerns.

Government says it has sustainability rules that will apply to this scheme, so as not to take out virgin land, but Roger Harrabin raised an additional problem. Double-counting of land when assessing potential biomass availability is currently confusing understanding of just how much land there is available. In turn, the multiple counting of the amount of land that we have to grow forests for heating or other energy needs is starting to mirror anxieties over ‘peak oil’. Mr Harrabin questions whether the matter is becoming a question of reaching ‘peak land’. Of equal concern is the prospect of reaching ‘peak wood’, the mainstay of biomass demand.

Biomass plants are proliferating across Europe, subsidised by governments reaching for ambitious energy targets. The combined biomass demand for EU member states – declared in their national renewable energy plans – is just short of a 1 billion tonnes of wood every year. This level of demand would require the total global harvest of wood to increase by a third. The Wood Panel Industries Federation (WPIF) questions whether such an increase in the global harvest is possible. If not, the UK Government and its counterparts should take a long hard look at whether their investment in big biomass is sustainable.

It is worth considering the lessons learned from first generation biofuels. Environmentalists now question whether biomass demand will turn out to be as unsustainable and environmentally damaging as the Government’s foray into biofuels, where the clearing of rain forests to fuel cars with palm oil proved highly controversial.

Scottish Zero Waste Consultation: Time to Make Wood a Priority Material

Tue, 1 Mar 2011 00:00:00 GMT

Scottish Zero Waste Consultation: Time to Make Wood a Priority Material

The Wood Panel Industries Federation (WPIF) has responded to the Scottish Government’s Zero Waste consultation. The proposals outlined are encouraging and the WPIF welcomes the Government’s progressive approach to waste management.

The Scottish Government published the Zero Waste Plan on 9 June 2010, which sets out the strategic direction for waste policy for Scotland and proposed 22 actions to be taken to deliver it. This consultation, entitled Implementing Scotland’s Zero Waste Plan: regulatory measures to require separate collection of waste materials, and restrict disposal in landfill and input to energy from waste facilities, covers 3 of those actions relating to the introduction of regulatory measures to:

· drive source segregation and separate collection of specified waste materials;

· implement a phased programme of landfill bans (effectively banning materials which could be re-used or recycled or which could be used to produce energy); and

· restrict inputs to Energy from Waste (EfW) facilities (effectively banning materials which could be re-used or recycled)

In providing a response, the WPIF has also strongly encouraged the Scottish Government to consider four major factors:

· A clear separation of recyclable and contaminated wood (to ensure that all suitable wood is re-used and recycled rather than incinerated)

· Future feasibility of a ban on wood to landfill (to maximise the opportunity for reuse of suitable wood)

· The incentive regime for biomass energy generation and waste regimes in the rest of the UK (e.g. to prevent valuable waste streams such as uncontaminated waste wood being incinerated in England)

· Capital support for WID-compliant EfW plant (to encourage take-up of contaminated wood)

These factors are closely inter-connected; the biomass industry, subsidised by the Renewables Obligation, is increasingly looking to waste wood as a feedstock. As the consultation points out, it is vital to ensure that “only waste which could not have been recycled is incinerated”. Energy plants will naturally gravitate to the cheapest and easiest material – namely, uncontaminated wood – unless specific measures are put in place to focus incentives (and restrictions) around contaminated wood, including a strict definition of what constitutes contaminated wood.

The industry fears that without a clear and stringent definition of what constitutes contaminated, wood otherwise suitable for recycling and reuse will be sent to EfW plants. The industry looks forward to working with the Scottish Government on developing standards and definitions for the use of waste wood. We also encourage the Scottish Government to explore what measures it can implement to prevent English and Welsh EfW plants from sourcing recyclable wood from Scotland.

The consultation closed on 28February and the consultation documents can be viewed in full here: http://www.scotland.gov.uk/Publications/2011/02/09135833/0

Implications for electricity consultation as experts raise doubts on biomass sustainability

Wed, 23 Feb 2011 00:00:00 GMT

The Committee on Energy and Climate Change launched an inquiry on 21 July 2010 into the Government's decision to consider introducing an emissions performance standard (EPS). The guiding principle behind the EPS is to prevent coal-fired power stations being built unless they are equipped with sufficient carbon capture and storage. The EPS would form part of a wider framework to help decarbonise the whole power sector to less than 70gCO2/kWh in a bid to meet the UK's 2050 carbon emissions target.

Whilst the Committee is largely supportive of an EPS, it considers that the existing policy framework is not sufficient to deliver the level of investment in new low-carbon generating capacity needed to meet the target. It remains concerned that the interactions and overlaps of an EPS with existing policies as well as proposed new electricity market reforms are not yet sufficiently understood.

The experts who attended the first evidence session on 12 October 2010 expressed other concerns on a number of matters, including the need to adequately consider and calculate the emissions resulting from biomass plants in addition to wider factors such as land-use change implications (provoked by increased demand for biocrops). The first report can be viewed in full here: http://www.publications.parliament.uk/pa/cm201011/cmselect/cmenergy/523/52302.htm

The most important and consistent caveat put forward by experts included giving due consideration to the total emissions of biomass plants. Professor Jon Gibbins (University of Edinburgh) pointed out that largescale biomass plants contribute their fair share of CO2 emissions: “With large-scale biomass at the moment we are seeing some travesties of environmental do-goodery…because we are seeing 295 MW biomass plants being built, which is 5 MW under the capture-ready limit. If you are going to build a large biomass plant like that, it should have CCS at that scale”. Professor Gibbins went further to say that largescale biomass plants are “…a very large source of carbon; it’s about the same amount of carbon as an 800 MW gas plant”[1] (Examination of Witnesses, Question 21).

The promotion of largescale biomass without adequate provision for CCS was also questioned by Dr David Kennedy (Chief Executive, Committee on Climate Change) who explained, “They need to be thinking as well, “If we’ve got constrained biomass here in the UK and globally constrained biomass, where is it best used?”, and it’s not clear that it is best used in electricity generation when you have alternatives to decarbonise it”[2] (Examination of Witnesses, Question 22).

The wider implications of encouraging biomass on land-use options were highlighted by Nick Molho (Head of Energy Policy, WWF UK), “If we are replacing 2% of forests with 2% of agricultural land on which we are going to be using biocrops, we are losing those carbon sinks, which in turn actually ends up having a negative impact on our overall emissions”. Mr Molho went further to point out the possibility of taking a holistic view of biomass plant emissions, “You can either just look at the direct emissions on site, or you actually take a broader, more holistic view and try to look at the whole lifecycle of the greenhouse gas emissions of biomass, which would take into account the land-use changes as well as the direct emissions on the site”[3] (Examination of Witnesses, Question 53).

The Wood Panel Industries Federation (WPIF) is pleased to hear several of its viewpoints echoed in the evidence given and agrees that if the power sector is to be successfully decarbonised, then all carbon emitting technologies must be considered under an EPS, including biomass. As Professor Jon Gibbins expressed via memorandum, “Biomass utilisation is treated as carbon-neutral and largely ignored in most regulatory regimes whereas in fact it may have significant fossil emissions involved in its production; but this is immaterial in determining whether to capture the CO2 from the biomass instead of re-emitting it to atmosphere. Biomass combustion also usually has higher CO2 emissions per unit energy (kgCO2/MWh) emitted at the power plant site than coal”[4] (Written Evidence, Footnote 19).

Similar views were expressed by the environmental think tank Green Alliance who consider “that an EPS policy could play a role in setting out a widening scope for power sector decarbonisation and providing clarity on the types of investment that will be rewarded under reformed electricity market conditions. Crucially, this means that an EPS needs to encompass all fossil fuel types and biomass”[5] (Written Evidence, 4.5).

The Government’s consultation on electricity market reform runs until 10 March 2011 and the White Paper, legislative proposals to implement the new electricity market arrangements, will be launched in Late Spring 2011.

[1] http://www.publications.parliament.uk/pa/cm201011/cmselect/cmenergy/523/10101202.htm

[2] http://www.publications.parliament.uk/pa/cm201011/cmselect/cmenergy/523/10101202.htm

[3] http://www.publications.parliament.uk/pa/cm201011/cmselect/cmenergy/523/10101203.htm

[4] http://www.publications.parliament.uk/pa/cm201011/cmselect/cmenergy/523/523we05.htm#note19

[5] http://www.publications.parliament.uk/pa/cm201011/cmselect/cmenergy/523/523we11.htm

Publication of Electricity Market Reform Consultation

Mon, 24 Jan 2011 00:00:00 GMT

Reforms aimed at moving the UK to the front of the global race for electricity investment, driving the growth of clean energy industries in the UK, and ensuring the best possible deal for consumers were proposed by coalition Ministers on 16^th December 2010.

DECC and HM Treasury have together launched consultations on fundamental reforms to the electricity market to ensure the UK can meet its climate goals and have a secure, affordable supply of electricity in the long term. Key proposals include:

Four reforms to provide long-term certainty for electricity investors
A new market to have built-in level playing field for low carbon
Rules for existing investments protected
Long term impact on household electricity bills lower than under the current market

The Consultation ends on 10^th March 2011 and a White Paper is expected in late Spring 2011.

The intention of the consultation is to examine the reforms necessary to achieve the Government’s objectives on decarbonisation, renewables energy, security of supply and affordability.

The Scottish Government issued an initial response to the consultation on 16th December 2010 commenting that Scotland is on track to achieve their target of 31% of electricity consumed in Scotland being provided by renewable energy, and that they are confident of delivering 80% by 2020. However, Scotland’s good track record with regard to renewable energy remains dependent on a “stable and supportive policy and regulatory environment, and the right balance between effectively functioning markets and targeted support mechanisms”[1].

The Wood Panel Industries Federation (WPIF) also intends to publish a response to the consultation with a particular focus on the implications of the introduction of renewable electricity Feed-in-Tariffs (from as early as 2013) as a replacement for Renewables Obligation Certificates (ROC) (which under current proposals will remain until 2017).

The cumulative effects of the current Renewables Obligation regime and the growth of large-scale wood fired electricity generation have significantly affected the member companies of the WPIF and have distorted the UK wood market, where demand is beginning to outstrip supply. If nothing is done to address this distortion it could threaten the very existence of the wood panel industry.

Whilst the WPIF welcomes the Government’s initiative to support renewable energy, current proposals result in direct competition over wood feedstock between subsidised biomass power plants and wood panel manufacturers. Although DECC has said that at least 90% of the predicted wood requirements of the energy sector will be sourced from overseas, there is growing evidence (including announcements within environmental policy statements) that the energy sector is intent on acquiring as much UK-sourced wood as possible for the simple reason that wood imports are up to three times as expensive as domestic wood. Subsides for capital expenditure in the UK biomass sector should instead focus on the expansion of non-wood fuels and fast-rotation crops. Alternatively, if we are to ensure the sustainability of feedstocks for biomass fuels then that energy production needs to be conducted on a smaller scale and through high efficiency processes such as combined heat and power.

Wood is a precious resource which needs to be used and managed responsibly. The wood panel industry supports responsible stewardship of the nation’s forestry resources and works continuously to minimise their carbon footprint, increase the recycling of recovered wood and harness renewable heat production. WPIF believe that progress towards low carbon manufacturing should be encouraged rather than threatened. As long as the Government incentivises unsustainable large-scale electricity generation from wood, the industry remains under threat.

[1] Initial Response to the UK Government’s Electricity Market Reform consultation document, paragraph 5, p.1 (2010) http://www.scotland.gov.uk/Topics/Business-Industry/Energy/Infrastructure/Grid-Connections/EMR-consultation-UK/Initial-SG-response

Wood Panel Industry Supports European Day of Action Against Unfair Subsidies

Thu, 28 Oct 2010 00:00:00 GMT

WPIF and member companies in the UK and Ireland are uniting with panel manufacturing companies across Europe in a day of action being promoted by the European Panel Federation in protest against subsidies being given for biomass energy. Across Europe, wood is the preferred fuel of biomass generators.

Subsidies spark unintended resource shortage in EU

Fri, 22 Oct 2010 00:00:00 GMT

PRESS RELEASE

Subsidies spark unintended resource shortage in EU

Complexity of issue leads to unintentional ‘environmental idiocy’, says Ladislaus Döry, President of the European Panel Federation

Brussels, 11 October 2010.
A debate today lifted the lid on a hitherto unrecognised side-effects of the EU’s renewable energy policy: the financial incentives to burn wood harvests. Experts at high-level panel debate in the Flemish Parliament revealed how subsidies for woody biomass make it more profitable for forestry byproducts to be sold as fuel for incineration rather than for use as wood (in furniture, construction, etc). Wood panel manufacturers warn that the unintended consequences of EU Biomass subsidies re endangering their industry, putting at stake jobs, rural communities and the environment. They raise the spectre of wood biomass becoming the next biofuels debacle, unless policymakers act now.

Large-scale biomass threatens 8,700 UK jobs... and risks a 1% increase in UK emissions

Mon, 28 Jun 2010 00:00:00 GMT

Wood panel industry unveils five point plan to safeguard its future
Sector under threat from 30% increase in wood price over last four years

Research revealed today has identified that the spiralling development of large-scale wood fired energy plants in the UK threatens 8,700 UK jobs* and risks a 1%, or six million tonne, increase in UK carbon emissions.

These are the headline findings of two independent reports commissioned by the Wood Panel Industries Federation, the voice of the UK industry, which today launches a survival campaign, ‘MAKE WOOD WORK’, to counter the severe market distortion its members face from the Renewables Obligation (RO) subsidy regime.

Wood panels, a vital component in the construction industry and in furniture manufacture, are produced from virgin and reclaimed wood – the same materials which biomass energy plants are being incentivised to burn by Government policy driven subsidy.

The Wood Panel Industry in the UK , A report for the Wood Panel Industries Federation, conducted by Europe Economics, found that:

· The total gross UK employment attributable to wood panel manufacture amounts to 8,700 full time equivalent jobs

· If large-scale wood fired power generators demand for UK-sourced wood is encouraged to develop unchecked, the sawmilling sector could also experience structural change in which generators will buy the whole tree and invest in forest properties and product preparation. The employment effects will therefore not be confined to wood panel manufacturing but could extend to the 12,000 or so people estimated by the Forestry Commission to work in sawmilling and related activities

Further research from CarbonRiver, identified that:

· To subsidise the purchase of wood for incineration – as the current ROC scheme does – is to encourage the most carbon-intensive use of that resource

· If the ROC subsidy continues to distort the market such that panel manufacture is displaced by the biomass industry – as trends suggest it might – there would be an increase in net CO2 emissions equivalent to 1.5 tonnes of CO2 per tonne of wood processed, a total increase of 6 million tonnes or 1% on the UK’s total net CO2 emissions each year (more than the total emissions of UK agriculture last year)

In simple terms, the wood panel manufacturing sector is under threat because electricity generators, supported by subsidy, can afford to pay more than double the price currently paid by the UK wood panel industry for its primary raw material. The blame lies with the introduction of the RO, which has distorted the market and resulted in WPIF members seeing an average wood price increase over the last four years in excess of 30%.

Alastair Kerr, Director General of the Wood Panel Industries Federation comments: “Ourresearch proves categorically that the Government’s renewable energy policies – specifically support for biomass – are directly damaging the competitiveness of the wood panel industry in the UK, which is wholly reliant on domestically-sourced wood.

“If nothing is done to amend this policy, wood prices could potentially rise to a point where they meet that paid by generators for imported material. This will put thousands of jobs in the UK wood panel and associated industries at risk and has the potential to escalate costs for the construction and furniture industries. Consumers of UK-sourced products, who are already paying for the subsidy through their electricity bills, cannot escape the impact of this distortion.

“The Government is putting too great an emphasis on large scale wood-fired electricity and, by subsidising generators’ ability to pay for fuel, they are threatening to destroy an industry that adds economic value and brings environmental benefit through carbon storage.

“We are not anti-biomass and, indeed, as an industry we have pioneered the burning of our process-derived wood waste to generate heat and power, which is then fed back into our own manufacturing process.

“Backed by MPs and a wide range of other organisations and individuals, our campaign today calls for a more responsible use of wood – one of our most precious natural resources. But, importantly, we are not asking for special treatment – just a level playing field.”

As a result, and through the MAKE WOOD WORK campaign, the Wood Panel Industries Federation (WPIF) is calling on Government to:

· Modify the ROC banding in such a way as to remove its distortion in the market. The WPIF supports subsidy for capital expenditure in the UK biomass sector but not subsidy for its use of domestic wood as a feedstock

· Ban wood – an increasingly precious resource – from landfill and maximise the lifespan of all wood in the UK

· Focus the subsidy on the expansion of non-wood fuels and fast-rotation crops, as these have a greater potential to reduce CO₂emissions in the short term. In the long term, the amount of UK forest cover should be increased

· Only allow wood that has reached the end of its useful life, and after recycling opportunities have been exhausted, to be used by the energy sector in installations that maximise the heat potential of this valuable resource

· Recognise the wood panel industry’s sizeable contribution to UK renewable heat generation under the Renewable Heat Incentive – and treat it as a special case by including its eligibility in the RHI and offer our industry an essential lifeline

*From Europe Economics’ report “ If the industry vanished today, the loss of employment would be some 8,700 jobs gross and about 4,400 net (taking account of the standard government re-absorption factor, which recognises that, over time, displaced employees find other employment)

- ENDS -

Notes to editors:

Full details of the MAKE WOOD WORK campaign including the independent economic and environmental reports, video interviews and a detailed newsletter can all be downloaded free at www.makewoodwork.co.uk

About The Wood Panel Industries Federation (WPIF)

The WPIF represents the wood panel manufacturing sector in the UK which occupies seven sites and supplies approximately 60% of the UK demand for wood-based panels. Each of these sites is a major player in the local economy; most with workers from within a small catchment area, and in many cases provide employment to a number of members of the same family. There are four manufacturing companies based in the UK :

· Egger (UK) Limited in Hexham, Northumberland, employs 575 people

· Kronospan Limited in Chirk, Clywd, employs 555 people

· Norbord Limited employs 988 people across three sites at South Molton , Devon ; Cowie, near Stirling and Dalcross near Inverness

· Sonae in Knowsley, Merseyside, employs 225 people

About Europe Economics

Europe Economics is an independent private sector economics consultancy which specialises in regulation, competition policy and public policy issues. The firm advises a wide range of clients including governments and regulators, the European Commission and Parliament, leading law firms, private sector companies and representative trade bodies.

About CarbonRiver

CarbonRiver’s market leading IP and world class expertise delivers a powerful turnkey solution for high integrity, efficient carbon accounting and emissions management for Enterprises and Supply Chains, Products and Services. Its comprehensive approach enables companies to make both cost and emissions savings, and simultaneously demonstrate responsibility and good stewardship.

Contacts:

Media:

Oliver Williams 0207 269 7294 oliver.williams@fd.com

Christopher Clark 0207 269 7201 christopher.clark@fd.com

Wood Panel Industries Federation:

Alastair Kerr 01476 563707 akerr@wpif.org.uk