UK’s National Audit Office unconvinced of biomass sustainability for fuel

In the UK, over the past two decades, government has provided more than £20 billion of support to businesses using biomass in the power and heat sectors – a key part of its net zero ambitions. Yet government cannot currently demonstrate that its approach to making sure generators comply with its sustainability requirements is adequate, according to a new National Audit Office (NAO) report.

Biomass materials, such as plants or food waste, can be used in generating power or heat, or for fuelling vehicles. In 2022, biomass made up 11% of the UK’s electricity generation. The government and independent Climate Change Committee (CCC) considers biomass to be low-carbon if generators adhere to sustainability criteria set by government1 and monitored by Ofgem.

To enable government to monitor compliance with these criteria, participants submit regular information to Ofgem and can draw on third-party certification – an approach which is set out in legislation. But the government has not evaluated whether its current arrangements are effective at ensuring compliance.

The Department for Energy Security and Net Zero (DESNZ) argues its approach is proportionate. However, the NAO’s report sets out its view that the lack of an evaluation means the government cannot demonstrate that its current arrangements are adequate to give it confidence that industry is meeting sustainability standards.

Looking to the future, DESNZ has also committed to strengthening its sustainability criteria. For biomass to play a significant role in meeting long-term climate targets depends on the success of government’s carbon capture utilisation and storage (CCUS) programme. If biomass is enabled with carbon capture and storage (known as BECCS), it could generate negative emissions. There are no BECCS plants currently operating in the UK. DESNZ has a programme to promote CCUS technology and is negotiating commercial terms with a first wave of eight carbon capture projects, though none of these are BECCS plants.

On January 16, 2024, the Secretary of State for Energy Security and Net Zero granted development consent for Drax’s BECCS project.

Of the £22 billion of government subsidies provided to the biomass industry to date, around £16 billion has come from consumer-funded support – with £14 billion coming from the Renewables Obligation scheme, and £2 billion coming from Contracts for Difference, which guarantee generators a set price for the electricity they produce. As the largest biomass electricity generator by some distance, 36% of the Renewables Obligation funding has gone to Drax2.

DESNZ is considering whether to provide transitional support to large scale biomass generation, such as Drax and Lynemouth beyond 2027, when both their CfDs and Drax’s support through the Renewables Obligation is due to finish, to enable them to convert to BECCS in the future.