A plan to introduce new carbon capture technology to the largest coal-fired power station in the UK has been dropped by British energy company Drax.
The company had previously been involved with the development of the technology that aims to reduce carbon emissions by collecting CO2 before it enters the atmosphere. The plan had originally aimed at storing this captured carbon in the ground in the area surrounding its power station in North Yorkshire.
The company has stated that it has had to end the project because of the reduction in renewable energy subsidies from the government. It said that while the plan was seen as a great step towards creating a more environmentally friendly energy source, the lower subsidies simply made the scheme too expensive to justify to shareholders.
Carbon Capture “Full of Potential”
The chief executive of Drax, Dorothy Thompson, stated that it was a regrettable decision and the plan had been seen as full of potential.
She went on to say:
“The most recent effect has been the government has removed a tax exemption for renewable power that is sold to industrial companies and we’re the largest generator of renewable power in the UK and this has suddenly removed a stream of income.”
“The day it was announced our share price dropped by a third and that simply reduces the amount of cash we have available for future investments.”
The cut in subsidies also effects the governments support for wood pellets, which act as a renewable biomass fuel and which Drax had been using at their plant.
The project had been named White Rose and, according to Drax, it had the capacity to capture 90% of the carbon emissions that were produced by the coal-fired power plant.
Government Subsidies Reduced For Renewable Energy
Angus Neil is the chairman of the Energy and Climate Change Committee, he said that the government is largely responsible for the decision that Drax have made.
“They certainly didn’t consider what they were doing and they’ve left Drax in a very invidious position at the moment. Drax itself would have been actually carbon negative, in that they were burning biomass and then were going to be storing that capture, so they would have been taking carbon out of the atmosphere.”
“So what Drax were doing was very exciting. And this is a very unfortunate situation. But in many ways it’s actually when you think about it not surprising, due to the wrecking ball approach the UK government have taken.”
Biomass Fuels “The Future”
CEO Dorothy Thompson said that the company’s financial position had also been affected by the change in the price of commodities around the world. The company now plans to focus on the development of biomass fuels as they are “the most affordable, the most reliable and the fastest move away from fossil fuels”.
A statement was released by the Department of Energy & Climate Change saying:
“CCS is set to play a vital role in decarbonising the electricity sector and heavy industry.
“The government remains committed to assisting the development of CCS in the UK and to the CCS Competition, continuing to negotiate with the two preferred bidders.”
