UPDATED: US subsidiary hit by $2.5M emissions penalty as Drax presses ahead on global biomass growth plans

UPDATE: Drax has completed the acquisition of biomass producer Pinnacle.

The company said that increasing self-supply and reducing biomass production costs would pave the way for it to deliver bioenergy with carbon capture and storage (Beccs). It said, “By becoming a world leader in Beccs, Drax can deliver on its purpose of enabling a zero carbon, lower cost energy future, and achieve its ambition to become a carbon negative company by 2030.  Drax will seek to export its BECCS expertise around the world to support global efforts to address the climate emergency.”
Will Gardiner,  Drax chief executive, added: Negative emissions from Beccs are vital if we are to address the global climate emergency. BECCS will also provide a significant share of the renewable electricity needed in a net zero economy, support green jobs and drive growth in a post-COVID recovery.”

 

 

From 20 February: Drax subsidiary Amite Bioenergy has paid a US$2.5 million fine to the Mississippi Department of Environmental Quality after admitting that its US biomass subsidiary Amite Bionenergy has been exceeded pollutant limits. Local environmental organisations said this was “the largest known penalty against such a facility,” which hademitted three to four times the emissions authorised..

The biomass processing plant, which produces dried wood pellets for combustion in Drax’s Yorkshire power station, had exceeded emission limits on so-called volatile organic compounds since at least 2016.

In 2019 the company promised to install additional technology, a regenerative catalytic oxidiser (RCO), that would enable the facility to meet emission limits. But the technology was not installed as promised by September  2019, according to an ‘agreed order’ dated November 2020 from the Mississippi Department of Environmental Quality.

The RCO was said to be in operation a year later, but the facility is required to limit production and will be subject to penalties of $80,000 per month if the RCO is not in operation from July 2021.

 

Biomass plans 

The record-breaking penalty comes as Drax announced the acquisition of major Canadian biomass producer Pinnacle, as part of a strategy to become a major global biomass supplier and multiply its biomass ‘self supply’ from 1.6Mt/year to 5Mt/yr.

Pinnacle’s  biomass operations, which are in Western Canada and the Southeastern US, are expected to increase from 2.5Mt/yr to 2.9Mt/yr with the commissioning of new capacity in 2021.

Drax said Pinnacle’s production capacity “provides a strong position from which to serve the growing demand for biomass in Asian markets” and help build a merchant biomass market. In 2018 and 2019, Pinnacle entered into 12 new long-term contracts in Japan and South Korea, totalling over 1.3Mt/yr.

The UK company also said the acquisition would help reach its target cost of biomass generation to £50/MWh by 2027. Pinnacle’s production cost is currently US$124/t, compared to Drax’s 2019 production cost of US$161/tonne. Drax will pay C$385 million (£226 million) for Pinnacle.

Meanwhile Drax has cancelled plans to build new gas-fired plant at its Yorkshire site. It completed the £188M sale of four UK gas-fired power stations on 31 January 2021.

 

Campaign

Drax insists its biomass is sustainably sourced but that does not convince campaigners. It is a ‘priority issue’ for the US’s Southern Environment Law Centre, which is campaigning with other US and UK organisations to cut UK biomass subsidies (see https://www.cutcarbonnotforests.org). SELC says biomass shoud be restricted to wood waste such as sawdust and clean construction debris or feedstocks where a full life-cycle carbon analysis shows a clear net climate benefit. See its data on US biomass production here.

It wants: an end to UK and EU subsidies; restrictions on the use of whole trees and the conversion of native forests into energy crops and protection for national forests and ‘old growth’ areas. 

 

8 comments for “UPDATED: US subsidiary hit by $2.5M emissions penalty as Drax presses ahead on global biomass growth plans

  1. Nikki Jones
    March 7, 2021 at 7:38 AM

    To me, as a UK resident, one of the most worrying aspects of our coal-to-biomass programme is that government has relied on this creative accounting to portray itself as one of the leading carbon cutting countries in the world. This is bare-faced lying – a complete ignoring of the facts and the science – but our ’43% reduction in carbon’ is picked up everywhere by the media as if true. It’s not just our use of biomass, but our refusal to include international shipping and aviation, embedded carbon, the carbon of imported electricity through our interconnectors, the full life cycle of gas including fugitive emissions, the full LCA of nuclear and waste to energy… But biomass is the most extraordinary in this list as, while we take down our carbon sinks, it is being represented to the British public as a positive step towards decarbonisation.

  2. Jim Merchant
    March 1, 2021 at 12:41 AM

    We all want to eliminate coal fired power plants. The coal industry has caused many environmental problems and here in N.C. we have had to deal with coal ash pond spills, pollution, and disposal. Climate change is increasingly hard to ignore or deny and climate scientists overwhelmingly agree that CO2 is the major greenhouse gas contributing to climate change, driven principally by burning fossil-fuels. These scientists have told us loudly to stop burning fossil fuels.
    So why are we replacing coal with a fuel that emits more CO2 than coal, at least 1.5x more per kilowatt hour of electricity generated. Burning wood pellets to produce electricity makes no sense and clear-cutting forests to produce wood pellets adds to the environmental damage. To add insult to injury our forests in N.C. are being clear cut, 60,000 acres last year and the acreage increases yearly. Unfortunately N.C. subsidizes Enviva with taxpayer money to log our forests. The environmental and ecosystem destruction and air pollution is hard to understand, knowing that wood pellets from our trees are shipped to England to be burned by Drax. And this does nothing to prevent climate change, indeed it is causing climate change to accelerate. The CO2 emitted from the cutting, processing, shipping, and finally burning of the pellets will remain in the atmosphere for our lifetimes and our great grandkids lifetimes, fueling the climate crisis. They will end up living on a much different planet, a world with fewer birds and insects. Audubon’s publication “Survival by Degrees: 389 Species on the Brink” reports how two-thirds of North American birds are at risk of extinction due to climate change and loss of habitat. Wood pellets are a lose-lose proposition on both sides of the Atlantic.

    A quote from Isaac Asimov, Biochemist and Science Fiction writer, is still relevant. “Humanity is cutting down its forests, apparently oblivious to the fact that we may not be able to live without them”. In my opinion we can not live without forests.

    Jim Merchant
    Raleigh, NC
    Southern Forest Conservation Coalition

  3. Tom Brennan
    February 26, 2021 at 4:47 AM

    In North Carolina/USA there are three huge wood pellet plants in the Chowan River basin that are driving massive clear-cut logging ofbottom-land hardwood forests. Two plants are in North Carolina and one in Virginia. This map maintained by Heather Hillaker and her team at Southern Environmental Law Center shows the economic logging radiuses of those plants in the basin (https://tinyurl.com/yys4lpeb).
    .
    The wood pellet industry has boomed. Biomass exports have increased tenfold since 2009, according to the U.S. International Trade Commission. In 2010, the U.S. Southeast exported about 500,000 metric tons. By 2018 that had surged to 6.5 million metric tons (about 7.1 million U.S. tons). Thousands of southern forest acres are literally being burned, albeit, in Europe.

  4. February 26, 2021 at 3:03 AM

    Imagine denuding a diverse North American forest of its trees, grinding them to dust, pressing them to pellet, loading them to ships, ferrying them across the Atlantic Ocean, and burning them with coal to electrify Europe. In the process, squashing every acre under the tread and wheel of logging equipment weighing 25 tons and more. Turtles, salamanders, shrews and mice, songbirds and all the rest are cast aside and squashed asunder. Not much escapes the fast and heavy pace of a 21st century forest clear-cut.

    Of course the idea of employing such ecological carnage to recharge our smart phones, mine included, can be seen as folly simply because more energy is required to harvest, process, and ship wood pellets from America to Europe, than the amount of energy derived by burning them. The wood pellet-to-energy scheme, like fossil fuels, is an extractive practice that releases unsustainable amounts of CO2 into the atmosphere; more CO2 than if burning only coal. In some way, burning trees to generate electricity may be viewed as a last ditch effort at energy stability. We should hope, for the sake of future generations, that we are not there yet. This is the 21st century; not the 1st.

    Now is the time to think “renewable” in one human generation time frame. Today’s grandchildren’s time frame. For their sake–not yours. What can today’s energy consumers do to help? Burn less energy–not trees.

    Willful ignorance and foolishness have no place in politics and energy policy. As stakeholders, we can ask, “How smart is a taxpayer-subsidized energy industry that double-dips off peoples’ taxes and their monthly energy bill?!” Answer: It’s as smart as burning American trees to electrify Europe.

  5. Emily Zucchino
    February 25, 2021 at 6:36 PM

    I live in North Carolina and have seen firsthand the impacts of this industry on our forests, especially the wetland forests along our coast that we need to protect us from increased flooding and hurricanes. People who live close to the plants say they feel like “prisoners in their homes” because of all the dust and noise from the wood pellet production plants. Even though this is the biggest known fine against the industry, Drax is subsidized with nearly 2 million Euro per day. The subsidies for this dirty, polluting, carbon-intensive industry should stop immediately.

  6. PETER RIGGS
    February 24, 2021 at 7:19 PM

    Sorry — that would be UK regulators — not EU regulators! Gotta get into the post-Brexit mindset. The UK should ‘cut its losses’ on biomass and deny further subsidies to Drax. Otherwise, the public will remain on the hook for over a million GBP of subsidies PER DAY.

  7. PETER RIGGS
    February 24, 2021 at 7:16 PM

    “sustainable sourcing” doesn’t deal with the huge carbon debt created by biomass burning. Peer-reviewed science shows that even burning residues creates a huge carbon debt. DRAX’s real game is try to and persuade EU regulators to continue their ‘lifeline’ of subsidies beyond 2027, when they should sunset. But this industry is not only dirty; it isn’t profitable, it will never be profitable in a ‘fair fight’ with either natural gas or true renewables. To say nothing of the fact that these wood pellet plants are always built in impoverished communities in the South, already struggling with bad air quality and environmental racism. Drax making it worse.

  8. Jack Spruill
    February 22, 2021 at 3:55 AM

    Drax is practicing a new form of vertical integration. For years it has practiced carbon emissions accounting and reporting contrary to peer-reviewed science resulting from burning wood pellets at it its North Yorkshire power plant. Now, the State of Mississippi Department of Environmental Quality has charged Drax for, since at least since 2017, having been releasing three to four times the the level of toxic, volatile organic compounds than it was authorized to emit at its Amite County wood pellet plant. Amite County has a population of 13,000 and is in southwest Mississippi just across the state line from Louisiana.

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