UK plant nears full switch away from coal

From being one of the worst polluters in the country, Drax has pivoted to an ambitious policy to reduce carbon emissions. (AFP/File)
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Updated 01 June 2020

UK plant nears full switch away from coal

  • The Drax operation, providing 4 million households with electricity, sees CO2 emitted from burnt wood captured by newly planted trees

LONDON: As the coronavirus pandemic undermines the production of cleaner renewable fuels, the UK’s biggest electricity plant is close to using only biomass following a bumpy transition away from coal.

Situated in Yorkshire, northern England, the Drax Group power plant will complete its switch next year after embarking on a journey almost a decade ago to use organic matter alongside the fossil fuel to slash carbon emissions.

But the company’s method of capturing CO2 continues to raise concerns even as biomass has become Britain’s second largest renewable energy behind wind power, with only a handful of coal-run plants remaining in the UK. The Drax operation, providing 4 million households with electricity, sees CO2 emitted from burnt wood captured by newly planted trees.

Drax adds that the switch, in line with UK government policy to ban the use of coal by 2025, allows it to keep the plant running and maintain 900 jobs.

“More than 10 years ago, Drax was looking at its future ... and the UK, at the same time, was looking about how it could deliver its climate change objectives,” recalls Drax CEO Will Gardiner.

“And those two things came together in a very auspicious way so that there was a good recognition in the UK that biomass was a very good alternative ... to increase renewable power,” he told AFP in an interview. But the use of biomass to generate electricity is not without controversy.

In 2018, a total of 800 scientists wrote to the European Parliament calling for such biomass to be limited to wood residues, including cut branches, to limit deforestation. But even with such a move, gains to the environment can be trimmed by sourcing wood from afar. “Once you move from local usage ... to extracting trees from distant countries and shipping them to a factory, you are adding quite a significant amount of additional CO2 to the atmosphere,” noted Michael Norton, environment program director at European Academies Science Advisory Council (EASAC).

Norton added that it “takes anything from several decades to centuries to recover through the growth” of new trees.

The Drax plant imports from North America 80 percent of the wood that it burns, although Gardiner stresses that the company uses branches that otherwise would “rot in the fields and emit CO2.”

The International Energy Agency last week said in a joint report that “COVID-19 is intensifying the urgent need to expand sustainable energy solutions worldwide” — a timely boost for companies like Drax amid ongoing criticism regarding their net contribution in helping to tackle climate change.

“The growth of electricity generation from renewables appears to have slowed down as a result of the pandemic, according to the available data,” said the report, written also by the World Health Organization.

“But they so far appear to be holding up much better than other major fuels such as coal and natural gas,” it added.

Gardiner told AFP that he “doesn’t think there will be any coal or natural gas in our system in 2050.”

He added: “In the UK, I think wind power in 2050 probably will be 80 percent of the energy mix.

“At the same time, you always need something else in addition to wind power to provide for flexibility and for system support,” he said, noting that “biomass can do that.”


Oil giants’ production cuts come to 1m bpd as they post massive write-downs

Updated 34 min ago

Oil giants’ production cuts come to 1m bpd as they post massive write-downs

  • Crude output worldwide dropped sharply after the market crashed in April

LONDON: The world’s five largest oil companies collectively cut the value of their assets by nearly $50 billion in the second quarter, and slashed production rates as the coronavirus pandemic caused a drastic fall in fuel prices and demand.

The dramatic reductions in asset valuations and decline in output show the depth of the pain in the second quarter. Fuel demand at one point was down by more than 30 percent worldwide.

Several executives said they took massive write-downs because they expect demand to remain impaired for several more quarters as people travel less and use less fuel due to the ongoing global pandemic.

Of those five companies, only Exxon Mobil did not book sizeable impairments. But an ongoing reevaluation of its plans could lead to a “significant portion” of its assets being impaired, it reported, and signal the elimination of 20 percent or 4.4 billion barrels of its oil and gas reserves.

By contrast, BP took a $17 billion hit. It said it plans to recenter its spending in coming years around renewables and less on oil and natural gas.

Weak demand means oil producers must revisit business plans, said Lee Maginniss, managing director at consultants Alarez & Marsal. He said the goal should be to pump only what generates cash in excess of overhead costs.

“It’s low-cost production mode through the end of 2021 for sure, and to 2022 to the extent there are new development plans being contemplated,” Maginniss said.

London-based BP has previously said it plans to cut its overall output by roughly 1 million barrels of oil equivalent (BOEPD) by the end of 2030 from its current 3.6 million BOEPD.

Of the five, Exxon is the largest producer, with daily output of 3.64 million BOEPD, but its production dropped 408,000 BOEPD between the first and second quarters. The five majors, which include Chevron Corp, Royal Dutch Shell and Total SA, also cut capital expenditures by a combined $25 billion between the quarters.

Crude output worldwide dropped sharply after the market crashed in April. The Organization of the Petroleum Exporting Countries agreed to cut output by nearly 10 million barrels a day to balance out supply and demand in the market.