Sunday, June 16, 2024

Greater demand could fall on renewables to keep the lights on by the end of the decade, says Baringa

New research carried out by Baringa on behalf of renewable energy company Drax Group has shown that by the end of the decade biomass generation could play an increasingly critical role in ensuring security of UK energy supply.

The research highlights the critical contribution that biomass could play in late 2020s as coal plants and nuclear fleet close down.

And in the meantime Drax is to pause this year’s investment in its carbon capture project as it waits for clarity of Government’s commitment – without BECCS support Drax Power Station could become unviable by 2027.

Baringa’s research shows that by then, peak demand for GB electricity will increase by 4GW but at the same time the imminent closure of coal, older gas generation and nuclear power stations will remove up to 6.3GW of secure capacity from the grid.

This will mean that the dispatchable capacity which supports GB energy security will fall from 93% to 85% at times of peak demand, increasing the risk of a supply shortfall. The system will need to rely on other forms of capacity, such as electricity interconnectors and intermittent renewable generation like wind or solar, to make up the 15% difference at times of peak demand, or steps may need to be taken to reduce consumption such as through voluntary demand reduction or forced turndown.

Drax power station is currently the largest provider of dispatchable power to the GB electricity system, as well as being one of the only renewable sources of secure supply. Its renewable biomass generation provides 2.6GW of electricity, supplying millions of homes and businesses with dispatchable, reliable power.

Whilst Drax welcomed the Government’s support for CCS in the recent Budget, it needs its BECCS project to gain Track 1 status, without which, Drax Power Station may become unviable and unable to contribute secure power at a time of such critical need. Until it receives this clarity, Drax has taken the decision to pause it’s multi-million-pound investment programme into the BECCS project at Drax Power Station.

At times with the tightest margins, Drax’s biomass units provide up to 11% of total GB electricity generation and up to 70% of the renewable generation. The loss of Drax’s and other biomass units from the GB electricity system would further reduce the country’s dispatchable capacity to 80% of peak demand (from the already forecasted fall to 85%), increasing reliance on gas and power imports, generation from intermittent renewables, and increasing costs for consumers.

Drax CEO Will Gardiner said: “Whilst we welcome the Government’s ambition to invest billions in carbon capture and storage, we need a firm commitment to BECCS before we commit to investing £2bn into installing this technology at Drax Power Station.

“Until we have this clarity, we are pausing our multi-million pound investment programme in the UK BECCS project and urge Government to use the planned announcement at the end of the month to outline their support for this. Any further delays to this project could impact the UK’s security of supply, net zero and levelling-up ambitions and the viability of Drax Power Station.”

The research also found that by 2027 no established technology can feasibly replace the security of supply provided by Drax’s 2.6GW of biomass capacity, without significantly increasing carbon emissions and relying more on imported fossil fuel from Europe.

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