About Drax
Drax is a UK energy company led by CEO Will Gardiner. ForbeslistsDrax’s 2020 revenue at $2.9 billion.
In2019, its annual emissions totaled 15.1 million tonnes of carbon dioxide equivalent, of which 12.8 million tonnes was from burning carbon-intensive biomass. In2020, this increased to total emissions of 19.4 million tonnes of CO2 equivalent, of which 13.2 million tonnes was from burning biomass.
13.2m
In 2020 Drax’s reported annual emissions from burning biomass totaled 13.2 million tonnes.
£832m
In 2020, Drax was estimated to have received £832 million in government renewables subsidies for its biomass energy.
The truth behind the greenwashing
Following the company’s move from coal into biomass, Drax’s CEOsaysthat “Biomass has a long-term role to play in the UK and global energy markets”. However, biomass can produceeven moreCO2 emissions than coal if not regulated properly. Sourcing the fuel for biomass has been linked to deforestation, degrading the natural carbon sinks we need for a safe climate. There is significant controversy over rules that permit biomass emissions to be part-counted.
Greenhouse gas emissions attributable to Draxincreasedfrom 15.1 million tonnes of CO2 equivalent in 2019 to 19.4 million tonnes of CO2 equivalent in 2020.
But its ads tell a different story...
The reality
Drax frequently repeats the claims that by moving from coal to biomass it is “enabling a zero carbon, lower cost energy future”, that it has slashed its emissions by 85% since 2012, and that its Drax power station is “Europe’s largest decarbonization project” – on itswebsitepages, onYouTube, in itsAnnual Reportfor investors, to thepress, andso on. However, Drax’s claim that wood biomass – which made up75%of its electricity generation in 2020 – can actually be considered a ‘zero’ or even low-carbon source of energy, like wind or solar energy, iswidelydisputed.
Drax’s burning of wood biomass has beenfoundto producehigherlevels of CO2 from smokestacks than its coal did, but these combustion emissions are allowed to be counted as ‘zero’ under international carbon accounting principles and EU and UK law, on the basis that any deforestation should be counted elsewhere, at the forest level.
Relying on this carbon accounting practice, the companysaysit has reduced its reported carbon emissions by over 85% since 2012, since it began moving from coal to biomass. This ‘reduction’ is largely explained by excluding the GHG emissions from burning wood pellets (biomass), which amounted to nearly 70% of Drax’s total emissions in 2020. In reality, these GHG emissions are still coming out of the smokestacks of Drax’s huge power plant in the North of England.
The company’s Head of Climate Change explains this byclaimingthat:
But scientistscallintoquestionthe assumptions behind the carbon accounting: that forests are actually expanding, includingbecausethey are harvested, and that the ‘carbon payback’ from forest growth over decades will happen in time for urgent climate pathways. The climate impact of removing wood depends on the type – sawmill residues or logging by-product that would be burned anyway is not the same as the removal of trees or disturbance of soil which would otherwise capture carbon. However, felling trees for biomass energy can deplete forest carbon sinks.
There issignificant controversyover the appropriateness of the carbon accounting treatment of wood biomass energy and over what types of biomass should be permitted. The European Joint Research Centresaysthat “the governance of bioenergy sustainability is characterised by uncertainty about consequences, diverse and multiple engaged interests, conflicting knowledge claims and high stakes”.
NGOs have also presentedevidencethat forest biomass harvesting in the US and in Eastern Europe too often involves ‘clear-cutting’ or felling trees, which they argue impacts the forest carbon sink. Drax sources the majority of its wood (4.6 million tonnes of wood pellets in 2020) from the US. Enviva, the US company Drax sources its biomass from,has beenaccused by campaigners of sourcing wood pellets by felling coastal hardwood forests in the US, contributing to deforestation and the destruction of important carbon sinks and ecosystems in the region. Campaignerspoint toevidence that Drax’s suppliers in these regions make pellets from whole trees.
In its 2021report, the European Joint Research Centrefoundthat “the harvest of native, mature, high-biodiversity value trees for energy use would be a clear lose-lose option” for climate change and for biodiversity, as would using larger pieces of wood debris and stumps. It found that only the removal of “fine, woody debris” (or tree tops and branches) both helped fight climate change and had a positive or neutral effect on biodiversity, provided this was “below thresholds defined according to local conditions”.
Drax’s supply appears to involve substantial amounts of this ‘lose-lose’ biomass. The company’sAnnual Reportsays the company used 7.3 million tonnes of wood pellets in 2020, of which 3.1 million came from “sawmill and other wood industry residues”. “Thinnings” and “Low grade roundwood” from forests accounted for 3.8 million tonnes. “Branches and tops” amounted to 196,000 tonnes. Drax does not argue that all this wood would be cut and burned anyway.
For its part, Draxhasset up an Independent Advisory Board on biomass sourcing andcommissionsits own studies of forest growth in the areas where it sources about two thirds of its wood pellet supply. The studiesconcludethat its forest harvesting is not problematically impacting productivity over large forest areas. The company denies allegations of unsustainable wood harvesting, andsaysthat its supply is in line with recommendations of UK’s Forest Research and UK law. In its Annual Report, the company describes the substantial emissions from burning biomass, the lion’s share of its total emissions, as “iologically sequestered carbon”, explaining in a footnote that “the use of sustainable biomass is considered to be CO2 neutral at the point of combustion”.
Drax’s websitesaysthat it is at the forefront of tackling climate change and has “transformed the UK’s biggest power station to become Europe’s largest decarbonisation project”. Whilst Drax’s adverts suggest its biomass energy is reducing emissions, counting carbon emissions from burning wood biomass as ‘zero’ under carbon accounting does not mean that they do not exist. Drax’s switch from coal to biomass is not the same as real world emissions reductions. Because of this, the growing wood biomass energy industry is seen by scientists as worsening, rather than helping, with the fight against climate change.
Climate pledges
Draxsaysit is the world’s leading sustainable biomass energy and supply business. It operates the huge Drax power station in the North of England, which itsaysis the UK’s biggest renewable power station, providing 6% of the UK’s electricity.
In December 2019, Draxannouncedthat it plans to become “carbon negative” by 2030. This would mean that it plans to absorb more carbon dioxide from the atmosphere than it produces.
Draxsaysit has phased out much of its coal power generation in March 2021 and will completely phase out coal power by 2022,while continuing to produce electricity by burning biomass and with hydro power. The company now mainly relies on biomass - in 2020, biomasswas75% of Drax’s electricity generation. Its CEOarguesthat “iomass has a long-term role to play in the UK and global energy markets”.
Draxsaysenergy from biomass, produced by burning wood pellets, is sustainable and renewable because the forests from which these are sourced absorb carbon dioxide from the atmosphere, offsetting the emissions released when the pellets are burned. It relies on international carbon accounting rules and EU/UK law which permit it to count biomass burning emissions as ‘zero’.
In addition, Drax istrialingbiomass energy with carbon capture and storage (BECCS), a new technology designed to capture and store the CO2 released when the biomass is burned.
As well as its biomass and remaining coal power operation, in 2020 Drax generated electricity from hydro-power and fossil gas. Theserepresented2% and 15% of its energy output, respectively. Drax has recently completed the sale of its existing gas assets and cancelled its plans to build what would have been Europe’s largest gas plant.
Biomass is a 'false solution'
In February 2021, scientistswroteto world leaders warning that biomass is a “false solution” to climate change. The scientists said that “n recent years there has been a misguided move to cut down whole trees or to divert large portions of stem wood for bioenergy, releasing carbon that would otherwise stay locked up in forests”.
Theyconcludedthat “[g]overnment subsidies for burning wood create a double climate problem because this false solution is replacing real carbon reductions.” Theletterwarned that “there is good evidence that increased bioenergy in Europe has greatly increased forest harvests there”. In 2020, Draxsourcedover half a million tonnes of “low grade roundwood” from European forests.
In 2020, Drax is estimated to have received£832 millionin government renewables subsidies for its biomass energy, up from£789.5 millionin 2019. In 2019 itsaidthat “The vast majority of our business relies on subsidies”, although the company says it aims to avoid reliance on subsidies in the future. Ember’s February 2021analysisshows that the total public subsidy given to the company has increased steeply in the last five years, and assesses no obvious climate benefit in return for this public money. EU and US authoritiesappearto be signalling that the treatment of biomass energy may change.
Draxadmitsthat, whilst biomass is treated by governments as a renewable at present “there is a risk that biomass is not accepted either in the UK or in other jurisdictions as a renewable source of energy”. The company alsorecognisesthat “[o]ur ability to influence EU requirements on biomass acceptability / sustainability may be impaired post-Brexit” but the company will engage with politicians and officials “to understand and influence perception”.
In the meantime, the companyis doubling downon forest biomass, with its wood pellet production up 7% in 2020, plans to invest further in biomass and expand its North American pellet plants. Drax’s 2020 AnnualReportsays that it wants to grow its own biomass supply to 5 million tonnes per year, from the 2020 level of 1.6 million tonnes. The CEOtalksof increasing global demand for wood pellets and “an abundance of unprocessed sustainable biomass material globally”. This is in contrast to the acknowledgment in the UK’sIndustrial Decarbonisation Strategyof “limited sustainable biomass supply”.
In February 2021, the company proposed adealto acquire a Canadian wood pellet production business, Pinnacle Renewable Energy, to double its supply of biomass fuel pellets, as Drax’s CEO talked of the company’s strategy to “create a long-term future” for biomass.
The CEO admitted that parts of the Canadian business currently use fossil gas power to dry out the wood pellets in the manufacturing process, as the alternative of burning yet more wood to dry out the pellets caused too much air pollution. In November 2020, Drax’s Mississippi wood pellet production operation werefinedUS$2.5 million for having breached US air pollution limits for years, putting local communities at risk.
Greenpeace’s chief scientist wasreportedas commenting that “sing gas to dry wood for burning in a power station, specifically with the aim of reducing fossil fuel use, provides a great example of the publicly funded madness” of biomass energy.
'Magical thinking' on carbon capture
Drax intends to rely on carbon capture and storage (CCS) to capture the substantial CO2 emissions from burning biomass for its aim to become a carbon negative company by 2030. However, its plans for bioenergy carbon capture and storage (BECCS) technology have also beencriticised.
Even the world’s most advanced carbon capture and storage projects remain relatively inefficient, and extremelyexpensive. The world’s first commercially used CCS project at Boundary Dam in Canada, has recently only managed tostorearound 60-70% of the carbon emissions it processes. There is a history ofrepeatedfailuresto scale-up CCS, and plans for economically viable CCS have beencalled‘wishful thinking’. In 2010, carbon capture facilities planned to capture a total of around 130 million tonnes of CO2wereunder development globally. However, plans did not come to fruition and capture capacity remains tiny – ten years later in 2020 the entire operational global capacity of CCS did not quitestretchto 40 million tonnes of CO2 per year.
Drax’sBECCS pilot projectin North Yorkshire cannot store carbon and demonstrated the capture of one tonne of carbon from biomass a day. In 2020, it started a second pilot project with Mitsubishi Heavy Industries, whichreportedlycaptures 0.3 tonne of CO2 per day. In its 2020 report, the companysaysthat BECCS is now proven at scale and it believes can remove millions of tonnes of its CO2 emissions “from 2027”.
Drax’s BECCS project also relies on wood biomass and is subject to some of the samecriticisms, because its use would not address any damage done to natural forest carbon sinks or the emissions related to manufacturing wood into pellets and shipping them internationally. Based on experience with coal CCS, capturing CO2 isestimatedto use 20-30% of a power plant’s generating capacity – an ‘energy penalty’ which would mean that Drax’s BECCS would require yet more wood fuel to function. The UK Climate Change Committee has also emphasised in its recent Sixth Carbon Budget advice that BECCS must be “contingent on sourcing sustainable biomass, given concerns over the associated lifecycle emissions”. CampaignerscallDrax’s carbon negative plans ‘magical thinking’, and scenarios reliant on BECCS arecriticisedfor potentially “encouraging decision makers to lock themselves into high-carbon options in the short term”.
In March 2021, environmental organisationswroteto Drax’s shareholders warning that Drax’s plans will not deliver negative emissions after accounting for the full carbon footprint of biomass, and urging them to vote against the company’s proposed attempt to double its wood pellet supply by buying Pinnacle Renewable Energy for over £400 million.
The future of gas is getting shorter
ClientEarthtookthe UK government to court over approvals granted for Drax’s plans to build what would be Europe’s largest fossil gas power plant in North Yorkshire. As the UK’s Planning Inspectorate found, the approval risked locking in significant greenhouse gas emissions for decades to come, at odds with the roll out of rapid decarbonisation. In January 2021, the Court of Appeal upheld the approval but set an important climate planning precedent, confirming that the UK government can refuse planning permission on climate and carbon lock-in grounds under the applicable planning policy.
In February 2021, Drax thenannouncedthat it was shelving plans for the massive gas plant as it would not fit with their climate strategy. The CEO said "[t]he future of gas power generation fuel is getting shorter all the time". Recentdatashows that demand for gas in the UK continues to be displaced by renewables, and Carbon Tracker hasassessedthat new UK gas power plants would be expensive stranded assets in the making compared to clean energy, posing lock-in risks to the UK’s net-zero target.
