Power giant on course to achieve emissions cut

THE operator of Britain’s largest power station, based in Yorkshire, said it has completed more than two-thirds of the £100m turbine upgrade which will help cut its level of carbon dioxide emissions.

Drax Group said the scheme, believed to be the biggest in turbine modernisation in British history, is currently saving 500,000 tonnes of CO2 a year and that this would increase to one million in 2012, when the project is due to finish.

Drax, the 4,000-megawatt (MW) coal-fired power station, based near Selby, in North Yorkshire, supplies around seven per cent of Britain’s electricity but is under pressure to reduce emissions as part of Britain’s commitment to reduce greenhouse gases by 34 per cent by 2020.

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Managers also repeated their call for more government support in subsidies and regulatory structures for the burning of organic plant-based biomass in power generation, which would provide a major boost to their renewable output.

Drax, which last month reported higher annual profits and sales, is replacing the low-pressure and high-pressure steam turbines on all six power station units with Siemens Power Generation.

The upgrade, which began in earnest in 2008, was designed to make Drax’s use of coal more efficient and to improve the reliability of power output. It involves the replacement of more than 87,000 turbine blades.

The manufacture of the remaining turbines will be completed this year with the components assembled at Siemens’ German facility, in Muelheim, north of Dusseldorf in the Ruhr valley.

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Drax is trying to increase the lifespan of its plant and believes it generated about seven per cent of Britain’s renewable power in 2010 by burning biomass, which ranged from wood chips to elephant grass. That equated to about 904,000 tonnes of biomass, more than double a year earlier.

However, it burned only half of its biomass capacity – six per cent instead of 12.5 per cent – because insufficient subsidies made it uneconomical to burn more.

Peter Emery, Drax production director, said: “Biomass typically costs two to three times more than coal, and even when the cost of carbon is factored in, it is currently cheaper to burn coal, hence why we need the Government to set an appropriate level of regulatory support.”

The company has made several changes since one of its trains was targeted by environmental campaigners in 2009, but the poor state of the public finances means any Government decision to provide more cash could spark further protests.

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Mr Emery said Charles Hendry, Energy and Climate Change Minister, and senior department officials have visited the plant to learn more about its plans for biomass.

Last month, Dorothy Thompson, chief executive, said Drax had become a “quite significant” renewable generator and called for more state help.

“Biomass co-firing gets a quarter of the support of offshore wind. With more support, but not as much as offshore wind, we could deliver 50 per cent more renewable output.”

Mr Emery said biomass, the world’s fourth-largest energy source after oil, coal and gas, is readily available but that Drax needs government backing for it to be developed.

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When asked, he declined to put a figure on the level of a possible subsidy.

“While Drax’s profits may seem big to the man on the street, it is a big chunk of the profits and the company (has to) pay dividends to the shareholders.

“The business has to make big numbers to make money. It will have trouble convincing many shareholders to burn biomass at a loss. We need to make money in biomass. We have got a duty to shareholders to maximise money for the business – we are not a charity.”

It fitted extra biomass co-firing capacity in 2010, at a cost of £80m, and also has plans for three new 290 MW dedicated biomass plants under a £2bn investment.

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But Ms Thompson said these will not go ahead until support levels are clear, and he welcomed an ongoing review of subsidies.

The 100,000-tonne, straw-pellet plant, based in Goole, is “operating well”, the firm added.

Drax’s bid for EU money

Drax is bidding for European Union money to develop a new 426-megawatt (MW) standalone “clean” power demonstration project in Selby, North Yorkshire, the home of its 4,000MW power station.

Drax will work with French engineering group Alstom and National Grid on the carbon capture and storage project. The companies have lodged a bid with the Government for partial EU funding.

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National Grid and “an experienced offshore partner” will develop a system to transport compressed carbon dioxide out to the southern North Sea, where it will be stored permanently.

If the bid is successful, it could revive plans to establish a cluster of CCS projects in the Humber region.

A decision on which applications it will support, is expected from the British Government on May 9.