Regulator investigates power giant Drax as skepticism grows over its ‘green’ biomass claims
The UK’s energy regulator is questioning power station operator Drax as skepticism grows over its green claims.
Ofgem is investigating whether the company that generates electricity by burning wood pellets at its factory in Yorkshire complies with sustainability regulations.
In October, the watchdog told the Low Carbon Contracts Company, a government agency that manages energy contracts, that Drax had provided documentation to show that the Canadian woody biomass it used in 2021 and 2022 was certified under the Sustainable Biomass Program, a program that certifies whether wood pellets used in industrial energy production have been obtained sustainably and legally.
Biomass fuel: Ofgem is investigating whether Drax, which generates electricity by burning wood pellets at its Yorkshire plant (pictured), complies with sustainability regulations
At least 70 percent of a generator’s woody biomass must be classified as sustainable under UK rules. But Ofgem has since hired US consultant Black & Veatch to conduct an additional audit to “protect ourselves from potential outside scrutiny,” according to the Financial Times.
Drax has consistently said that the wood pellets are sustainable. But green groups say energy generation from biomass is not carbon neutral and pellet production contributes to deforestation.
Drax has been criticized by green groups for receiving around £1.7 million a day in renewable energy grants from the government.
The probe comes as Drax plans to buy back £150 million of shares after making millions from a rise in prices. It forecasts revenues between £1.1bn and £1.2bn for 2023.