Biomass power generator, Drax, has claimed that the government could generate £2.2 billion of savings if it gave greater consideration to the most cost-effective sources of clean energy.
According to a new analysis, commissioned by Drax, and conducted by NERA Economic Consulting and Imperial College, solar and wind power actually have other hidden costs, such as the need for back-up power generation. The report argues that converting coal plants to run on biomass is the most cost-effective renewable generation available at scale.
The savings would result from making biomass eligible for future subsidies. The power firm has already converted half of its North Yorkshire coal power plant to run on biomass and has voiced concerns regarding the future of green subsidies.
Dorothy Thompson, chief executive of Drax, said: "Intermittent renewables like wind and solar are vital... but they need to be backed up by a constant supply of electricity that can be flexed up and down. Opening up energy auctions to include other renewables could save consumers £2 billion and with more biomass in the mix energy security is also boosted.”
The analysis comes as the Department for Energy and Climate Change (DECC) examines the issue of ‘whole system costs’ of different energy technologies. The government is planning three auctions for green subsidies, with the first due to come into action this year, allowing ‘less established technologies’, such as offshore wind, wave and tidal stream to compete for contracts.
In a statement, a DECC spokesman, said: "We are already supporting over 5GW of biomass technologies, providing nearly a quarter of our renewable electricity generation.
"We are ensuring a sensible level of support so that we safeguard value for money - keeping bills as low as possible for hardworking families and businesses."