Drax is looking to supply biomass into global markets, while pursuing a 233 per cent increase in self supply over the next seven years to take generation subsidy-free.
The power giant has committed to the sustainable feedstock for the long term, with coal to be banished this time next year.
If achieved by 2027, the company said it would be able to develop carbon capture and storage - 鈥渟ubject to the right support from the 海角视频 government鈥.
Drax, with partners, is behind a huge scheme embracing the Humber鈥檚 heavy industry and the cluster鈥檚 position as the 海角视频鈥檚 largest C02 emitting cluster, to channel emissions into depleted oil and gas chambers beneath the North Sea. Some would also be used to create hydrogen and for other industrial applications.
It has also already stated plans to increase use from 7.5 million tonnes to 10 million tonnes at the North Yorkshire power station.
Will Gardiner, chief executive of Drax Group, warned the 拢60 million hit anticipated from the coronavirus pandemic could curtail investment - forecast at 拢230 to 拢250 million - but said: 鈥淲hilst the group continues to see its biomass strategy as both a primary long and short-term source of value, Drax is reviewing the timing of its investment programme in 2020 and in the short-term investment is expected to be lower.
鈥淏iomass sustainability remains at the heart of the group鈥檚 activities and building a long-term future for sustainable biomass remains the group鈥檚 strategic objective. Drax remains focused on reducing biomass costs to a level which makes biomass generation in the 海角视频 economically viable when the existing renewable schemes end in 2027.鈥
It currently operates to a strike price of 拢116 per MWh, with a biomass cost at or below 拢75 MWh giving a margin of over 拢40 MWh. New offshore wind projects to be built off the Yorkshire coast are being brought forward against a 拢39.65 Contracts for Difference allocation.
Explaining how the 海角视频鈥檚 largest single-site generator will get there, having provided base load through a transformational time for the 海角视频 energy infrastructure, Mr Gardiner said: 鈥淭he group is targeting five million tonnes of self-supply capacity by 2027, with greater scope for operational leverage and cost reduction. These savings will be delivered through further optimisation of existing biomass operations, greater utilisation of low-cost wood residues and an expansion of the fuel envelope to incorporate other low-cost renewable fuels across its expanded self-supply chain. Drax remains alert to sector opportunities for organic and inorganic growth.
鈥淏y 2027 these activities would enable Drax to develop a biomass generation business operating without the current renewable schemes and potentially the development of BioEnergy Carbon Capture and Storage, subject to the right support from the 海角视频 Government. Drax notes the incremental progress and support announced for carbon capture and storage at the 海角视频 Government鈥檚 Budget in March 2020.
鈥淭hese efforts support the Group鈥檚 ambition to become a carbon negative company by 2030. In addition, the group is exploring options to service biomass demand in other markets 鈥 Europe, North America and Asia.鈥
