On Monday 19 December, the European Commission approved UK support for the conversion of a unit of the Drax coal-fired power station to run entirely on biomass. This unit will run exclusively on wood pellets.
The UK government intends to support the project with a premium paid on top of the price of the electricity generated that is laid down by the market. The project will receive the support until 2027. The power station is expected to use approximately 2.4 million tonnes of wood pellets a year, which will mainly be sourced from the United States and South America.
In January this year, the Commission opened an in-depth investigation to check that the aid would not lead to overcompensation and undue distortions of competition in the biomass market. Its investigation settled its concerns.
The investigation also showed that the wood pellets and wood fibre market was able to respond to the increase in demand for wood pellets without any undesirable negative consequences. The Commission therefore concluded that the project's contribution to increasing the share of renewable energies produced in the United Kingdom would outweigh any undue competition distortions brought about by the state aid. (Original version in French by Élodie Lamer)