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FORUM FOR RENEWABLE ENERGY DEVELOPMENT IN SCOTLAND - PROMOTING AND ACCELERATING THE MARKET PENETRATION OF BIOMASS TECHNOLOGY IN SCOTLAND

SECURING A COMPETITIVE ADVANTAGE

International Comparisons

73. The WWF International and Aebiom report, 'Bioelectricity Vision: Achieving 15% of Electricity from Biomass in OECD Countries by 2020' provides detailed information on the use and geographical spread of biomass for electricity and heat production internationally. The International Energy Agency estimates that there was 18.4GW of biomass electrical systems installed in OECD countries in 2000. The bulk of these plants uses forestry and wood processing co-products, and is combined heat and power with the heat used for industrial or district heating purposes. Existing plant is distributed across the three regions of the OECD as follows:-

Source: WWF International and Aebiom, Bioelectricity Vision: Achieving 15% of Electricity from Biomass in OECD Countries by 2020.

74. Forms of support vary, but are generally either based on feed-in tariffs, bidding competitively for premium price contracts or obligation based schemes, such as in the UK. We have in particular looked at the experience of the North Rhine Westphalia region of Germany. That region currently produces 28% of Germany's electricity, 87% of which is from coal fired generation. In 1996, the State Government launched a 'Future Energies' programme to increase the area's use of renewable resources, in particular biomass, and improved energy efficiency. Through this programme, it supports biomass heat and electricity production for a range of uses (including communities, schools, industrial and district heating, and electricity production). It is specifically interested in, and is financially supporting, the creation of wood pellet plant to supply urban projects. Its programme has enjoyed considerable success since its inception, and the area's use of biomass heat and electricity is growing at an impressive rate.

Economic development opportunities

75. Research and evidence from elsewhere suggests that biomass projects provide higher levels of employment, especially during the operations phase, than other mature renewable technologies. The 2004 Renewable Supply Chain Gap Analysis for the DTI, Scottish Executive, Scottish Enterprise, and Highlands and Islands Enterprise, estimates an average of 6 jobs per MW for biomass which compares favourably with other technologies. The FES study and further work undertaken by Avayl Engineering for BEG also considered the economic benefits associated with project development. This work is summarised in Annex D and includes an analysis of employment prospects under different scenarios. Any activities which would increase biomass deployment in Scotland will not only safeguard existing employment in the wood fuel industry, such as forestry operations and fuel transportation but also provide positive opportunities for expansion. This mirrors the findings of the Gap Analysis which suggested that given the fragmented nature of the existing fuel supply chain in Scotland it could provide the greatest economic benefit.

Provision of information to industry

76. One of the major factors inhibiting the development of biomass energy systems is the lack of clear and comprehensive guidance both about how they should be developed and about the financial support available. For example, at the large scale production level, where three industries - growers, processors and energy producers- are involved, the individual needs within the fuel supply chain are seldom understood by any single individual. Unless this problem is tackled, we believe that many potential projects will never proceed.

77. We believe that the industry itself has an important role to play. Representative bodies need to ensure that they co-ordinate learning and information sharing and provide expert advice and information. There is a need for a biomass energy industry network which brings together those working in both the supply and the demand sides, including the responsible public sector agencies. Co-ordination of activity is vital. There is a need to facilitate links between suppliers, processors and generators. BEG believes that the Scottish Renewables Forum (SRF) is in the best position to deliver the leadership necessary to establish a biomass energy network and recommends that it should give urgent consideration to this task.

78. We also believe that there is a clear need for one on one advice. The Forestry Commission has appointed a wood fuel project officer with the remit of providing advice to businesses and potential businesses in the north of Scotland and this appointment is already proving valuable. We recommend that the Forestry Commission consider making similar appointments to cover the rest of Scotland, and that the duties of the post holders be extended to providing advice about the use of a range of biomass fuel sources.

79. If our recommendations are accepted, it will be important to ensure that there are clear links between the industry-led group and the officers working in the field. While the mechanics of this will be a matter for those concerned to determine, there is a model available in the Timber Transport Forum, and we recommend that this is considered by both the SRF and by the Forestry Commission, working in partnership.

80. This two pronged approach - an industry-led biomass energy network overseeing the development of comprehensive data and advice and the appointment of project officers who would deliver that advice - will, we believe:

• create a more unified industry view of wood fuel development requirements;
• ensure a team of informed advisers is created who can share and disseminate best practice;
• provide advisers with the correct tools for the job;
• provide pertinent and accurate investment information;
• ensure that information remains up to date and relevant;
• provide detailed and up to date technical information from both within the UK and overseas;
• promote the use of fuel thus helping meet government targets; and
• Support the development of training packages and help the delivery of training and development needs.

81. BEG's attention has also been drawn to a scheme that has been established in Wales to provide information to the sector there. This scheme is based on leaflet provision and a web-site. BEG believes that a similar scheme could usefully be considered in Scotland; one which would cover all potential participants in both the supply and demand sides of the sector. The provision of such basic information and its delivery format might be a useful early task for the new industry forum that we have recommended should be established.

82. The success of biomass developments in the planning system is to an extent dependent on public acceptance and support locally. There have been relatively few biomass projects in Scotland to date so there is little experience of public attitudes. However, research that has been undertaken elsewhere in the UK suggests that there is a lack of understanding generally about biomass as a renewable energy resource. This needs to be addressed, not least because of the need for public support in securing planning consent for individual projects. A major information campaign about renewable energy and its benefits - Renewable Energy It's Only Natural - is being undertaken on behalf of the Scottish Executive and the Department of Trade and Industry that will include information about energy using biomass. The results of this campaign should be assessed for their effectiveness and , if necessary, further action taken to increase public awareness of the benefits of developing a biomass industry.

Actions

• The Scottish Renewables Forum, working with the Scottish Forest Industries Cluster, the Forestry Commission, Scottish Enterprise and Highlands and Islands Enterprise, should develop a customer industry-led Biomass Energy Network.
• The Forestry Commission, working with the Biomass Energy Network should consider the appointment of wood fuel information officers to provide advice to all who are interested in developing biomass wood fuel opportunities.
• Public awareness and acceptance of biomass as a renewable fuel is crucial. The Scottish Executive should assess the effect of the national information campaign, Renewable Energy It's Only Natural in relation to public knowledge and acceptance of biomass developments and develop a specific campaign to explain, support and reassure on the advantages of biomass energy.

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