Energy minister Charles Hendry has given the green light to plans for two new large-scale biomass power stations in Yorkshire and North Lincolnshire.
The proposed Ouse renewable energy plant at Selby and the Heron renewable energy plant at Immingham could each produce 299MW of electricity, enough for more than 500,000 homes.
Consent is a necessary part of the development process for any large (>50MW on-shore) power station under Section 36 of the Electricity Act, but it could be a while before either plant is actually built, according to Drax, the company behind the plans.
“The minister’s announcement confirms that part of the process is now complete. However, any progress with the investment will be dependent on the government’s final decision on the future support levels under the Renewables Obligation,” said Melanie Wedgbury, Drax head of external affairs.
The Renewables Obligation is the main way of supporting large-scale renewable electricity generation. It works by placing an obligation on all licensed electricity suppliers to source a specified and annually increasing proportion of electricity sales from renewables or pay a penalty.
Suppliers meet their obligations by presenting sufficient Renewables Obligation Certificates (ROCs) – energy crops currently receive two ROCs for each megawatt hour of eligible renewable output generated. Where suppliers do not have sufficient ROCs, they must pay an equivalent amount into a fund, the proceeds of which are paid back on a pro-rated basis to suppliers that have presented ROCs.
DECC is expected to confirm new banding proposals by this autumn, although they are not due to come into effect until 1 April 2013 (1 April 2014 for offshore wind), subject to parliamentary and state aid approval.