£750M power station project in doubt

£750M power station project in doubt

A £750 million coal to biomass project at Eggborough power station in Yorkshire has been thrown into doubt following a government decision not to include it in the list of low carbon projects to receive an ‘early’ green subsidy.

 

A list of 10 low carbon projects to get subsidies was announced by the Department for Energy and Climate Change on Thursday. Eggborough, which generates 4% of the UK’s electricity, says it may have to close as carbon taxes and new environmental legislation will make the coal fired plant uneconomic and unable to supply to the national grid after 2015.

 

The company planned a £750 million conversion to run its boilers on biomass, wood pellets, but this is not viable without the subsidy. Company chairman Neil O’Hara said the project would have to be reassessed. Eggborough had hoped to receive a subsidy called an ‘investment contract’ which is designed to bridge a gap between new low carbon subsidies called ‘contracts for difference’ (CFD) which were confirmed in the Energy Act, kick in.

 

The Energy Act, which confirms government plans to invest £110Bn in new energy infrastructure, received Royal Assent on Wednesday this week. This investment is heavily weighted towards offshore wind farms and nuclear power stations. 

 

Eggborough was one of 16 projects that qualified for this early subsidy, but the government has decided to subdivide that list by technology type and select a limited number of projects from each of those groups. The list of successful projects includes three offshore wind farms being developed by Dong Energy of Denmark and another power station project at Drax, also in Yorkshire, which is converting three of its six power units from coal to biomass.

 

Eggborough can still qualify for the CFD when the system comes into operation sometime next year, but the company says this might be too late. 

Please rate

Comments 

Name
Email
  Ctrl + Enter

Most Read

CONTRACTOR NAMED FOR £56M RAILWAY STATION PROJECT

CONTRACTOR NAMED FOR £56M RAILWAY STATION PROJECT

A contractor has been named to transform a major railway station in Birmingham. West Midlands Combined Authority has appointed VolkerFitzpatrick to undertake the detailed design and build of the new £56m University Station. University Station in Vincent Drive, Edgbaston, has been earmarked

DfT committs £60m funding for A361 North Devon Link Road

DfT committs £60m funding for A361 North Devon Link Road

The Department for Transport (DfT) has committed £60m in funding for the A361 North Devon Link Road widening project in the South West. Works include widening of three sections of the Link Road, covering 7.5km, to create three traffic lanes, two in one direction and one in the other

Government commits to funding Crossrail completion

Government commits to funding Crossrail completion

The project has been beset by a series of delays and cost overruns, raising concerns over its delivery. The decision to finance the completion of the project was confirmed in the government’s National Infrastructure Strategy, which insists levelling up the rest of the UK should not mean

This website uses cookies to enhance your user experience. By continuing to use this site, you consent to our use of these cookies. See our Cookie Policy.