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Home › Dodgy Deals ›
Dodgy Deal
Drax Repower projectUnited Kingdom

Project – On record

This profile is no longer actively maintained, with the information now possibly out of date
Contact:

Frances Howe, Biofuelwatch UK, (+44) 792 811 3194

Last update: 2020-02-03 00:00:00
The four eastern cooling towers at the Drax power station in North Yorkshire. Photo: Jonathan Brennan via Flickr (CC BY-SA-ND)

Project – On record

This profile is no longer actively maintained, with the information now possibly out of date
Contact:

Frances Howe, Biofuelwatch UK, (+44) 792 811 3194

Last update: 2020-02-03 00:00:00
Why this profile?

Why this profile?

The UK government has committed to phasing out coal by 2025. It is vital that, in this phase out, coal is not simply replaced with gas, another fossil fuel, or biomass, which at this scale will have disastrous consequences for the climate and biodiversity. Converting Drax Power Station from coal to gas will lock the UK into another generation of fossil fuel dependence.

What must happen

Banks should not invest in a project that is so harmful to the climate, biodiversity and communities. To have any chance of staying below 1.5 degrees of global warming, we need a massive reduction in our energy demand and a widespread switch to no-burn renewables – not an expansion of polluting fossil fuels. Instead of converting to other forms of polluting power, Drax needs to be shut down and replaced with genuine renewable alternatives.

About
Sectors Gas Electric Power Generation
Location
Status
Cancelled
Design
Agreement
Construction
Operation
Closure
Decommission
Website http://repower.drax.com/

The Drax Repower project is a proposed partial rebuilding of the existing Drax Power Station (run by Drax plc) which runs on biomass and coal. The proposal is to rebuild its final two coal-burning units to run on gas instead of coal. This will follow the conversion of the other four units to run on biomass from imported wood. If the project goes ahead Drax Power Station will become the UK’s largest gas-fired power station, with a capacity of 3.6 gigawatts, as well as the world’s largest biomass burner.

Impacts

Social and human rights impacts

The majority of the wood pellets that provide fuel for Drax's biomass units (59%) are sourced from biodiverse forests in the southern United States. The pellet mills have a large impact on the local communities -besides the loss of local forests- through air pollution, wood dust, noise and heavy traffic. Wood pellet production facilities release fine particulates, nitrogen oxides, carbon monoxide, and volatile organic compounds in the air. Pellet mills and export facilities are often located in poor, largely African-American, neighbourhoods, contributing to existing environmental injustice.

A recent study by the Environmental Integrity Project discovered that wood pellet facilities in the US regularly breach air quality legislation, with over half of wood pellet plants either failing to keep emissions below legal limits or failing to install required pollution controls. One third had violated their permits in 2017 by releasing illegal amounts of air pollution. As the largest single customer of wood pellets from the region, Drax is contributing to this pattern of environmental negligence and its consequent impacts on public health.


Environmental and climate impacts

Impacts of the gas units Although the Drax Repower project involves a shift from coal to gas, it will lead to an expansion of the power station’s capacity and its greenhouse gas emissions. Drax admits in its Preliminary Environmental Information Report that the conversion of burning gas at the power station will “represent a significant net increase in greenhouse gas emissions and have therefore negative climate impacts." This is likely to mean Drax will remain the UK’s single largest emitter of carbon dioxide.

Although fossil fuel gas emits less air pollutants and CO2 than coal, it is far from clean. Studies suggest that it may have the same level of greenhouse gas emissions as coal once methane leakage from pipelines and wells are factored in. Drax has said the new units will be ‘carbon capture ready’, however there are no clear plans to capture carbon. Building new gas power capacity is likely to drive demand for fracking, a highly polluting and unpopular process.

The Paris Climate Agreement countries have committed to curbing temperature rises to "well below" 2C above pre-industrial levels and to pursue efforts to keep them to 1.5C to prevent dangerous climate change. New fossil fuel based power generation projects like Drax Repower are incompatible with this target.

Drax’s plan to replace coal with another fossil fuel is contrary to the UK's goals for decarbonising its power sector by 2030, particularly since Drax has said that repurposing two coal units to burn gas will “extend their operation into the 2030s.”

Impacts of the biomass-fired units The Drax Repower project only concerns the conversion of Units 5 and 6 of Drax Power Station to gas. However banks financing this conversion should also be aware of the impacts of the conversion of Units 1 - 4 to run on biomass.

Drax's main supplier for wood pellets is Enviva (US). Conservation NGOs such as Dogwood Alliance and Natural Resources Defense Council (NRDC), as well as journalists, have documented how Enviva is sourcing wood for pellet plants from the clearcutting of highly biodiverse coastal wetland forests. The impacts of biomass energy depend both on the sourcing of the biomass and, even more importantly, on the scale. Burning biomass will always emit carbon into the atmosphere, especially for an inefficient power station such as Drax. Biomass power stations emit a similar range and volume of air pollutants as coal power stations.

 

 

Financiers

According to Drax's 2018 funding statement the project's total costs are GBP 600 million. This will be financed through equity and debt. Barclays is likely to advise Drax on financing the project (see 3.3.3. of the funding statement).

Institution type
Finance type
Year
Companies

Drax Group

United Kingdom
Profile
Website
No companies
News
BankTrack
Partners
Blog
External
BankTrack news BankTrack blog Partner news Partner blog

Green activists target Drax investors

Environmentalists target North Yorkshire power station owner's £226m takeover of Canada's Pinnacle Renewable Energy
2021-03-23 | Telegraph
BankTrack news BankTrack blog Partner news Partner blog

NEW INVESTIGATION: UK’s Drax bid to buy Pinnacle could turn some of last remaining primary forests in Canada into wood pellets, putting species and the climate at further risk

New maps show critical primary forests and endangered species in British Columbia overlap with pellet facility wood sourcing across an area equivalent to 1.4 million soccer fields
2021-03-23 | Stand.earth
BankTrack news BankTrack blog Partner news Partner blog

The problem with biomass: Why investors need to step up on the next climate challenge

2020-04-21 | ShareAction
Blog
BankTrack news BankTrack blog Partner news Partner blog

Climate and forest campaigners call on BlackRock to divest from wood-burning energy

2020-03-23 | London, UK | Biofuelwatch
BankTrack news BankTrack blog Partner news Partner blog

Legal challenge launched against plans to build Europe's biggest gas plant in Yorkshire

2020-01-30 | BusinessGreen.com
BankTrack news BankTrack blog Partner news Partner blog

Climate campaigners denounce approval of UK’s biggest ever gas project

2019-10-04 | Biofuelwatch
BankTrack news BankTrack blog Partner news Partner blog

New UK gas power station 'would breach climate commitments'

2018-11-11 | The Guardian
BankTrack news BankTrack blog Partner news Partner blog

Decision on major Drax Power Station plans 'to be made in 2019'

2018-07-01 | The Hull Daily Mail
BankTrack news BankTrack blog Partner news Partner blog

Drax hit with a double environmental protest

2018-04-25 | Energy Live News
BankTrack news BankTrack blog Partner news Partner blog

Don’t believe the hype: Biomass is an environmental disaster

2018-04-17 | Redpepper.co.uk
BankTrack news BankTrack blog Partner news Partner blog

Burning wood for power is ‘misguided’ say climate experts

2017-12-31 | The Guardian
BankTrack news BankTrack blog Partner news Partner blog

Drax power station emissions 'dangerous', claim environmentalists

2017-08-17 | BBC News
BankTrack news BankTrack blog Partner news Partner blog

No Drax! There's nothing 'sustainable' about big biomass

2017-04-10 | The Ecologist
BankTrack news BankTrack blog Partner news Partner blog

Protesters criticise Drax over use of subsidies for coal and wood power

2016-04-20 | The Guardian
Resources
Documents
Images
Links
2022-10-21 00:00:00

Burning forests in the name of clean energy? How banks are failing to exclude the harmful wood biomass industry from finance

BankTrack publication
2022-10-21 00:00:00 | BankTrack
2021-04-09 00:00:00

Joint Civil Society letter to Shareholders of Drax Group PLC about the proposed acquisition of Pinnacle Renewable Energy Inc

Recommendation: Vote AGAINST the resolution to approve the acquisition of Pinnacle Renewable Energy Inc by Drax Canadian Holdings Inc an indirect wholly owned subsidiary of Drax Group PLC.
NGO document
2021-04-09 00:00:00 | Stand.earth
2020-02-29 00:00:00

Briefing: why Blackrock should divest from biomass

NGO document
2020-02-29 00:00:00 | Biofuelwatch
2018-11-20 00:00:00

Last Gasp - The coal companies making Europe sick

NGO document
2018-11-20 00:00:00 | Climate Action Network Europe
2018-04-26 00:00:00

Dirty Deceptions: how the biomass industry skirts the Clean Air Act

NGO document
2018-04-26 00:00:00 | Environmental Integrity Project
2016-09-21 00:00:00

A bridge to nowhere: methane emissions and the greenhouse gas footprint of natural gas

Other document
2016-09-21 00:00:00 | Energy Science & Engineering Dep. of Cornell University
2018-06-30 00:00:00

Debunked: the G20 clean gas myth

NGO document
2018-06-30 00:00:00 | Oil Change International et al
2018-05-31 00:00:00

Funding statement Drax Repower project

Company document
2018-05-31 00:00:00 | Drax
2018-02-27 00:00:00

Drax Annual Report 2017

Annual report
2018-02-27 00:00:00 | Drax
2018-01-31 00:00:00

Preliminary environmental information report

non-technical summary
Company document
2018-01-31 00:00:00 | Drax
2018-01-24 00:00:00

Drax's new gas plans: bad new for the climate

NGO document
2018-01-24 00:00:00 | Biofuelwatch

Protests against Drax power station

2018-06-11
Protest against the Drax power station Protest against the Drax power station Protest against the Drax power station Protest against Drax power station

Project website

Drax's new gas plans: bad climate news

Drax - Ten years on

Biofuelwatch #AxeDrax campaign page

Drax's webpage on corporate social responsibility

ClientEarth

Updates

2021

2021-02-25 00:00:00 | Drax cancels Repower project

Following ardent campaigning by environmental groups, Drax cancelled plans for massive gas-fired power plants.

2020

2020-01-30 00:00:00 | Legal challenge against Drax Power

ClientEarth has launched a High Court challenge against the UK government's decision to greenlight what would be Europe's largest gas power plant, sparking the latest legal test for the UK's decarbonisation strategy (BusinessGreen.com).

2019

2019-10-04 00:00:00 | Drax Repower project receives Development Consent Order

In October 2019 the Drax Repower project received a Development Consent Order (DCO). When developed, up to 1,800 megawatts (MW) of new capacity would be available from October 2023 for the Drax power plant (Drax press release).

2018

2018-11-11 00:00:00 | ClientEarth has submitted an objection to Drax Repower Project

Plans to build a huge new UK gas power station are facing a challenge from an environmental law group that argues the project would breach the government’s recommendations on climate change. ClientEarth, which has repeatedly defeated the government in court over its air pollution strategy, has submitted an objection to the planning inspectorate over Drax Group’s proposed 3.6GW plant in North Yorkshire. Read more here.

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