The UK Government has announced it that will develop a short-term support mechanism for large-scale biomass generators in the form of a CfD with a generation collar (i.e. a generation volume cap and floor) to be funded by a levy on consumer electricity bills.
The existing government support ends in 2027 and the Clean Power 2030 Action Plan envisages the need for 2-7GW of low carbon dispatchable power, including biomass. As the government doesn't anticipate there being sufficient incentives for generators to continue operating without support and low carbon dispatchable power alternatives are not expected to be widely available by 2030, continued support is deemed necessary to maintain energy system resilience and security of supply.
The eligibility criteria for the transitional support mechanism include:
- generators must be onshore thermal generation projects located within Great Britain (GB) and should have a minimum electricity export capacity of 100 MW;
- primary fuel source must be biogenic feedstock (at least 90%);
- projects should present credible plans to align with the 6th Carbon Budget and demonstrate the potential for achieving net-negative emissions;
- projects must justify the need for transitional support and should not receive other subsidies for the same generation activities.
Given the small number of potentially eligible generators, the government does not plan to run a competitive process to award support to generators. The government will assess generators against the eligibility criteria, value-for-money assessments and sustainability checks.
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