Tag Archives: emission
Carbon Emission Costs Eat Into Profits At Power Supplier Drax
COAL-fired power producer Drax posted a fall in half-year profit yesterday, as the company began paying a Government-imposed minimum price for carbon. It said earnings for the first half of the year fell 22 per cent, as it converted one of its generation units to biomass and the costs of emitting carbon more than doubled. For the first time, Drax, which is based near Selby, has been fully exposed to prices for European Union carbon permits, which most EU utilities must pay for in full in the current 2013-2020 phase of the emissions trading scheme. Drax, the operator of one of Europe’s largest coal-fired power stations, must also pay an extra carbon cost imposed by the Government in April. It said earnings before interest, tax, depreciation, and amortisation (EBITDA) fell to £120m ($184m) for the six months ended June 30, down from £154m a year ago. “We are investing significant capital this year and next to transform our business, with earnings during this period impacted by the increasing costs of carbon,” chief executive Dorothy Thompson said. Drax said it had to pay £70m for EU carbon allowances through the emissions trading scheme, which ended free allocation to utilities in its current phase, almost double the £38m it had to pay last year for the permits. Meanwhile, a carbon floor price introduced by the Government on April 1 cost Drax £14m up to the end of June, the company said. The current tax, at £4.94 per tonne, is in addition to each power firm’s obligation under the EU carbon market, and is set to rise to £9.55 next year and £18.08 in 2015. The power generator spent £138m in the first half of the year on fixed assets, up from £90m a year ago, mainly for facilities to ship and store wood pellets. Drax plans to convert a second 660MW unit to biomass next year, with a third possible in 2017, depending on Government incentives and the availability of wood that can be certified as sustainable. However, the extra costs of carbon and infrastructure were offset partly by lower costs for coal, driving down fuel costs. Shares in Drax rose yesterday as investors responded calmly to the fall in profits, which was in line with the company’s expectations. Drax said it hoped to increase the amount of electricity generated by its converted biomass unit, which only operated at 57 per cent of capacity due to disruption in wood pellets supply. It said the investment in permanent transport and storage facilities would ensure a steady flow of supply of biomass which is sourced mainly from North America and eastern Europe. Wood pellets have to be moved in much bigger quantities than coal, which has prompted Drax to build large inflatable domes at its power station to store biomass. greg.wright@ypn.co.uk Continue reading
"Biofuels Should Deliver Greenhouse Gas Emission Cuts And Not Compete With Food"
Transport / Environment − 10-07-2013 – 15:31 Corinne Lepage Fuel from food crops have been pitched as a way to reduce carbon emissions from transport, however questions have been raised about how green these biofuels really are. The EU has supported them for the last 10 years, but last year the Commission proposed to limit the amount of food-based biofuels. We asked Corinne Lepage, a French member of the ALDE group in charge of steering the fuel quality and renewable energy directives through EP, about the challenges posed by biofuels. According to Ms Lepage,the promotion of the first generation of biofuels from food crops such as rapeseed and palm oil affected developing countries by pushing up food prices. In addition land needed to be converted for biofuels production, leading to the destruction of forests and wetlands. As a result these biofuels actually generated more CO2 than they saved. “The cap on first generation biofuels is needed, but not in an indiscriminate way as the Commission proposed,” Ms Lepage said. She urged to distinguish between better and worse–performing food–based biofuels by including emissions related to the change of land use in the calculation of greenhouse gas emissions savings attributed to biofuels. This would stimulate the production of biofuels such as ethanol that do provide substantial benefits for the climate. She reminded that Parliament had already called in 2008 for these factors to be included in the calculation. “Ignoring this problem risks undermining the EU’s credibility in the fight against climate change and legitimacy of financial support [of about €10 billion per year from EU member states’ budgets ] to the industry,” she said. Ms Lepage said the current insistence on austerity might make it difficult to justify high subsidies until 2020, but added: “The existing investments should be protected and the industry should have several years to continue producing first generation biofuels to recoup investments and prepare for the swtich to advanced biofuels.” These advanced biofuels could come from non–food sources, such as waste or residue feedstock. The environment committee will vote on the proposals on 11 July and the plenary vote is due to take place on 10 September. REF. : 20130708STO16803 Continue reading
Biofuel Development Key To Meet California’s GHG Emission Reduction Goal
11 Jun 2013 Biofuel development could be the answer for California to meet its 2050 greenhouse gas emission reduction goal, according to a new report that focuses on the state’s biofuel potential. The report titled “California Energy Future: The Potential for Biofuels,” done by the California Council on Science and Technology, co-authored by Heather Youngs and Chris Somerville, concluded that developing the potential for next-generation biofuels can help reduce greenhouse gas emissions, specifically, replacing the use of gasoline with cellulosic ethanol and biodieasel. However, replacing gasoline with conventional cellulosic ethanol and biodiesel can only reduce California’s emissions by as much as 53 percent of the 80 percent GHG emissions reduction goal. In order for the state to meet its target, the report suggested developing other alternatives to fossil fuel such as low-carbon lignoecellulosic ethanol or biomass derived from hydrocarbons and a reduction in the overall demand for fuel. The authors of the report cautioned that even with optimistic efficiency, electrification, the use of other renewable energy sources, the use of extensive amounts of low-carbon biofuels is still needed. That is why when it comes to the issue of using vast amounts of biomass to power the state; the authors explained that “sustainable resource management” and “judicious use of feedstocks” is needed to fully maximize the resource. Currently, California is targeting 75 percent of its biofuels from its state resources. According to Ms. Youngs, reaching the 75 percent goal can be met by importing biomass from countries like Brazil, of which will then be used to supply the state’s biorefineries, however, this would prove very costly. The target of reducing GHG emissions by 80 percent from 1990 levels by 2050 comes from the State Executive Order S-03-05 that was signed by then governor Arnold Schwarzenegger back in 2005. With such a timeframe, Ms. Youngs believes that technologies can be deployed to produce low carbon biofuels by then, but this deployment of technologies will still have to depend on factors such as biomass supply and economic considerations. In another report also done by the California Council on Science and Technology, titled “California’s Energy Future – The View to 2050,” it was found that i to make a mark on the 2050 GHG emissions goal would require different strategies. The strategies in the report were stringent efficiency measures; avoiding the use of fossil fuel through electrification; doubling the use of electricity produced from renewable energy and other sources as well as storing carbon dioxide emissions underground; and getting enough supply of low-carbon fuel. – EcoSeed Staff Continue reading
