Low carbon - Drax
A lower-carbon company

We are committed to enabling a low-carbon future by moving away from coal and towards renewable and cleaner fuels. We converted three of our generating units to be powered by sustainable biomass pellets rather than coal and we are now a predominantly biomass-fuelled generator. Our planned rapid response gas plants will play an important role in supporting a flexible, reliable and affordable energy system that can support intermittent, low-carbon wind and solar power generation.

“We have an important role to play in delivering a low-carbon economy as part of the Government’s wider industrial strategy for the country”

— Andy Koss, CEO, Drax Power

Enabling a low-carbon economy

At Drax Group, we have a significant role to play in contributing to lower-carbon energy infrastructure in the UK.

As a major electricity producer, we take our responsibility to protect the environment very seriously. We are committed to managing, monitoring and reducing our environmental impact and the Drax Group environment policy outlines our approach.

We focus our efforts on reducing carbon dioxide (CO2) emissions and are transitioning away from coal to sustainable biomass sources and lower-carbon gas. Our B2B Energy Supply businesses, Haven Power and Opus Energy, offer renewable energy and are therefore helping customers to reduce their greenhouse gas (GHG) emissions.

Our position on climate change

Energy production is a key contributor to the UK’s CO2 emissions. We have a significant role to play in the transition to a low-carbon future and in helping the UK meet its legally binding climate change targets. We are determined to continue to reduce our carbon emissions while providing the power the economy requires.

Risks and opportunities

Climate change poses both risks and opportunities for Drax Group. To reduce the risks to our business, we are committed to reducing our operational carbon emissions and emissions from our supply chain by transitioning away from coal and using sustainable biomass, as well as investing in lower-carbon energy sources such as Open Cycle Gas Turbine (OCGT) generation plants. We are also exploring innovative battery technology.

We are enabling the use of solar and wind energy, with our biomass and potential gas and battery storage, all supporting the capacity and stability of the UK energy grid, providing services such as voltage control, frequency response and inertia.

We recognise that investors and other stakeholders increasingly require clear information about the climate change risks to our business. This will increase with initiatives such as the Financial Stability Board’s (FSB) Task Force on Climate-Related Financial Disclosures (TCFD) recommending greater disclosure of the specific financial risks of climate change. We are fully committed to transparent disclosure of climate-related information, and we are pursuing opportunities to participate in sustainability ratings and rankings.

Support for carbon pricing

In October 2017, Drax joined with other companies and non-governmental organisation NGOs in a letter to the UK Chancellor, encouraging him to back the Carbon Price Floor beyond 2020. We welcomed the Government’s Clean Growth Strategy to ensure that a green economy and energy are at the heart of the UK’s industrial strategy. We believe a continued commitment to carbon pricing will provide certainty for businesses investing in lower-carbon and renewable capacity, and incentivise the development of new lower-carbon technology.

Reducing our carbon emissions

Our performance in 2017

We calculate and report our carbon emissions in accordance with the Companies Act 2006 and the European Union Emissions Trading System (EU ETS), as disclosed in Table 1.

Table 2 shows our emissions from biologically sequestered carbon which includes emissions released through the combustion of biomass to generate electricity. The emissions data do not take into account the CO2 that has been absorbed from the atmosphere during the growth of feedstocks which are used to manufacture the biomass pellets used at Drax to generate electricity.

The biogenic CO2 emissions resulting from power generation are counted as zero in official reporting to both UK authorities and under the EU ETS as the use of sustainable biomass is considered to be carbon neutral at the point of combustion. This methodology originates from the United Nations Framework Convention on Climate Change (UNFCCC).

The majority of our emissions result from the process of using solid fuel. This can make it difficult to identify other smaller trends that are still significant. To counteract this dominance and to ensure we retain a balance between highlighting significant developments and providing meaningful data, we have adopted a materiality threshold of 100,000 tonnes of CO2.

In Power Generation, our carbon emissions from coal have significantly declined since 2013 as we have increased our biomass generation. In 2017, our electricity generated from sustainable biomass was 13TWh, an increase of 300MW from 2016.

However, in 2017 our Scope 1 fossil fuel combustion emissions have increased by 2%. This can in part be attributed to the fire at our Power Generation biomass rail unloading facilities in December, which caused an unplanned outage at two of our biomass units.

Table 1: Fossil fuel, operations and purchased electricity emissions

ActivityUnit of measure20172016201520142013
Total Scope 1 and 2kt6,2966,17213,31716,84420,612
Scope 1
Fossil fuel combustionkt6,1696,02113,10116,47620,162
Operationskt<100<100<100119157
Total Scope 1kt6,1696,02113,10116,59520,319
Scope 2
Purchased electricitykt127151216249295

Table 2: Biologically sequestered carbon (biomass combustion) emissions

ActivityUnit of measure20172016201520142013
Biologically sequestered carbon
(biomass combustion)
kt11,76611,45510,2387,1502,799

Table 3: Total emissions per GWh of electricity generated by fossil fuel combustion

ActivityUnit of measure20172016201520142013
Gross generationTWh21.220.828.128.528
Emissions per GWh of electricity generatedt/GWh297297474591736

Haven Power has set a carbon usage target for its employees and is also working with contractors to implement better ways of working that can help reduce its carbon footprint further. Haven Power engages employees on energy efficiency and gathers feedback through dedicated “energy champions”. The “Watts your lowdown on carbon” competition has been running since December 2016 and encourages Haven Power employees to submit their energy and cost-saving tips for the business.

See how Opus Energy and Haven Power encourage customers to reduce their carbon emissions through renewable energy offerings.

Biomass supply chain emissions

We monitor every step in the supply chain to ensure that our sustainability standards are being met and that greenhouse gas (GHG) emissions associated with producing our biomass are calculated according to the regulatory requirements.

Emissions from each stage and in each different supply region are calculated and reported. The Renewables Obligation sets out the basis on which Drax is required to determine and report on the life cycle GHG emissions associated with its supply chain. Every supplier is required to give detailed information on what type of fibre is used to make wood pellets along with full details of their sources, the distances and vehicle types involved in their production, the production process itself, data about fuel and energy usage, plus any sea freight data (including what type of vessel was used, over which route, and over what distance). GHG calculations are carried out for all material consumed by us using the UK Solid and Gaseous Biomass Carbon Calculator which uses the methodology prescribed in the EU Renewable Energy Directive, which is reported each month to the Office of Gas and Electricity Markets (Ofgem).

GHG emissions are affected by a wide range of factors including cultivation, harvesting and transportation. The majority of our pellets are shipped to the UK from North America. The most significant GHG impacts in the biomass supply chain are the electricity used in pelletisation and the sea freight emissions in transport.

The impact of shipping emissions is determined by both distance and vessel size. For longer distances (e.g. from North America) it is essential to use large-scale vessels capable of transporting more than 40,000 tonnes of wood pellets (sometimes up to 60,000 tonnes); this significantly reduces the emissions per tonne of wood pellets. Within Europe, shipping distances are much shorter and therefore smaller vessels can be utilised, which allows vessels to access small ports that can reduce inland transportation.

Drax uses specially designed rail wagons to transport the biomass pellets direct from port to the power station. This is dramatically more carbon efficient than road transport. Pellet mills are ideally located close to the forest resource and close to ports in order to minimise inland transport emissions.

The UK Government has set a limit on the maximum supply chain GHG emissions permitted in order for biomass to be eligible for support under the Renewables Obligation. The current limit for CO2 emissions from life cycle analysis of biomass supplies is 79.2g CO2/MJ – reducing to 50g CO2/MJ by 2025.

View in kWh

In 2017, the average supply chain greenhouse gas emissions from all of Drax’s biomass supplies amounted to 36g CO2/MJ. The UK Government has provided a benchmark figure for GHG emissions from coal which is 256.94g CO2/MJ; therefore, in the 2016-17 compliance year, Drax saved approximately 86% of CO2 emissions compared to the coal benchmark.

 

Looking ahead
  • Develop our Group-wide climate change policy