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Tide turns against docks plan to branch out into wood power

Controversial £1.7 billion proposals by Forth Ports and Scottish & Southern Energy to build four ­woodchip-burning power plants may be in danger of being rejected after several Scottish Government ministers appeared to speak out against them.

Joint venture Forth Energy’s plans to build the 120MW biomass electricity plants in Edinburgh, Grangemouth, Dundee and Rosyth, to be formally proposed to the government for consent in the coming weeks, have been undermined by statements to wood suppliers by environment secretary Richard Lochhead and environment minister Roseanna Cunningham.

Lochhead told a conference organised by the Confederation of Forest Industries (ConFor) several weeks ago: “The Scottish Government is keen to see Scottish-produced biomass utilised mainly for heat-only or for combined heat and power plants ... In terms of scale, we want to encourage new biomass plants that are relatively small in scale, in order to both optimise local supply and to serve localised heat markets.”

Cunningham made a similar statement to the same organisation last week, adding that wood-burning should be done as efficiently as possible. This has been interpreted as backing a campaign by ConFor’s members for wood to be burned for heat and not electricity as it is three times more efficient.

If the venture fails to get permission for the plants it will be particularly bad news for Forth Ports, which narrowly avoided being taken over recently and is battling to reinvent its docklands assets. The four docks are attractive sites as their deep waters would allow ships in with large amounts of wood.

The comments are also a potential concern for the biomass and coal-burning plant being proposed by Ayrshire Power, a consortium of Dong Energy and Peel Group, for a site at Hunterston.

The Forth Energy plants have been a public relations disaster since they were unveiled last August. Many of Leith’s residents are vehemently opposed to the prospect of a large plant with a 100m chimney close to residential areas, fearing it could wreck plans to bring a giant ferris wheel to the area as a tourist attraction

They also fear its impact on the skyline and possible pollution, although the plant will have much lower carbon emissions than fossil-fuel alternatives. Campaigners have been publicly backed by SNP politicians including justice secretary Kenny MacAskill. He has been speaking in his capacity as MSP for Edinburgh East and Musselburgh, but it has added to the sense that the government is not well disposed to the proposals.

Wood suppliers are worried the proposals will severely damage the market for their products. Although they are likely to push up the price of wood in the short term, they fear this will make the commodity uneconomical for their other customers.

This would potentially make suppliers increasingly dependent on biomass customers, who might take advantage of their market dominance to drive down prices in a similar way to the supermarkets’ dealings with farmers. Each of the Forth Energy plants propose to burn 1.3 million tonnes of biomass each year.

Stuart Goodall, chief executive of ConFor, acknowledged that Forth Energy was proposing to obtain 70% to 90% of its woodchips from abroad, but believed that this would be difficult to achieve in the long term.

He said: “According to a recent study that we commissioned … the biomass plants being proposed for the UK will mean about 27 million tonnes a year of demand for wood. That’s the current global trade in wood, so it would mean that we would have to capture the whole market. There are a lot of companies that have unrealistic expectations.”

He added that ConFor preferred to see wood-burning demand coming from smaller community or residential boiler projects.

A Forth Energy spokesman said its plans for four plants in Scotland could deliver 14% of the country’s electricity.

He said: “We appreciate there are critics of the projects but would put forward that the Scottish Institute of Sustainable Development carried out a ‘life-cycle’ carbon footprinting study of the proposed renewable energy plants, taking into account the production, processing and transport of fuel from Europe and North America. The study demonstrates around a 90% reduction in carbon emissions as a result of the development.”

A spokesman for the Scottish Government said every biomass application would be considered on its own merits.

Biomass plants being proposed for the UK will mean about 27 million tonnes a year of demand for wood. That’s the current global trade in wood

Stuart Goodall, chief executive of ConFor

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