The UK Government's new Green Investment Bank in Edinburgh is facing its first protests for backing the burning of millions of tonnes of wood from abroad in power stations.
MSPs from three political parties, environmental groups and community representatives have written to the bank this weekend saying they are "deeply concerned" that it is supporting big biomass plants. Demonstrations are also planned at its annual meetings in Edinburgh and London this week.
The bank has loaned £50 million to help the UK's largest power station, Drax in North Yorkshire, switch from burning coal to burning wood. But critics say this will mean having to import up to 15 million tonnes of trees a year from North America and is a "false solution" to climate pollution.
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There are also fears that the bank could rescue floundering plans for wood-burning plants at Grangemouth and Rosyth. The controversial proposals have planning permission, but the developers, Forth Ports and the energy company SSE, pulled out in March.
A joint letter to the bank signed by 18 organisations and individuals says that backing polluting biomass plants undermines the bank's credibility as an environmentally responsible investor. It urges the bank to revoke its loan for Drax, and rule out financial support for plants at Rosyth and Grangemouth.
The letter was coordinated by the campaign group, Biofuelwatch, which argues that big biomass plants will make climate pollution worse, not better. "There's an emerging scientific consensus that burning wood in power stations emits vast quantities of carbon dioxide, and is no cleaner than the fossil fuels that it is supposed to replace," said the group's co-director, Oliver Munion.
"With evidence that the wood-pellet industry is exacerbating forest destruction in North America, and the fact that plants like those planned in Grangemouth and Rosyth will cause air pollution locally, big biomass cannot be considered renewable energy and should not play a part in Scotland's energy mix."
Munion warned that the two Scottish plants were still eligible for lucrative subsidies and could "fit the bill for a Green Bank loan".
It was "pretty shocking" that an organisation that described itself as green was backing big biomass at Drax, he said. The joint letter to the bank is supported by Angus MacDonald, the Nationalists' MSP for Falkirk East, who has opposed the proposed Grangemouth plant.
"The Green Investment Bank should not be hauled in to support the project," he said.
"It doesn't stack up financially and the importation of virgin wood would create an unsustainable bioenergy industry, risking serious damage to wildlife and the climate," he added. "I would be content to see the project die a death - this is not green energy."
Another signatory, the Green MSP Alison Johnstone, described felling swathes of foreign forest to burn in Scotland as "plain daft". She added: "Big biomass shouldn't be on the Green Investment Bank's books."
The letter has also been backed by the Labour MSP Malcolm Chisholm, Friends of the Earth, the World Development Movement, Scottish Education and Action for Development and local residents.
"Big biomass is bad for carbon emissions and unjust to communities at home and abroad," said Eurig Scandrett, chair of Friends of the Earth Scotland.
The Green Investment Bank was set up with £3.8 billion by the UK Government in 2012. Since then it says it has backed 28 green infrastructure projects in the UK, committing more than £1.3bn of capital.
According to its group operations director, Rob Cormie, it was helping the UK make the transition to a green economy. "Sustainably sourced biomass can have a role to play as part of our energy mix as we make that transition," he said.
"Before the bank commits to any project it must pass a rigorous green assessment process. Our role as a commercial investor means that it would be inappropriate for us to comment on individual projects, whether we are involved with them or not."
The bank originally agreed a loan to Drax of £100m, but this was halved after other investors pitched in last year. An insider suggested that it was "not in active discussions" on the Grangemouth and Rosyth proposals.