The Renewable Energy Association (REA) has said there is “huge potential for growth” in biomass due to its popularity through the Renewable Heat Incentive (RHI) and decreasing costs of importing technology from Europe.
Analysis by the Department of Energy and Climate Change (DECC) has revealed that biomass schemes accounted for the vast majority of non-domestic installations made under RHI.
Most non-domestic RHI applications – 87% of the 11,624 applications from November 2011 to December 2014 – are for small solid biomass boilers for the agricultural and commercial sectors.
Due to its popularity, the biomass subsidy was reduced through the ‘degression’ mechanism three times during 2014.
A report for DECC by the Eunomia consultancy also revealed that the UK could benefit from buying biomass technology from EU countries that already have a mature market, such as Austria, Denmark and Germany.
In a further report for DECC, consultants Ricardo indicated that the UK had the potential to generate 276TWh of heat a year for biomass district heating schemes.
But the potential figure for such schemes was estimated to be just 3TWh a year because waste incinerators tend to be situated too far from housing.
Frank Aaskov, REA policy analyst, said: “There is always room for improvement, both in the RHI and within the sector, but it is clear that biomass and wood heating is a modern and mature technology that has huge potential for growth.
“We hope this is reflected in the Government’s reform of the RHI, when this consultation is launched later this quarter.”
RHI subsidies, which are paid to owners of approved green energy schemes, were introduced in 2009. They led to rapid growth in the biomass market, and stimulated combined heat and power (CHP) and biomethane schemes.
Chancellor George Osborne announced on 25 November in his comprehensive spending review an increase to £1.15bn RHI funding by 2021, up from £430m for 2015-16. The Anaerobic Digestion & Bioresources Association said this could lead to an additional 140 biomethane plants being built, a fourfold increase.
Energy minister Lord Bourne said: “Reforming how we use energy for heating is critical to achieving secure, affordable and clean energy for families and businesses across the country.
“That is why the Government will be pushing a more cost-effective, targeted RHI scheme for the next five years.”