Ofgem: UK power group Drax does not breach sustainability obligations

By Susanna Twidale

LONDON, 12 March - British energy regulator Ofgem announced on Wednesday that its review of audit reports prepared by KPMG had found no evidence of Drax's breach of sustainability obligations.

Renewable electricity generators can sell certificates of renewable obligation (RO), which they can use to sell to their customers, to energy suppliers.

To qualify for the certificate, biomass power plants must prove that at least 70% their biomass fuel is sourced from sustainable sources.

Biomass power plants that burn wood pellets for electricity have been criticized by green groups for their sustainability credentials.

Ofgem began an investigation in 2023 to determine if Drax had failed to meet the annual reporting requirements of the RO scheme.

Ofgem stated that it had reviewed more than 3,000 documents, and found no evidence to support the claims of sustainability obligations being breached.

Drax stated that the statement from Ofgem shows it meets sustainability criteria.

In an email, a Drax representative said that "the science behind biomass generation is supported" by world-leading climate experts.

The government agreed last month to extend the subsidy scheme, which provides around 6% Britain's electric power, from 2027-2031, but stated that they should only be run when it is truly needed.

Drax paid 25million pounds to Ofgem last year's voluntary redress funds after an investigation revealed that the company had not implemented adequate data governance controls for biomass imported from Canada between April 1, 2021 and March 31, 2022. However, it claimed it did not find any evidence to suggest the biomass failed to meet its sustainability standards. (Reporting from London by Susanna Twiddale, with additional reporting by Pushkala Aripaka in Bengaluru. Editing by Kirby Donovan.)

(source: Reuters)