Biomass action plan for Scotland

5. BIOMASS HEATING

CONTEXT

5.1 Around a third of Scotland's primary energy consumption is for heat and although only a small percentage is currently generated by biomass this is a rapidly developing market. Current woodfuel usage is estimated to be around 300,000 oven dried tonnes (odt) per year at the start of 2006, an increase of 117% over the previous year. However, it should be noted that a large proportion of this usage is imported pellets which are used for co-firing to generate electricity. In contrast, of this total, heat production currently uses around 121,000 odt per year of virgin wood and recycled timber in larger scale (>1,000 odt per year) industrial installations.

5.2 At the start of 2006, around 4,400 odt per year of wood fuel were being used in small-medium scale (<1,000 odt per year) installations, an increase of 9% over the previous year. The number of small-medium scale heat only installations has increased rapidly over recent years with a total installed capacity of over 8 MWth across 42 projects, including 5 operational woodfuel district heating schemes. Although the local heat only sector comprises only around 2% of the current biomass use, it has the potential for significant expansion and brings many local rural diversification benefits. The main limiting factors to the further expansion of this sector are equipment capital costs and the availability of trained professionals and accredited installers.

5.3 Forestry Commission Scotland estimate that around 50,000 odt of traditional wood fuel in the form of logs are used in domestic properties for traditional fires or log burners. However, this sector is also modernising its demands and efficiencies through the use of new, automated systems to provide clean and convenient domestic heating. Wood fuel pellets also offer a clean and practical alternative to traditional fossil-fuelled systems. The main limiting factor for the growth of this domestic market sector (aside from those already listed) is the lack of pellet production in Scotland. However, the recently announced proposal by Balcas to build a wood fuel pellet manufacturing facility at Invergordon with support from Highlands and Islands Enterprise, and several projects in development will help to provide a Scottish source of pellets in the near future.

SUPPORT MEASURES

5.4 The Executive is taking action on a number of fronts to develop biomass heat:

Renewable Heat Strategy

5.5 The Executive has made a commitment to produce a Renewable Heat Strategy by the end of 2007. The overall aims of the strategy will be: to maximise the potential of the full range of Scotland's renewable resources; to grow the economy; to contribute to Scotland's Climate Change Programme; and to strengthen energy supply security by ensuring a vibrant market is developed for renewable heat in Scotland. The strategy will lay down targets for production of renewable heat for the period until 2020 and explain how progress towards these targets will be monitored.

Information Provision

5.6 Awareness-raising and promotion of the benefits of biomass are essential to create a flourishing biomass industry. The Executive is supporting the provision of information at all levels from public awareness to professional training through a range of measures.

5.7 The Executive recently launched a one-stop shop website for woodfuel information (at www.usewoodfuel.co.uk) which contains a range of information for domestic, commercial and industrial users of woodfuel. The website is also developing a series of case studies to share experiences and best practice. This website links into the DEFRA Biomass Energy Centre website ( www.biomassenergycentre.org.uk).

5.8 Advice and support on biomass is available from a range of sources. Forestry Commission Scotland has a network of Woodfuel Information Officers who are providing advice and information to a range of organisations and individuals on installations and supply. The network (full contact details at Annex E) has been extended with the appointment of an officer in South Scotland, to share best practice and experience across the whole of the country.

5.9 In May 2006, the Executive published an Annex to Planning Note ( PAN) 45 on microrenewables. This document helped increase awareness of the various technologies available and paragraph 6 provides advice to developers, planners and communities on micro biomass schemes. This supplemented the earlier advice in PAN 45 on other larger scale biomass technologies.

5.10 The network of Scottish Community and Householder Renewables Initiative ( SCHRI) Development Officers (full contact details at Annex E) is a useful source of information and advice for a whole range of renewable technologies, including biomass. The network covers the whole of Scotland.

5.11 The renewables sector has also worked on strengthening the presence of the biomass industry in Scotland. The Scottish Renewables Forum Bioenergy Network ( BEN) provides a focus for industry discussion and lobbying on biomass. The Executive supports a post to co-ordinate the work of the BEN.

Regional View

5.12 Regional level advice and support is available from a number of sources, although it varies considerably between regions:

• in Argyll, ALIenergy has developed a high level of expertise in biomass through hands-on involvement in a number of projects;
• the Lanarkshire Biomass Group provides local advice and support, promoting and disseminating information to build on the North Lanarkshire biomass projects; and
• Highland Birchwoods has developed a considerable knowledge base through projects such as the Northern Woodheat and North Sea Bioenergy projects, both EU funded with a number of European partners.

5.13 The Enterprise Networks are actively involved in supporting the biomass sector, examples include:

5.14 Lanarkshire Biomass Project, which is a public sector partnership created to develop a commercial biomass project based on burning wood chips to create renewable energy. Partners are North Lanarkshire Council, Central Scotland Forest Trust, Scottish Natural Heritage, Scottish Enterprise and Forward Scotland.

5.15 Perthshire Biomass Partnership, which is a network to encourage the development of the local wood fuel market consisting of representatives from Scottish Enterprise Tayside, Forestry Commission Scotland and Perth and Kinross Council. The project has sought to promote developments in the use of wood fuel for heating at the same time as establishing the local wood fuel supply chain.

5.16 Scottish Enterprise are working with the Scottish Forest Industries Cluster, a group which includes all stakeholders in the sector, to develop knowledge, new products and markets, strengthen links with the wider community, all collaborating to their mutual benefit.

5.17 While there are good examples of regions taking a lead in developing the biomass sector, more needs to be done to ensure all regions of Scotland can benefit. There is a need to identify priority areas across Scotland that offer the best opportunity to exploit the bioenergy sector, be that heat, electricity or both. This would allow for better targeting of support from the various stakeholders involved in the sector.

Accreditation

5.18 Consumer confidence in equipment and installation is supported by the accreditation of installers through the Clear Skies programme (www.clear-skies.org). However, the number of accredited biomass installers is limited and there is a need to build capacity in the sector to provide greater choice and confidence in the market for consumers. The IGNITE training course run by Rural Development Initiatives has provided a basis for capacity building in the woodfuel sector and the Northern Woodheat training course run by Highland Birchwoods provides technical training for professionals in designing and commissioning woodfuel systems. The Executive is encouraging development of training for designers, engineers and installers of woodfuel equipment and will provide support for an effective and coordinated accredited training programme.

5.19 For the first time, it provides a list of woodfuel suppliers which now covers the whole of Scotland. There is however the need to develop standards for woodfuel quality and allow users to identify suppliers who apply best practice in terms of environmental and quality standards.

5.20 Consumers can also refer to approved appliance listings on the Energy Technology List (via www.eca.gov.uk) to ensure the equipment they install meets the minimum emissions standards. Consumers in Smoke Control Areas must also refer to the exempt appliance list (at www.smokecontrolareas.co.uk). The number of appliances is currently limited and equipment suppliers are encouraged to register their equipment.

REGULATION AND PLANNING

5.21 In 2006, the Executive consulted on proposed revised planning policies for renewable energy developments. The proposals in draft, Scottish Planning Policy 6: Renewable Energy set out how the development plan process can best support the continued growth of all renewable energy technologies, including biomass, so that development takes place in the context of a long-term and inclusive vision. Responses to the public consultation exercise on the Executive's draft proposals are still being considered. Finalised guidance should be in place by March 2007.

5.22 Draft policies indicated that planning authorities should consider the extent to which there are opportunities through development plan policies to identify sites appropriate for new biomass plants in those areas where there are either existing long-term secure resources or new opportunities available to harness local resources. This does not rule out development applications outwith these areas so long as they satisfactorily address specified broad criteria. In all cases, plans should confirm that the development of new biomass energy plants will be supported subject to local landscape, built and cultural heritage, amenity (including public health and safety), environmental and transportation issues being satisfactorily addressed.

5.23 SEPA has now issued clear guidance entitled "Is it waste - understanding the definition of waste" ( www.sepa.org.uk/pdf/guidance/waste/is_it_waste v2.pdf. ). The guidance advises that biofuel from timber and other crops is not waste, nor are forestry residues or material produced by the timber processing industry from virgin timber likely to be considered waste. The guidance provides clear advice on a range of biomass sources and the key message is that the concept of waste can not be interpreted restrictively, but must ensure that the environment and human health are safeguarded.

5.24 A draft Scottish Planning Policy ( SPP)10 Planning for Waste Management was issued in August 2006 and responses are now being analysed for planned completion of a finalised SPP in spring 2007. The SPP recognises that in rural areas, farmland or forests may determine the best locations for thermal treatment plants designed for biomass.

PUBLIC PROCUREMENT

5.25 As highlighted in "Changing Our Ways" Scotland's Climate Change Programme the public sector across the UK buys £125 billion worth of goods and services each year. The Executive has a role to play in demonstrating leadership in all aspects of sustainable public procurement.

5.26 The Executive already promotes best practice across the public sector, and provide advice and support by:

• maintaining a website;
• issuing guidance and advice to public sector procurement officials;
• working with other public bodies;
• providing specific training to the Executive's procurement staff on how to incorporate sustainable development issues into procurement.

5.27 Once the UK Government has responded to the UK Sustainable Task Force report, the Executive will produce a Scottish Sustainable Procurement Action Plan that will build on progress already made in Scotland and take into account the work of the UK Task force. The Action Plan will also identify key performance indicators and benchmarking opportunities to deliver on the Executive's ambition to be a leader in this field.

5.28 A number of public organisations are now considering biomass as an alternative source of heating. Exemplar projects can be found at the offices of Scottish Natural Heritage in Aviemore and in three Forestry Commission Scotland offices at Huntly, Dingwall and Inverness where small biomass heating systems have been installed. In the local authority arena, North Lanarkshire Council have led the way, with installations in four council premises and Argyll & Bute Council has installed a woodfuel systems in the new Aqualibrium Centre in Campbeltown. Several other local authorities have projects (both PPP and conventional) in development including Highland Council, Perth & Kinross Council, Moray Council and Aberdeenshire Council.

5.29 The procurement of PPP initiatives is strictly regulated by European Directives and implementing regulations in the United Kingdom such as the Public Works Directive (93 / 37 / EEC) and the Public Services Directive (93 / 50 / EEC). However, the Executive recognises the need to build confidence in the biomass sector at this early stage. As mentioned above, a number of demonstration projects in Scotland have received public support, which will provide a excellent source of information that can be disseminated to organisations looking to install similar systems. The Executive will use these exemplars to develop bespoke information and case studies.

FINANCIAL SUPPORT

5.30 Current support for heating with biomass is available through a number of schemes, targeted at particular groups.

5.31 The Scottish Community & Householder Renewables Initiative ( SCHRI) is funded by the Executive and managed by the Energy Saving Trust and Highlands and Islands Community Energy Company. It provides funding towards the development and capital costs of renewables projects for communities, as well as assisting technical assessments of project feasibility. To date, support worth over £1.4 million has been allocated to more than 30 wood-fired community projects, including district heating schemes, schools and community centres.

5.32 At the domestic scale, the SCHRI provides support for the installation of a range of household renewable energy technologies, including automated woodfuel heating systems. Nearly £250,000 of grants have been allocated to householders for the installation of biomass boilers.

5.33 The Executive is also supporting the Carbon Trust's Biomass Heat Acceleration Project ( BHAP) in Scotland. The aim of the project is to accelerate the development of the biomass-for-heating market in Scotland by focussing on reducing costs and supply chain risks. In the first phase, the BHAP is currently working with 10 existing installations in Scotland.

5.34 Renewables Fuel Poverty Pilot. The Executive is undertaking a renewables heating pilot which will run over 2006-08 to look at the potential for including renewable technologies in the fuel poverty programmes in the future. One million pounds will be allocated over the two years to install renewable technologies in a variety of house types and geographic conditions across Scotland.

5.35 Scottish Biomass Support Scheme. A key new support measure is the Executive's Scottish Biomass Support Scheme. The £7.5 million funding package will support projects across a range of scales, from both public and private organisations. The Scheme will support both supply chain infrastructure and installations. Its key aims are: strategic transformation of the biomass sector, maximising of carbon savings, maximising support for local economy by creating sustainable green jobs and contributing to renewable energy targets.

5.36 Regional Selective Assistance ( RSA). The Executive's main scheme of financial assistance to create and safeguard jobs in the Assisted Areas of Scotland can also offer support to bioenergy projects.

5.37 Demonstration projects. Prior to the Biomass Support Scheme, the Executive has supported a number of demonstration projects in Scotland that offer excellent examples of the benefits of biomass energy, and encourage others to follow suit:

Queen Margaret University College - grant funding of £400,000 to support the installation of a biomass plant.

Perth and Kinross PPP School Projects - grant funding of £400,000 to support the installation of biomass heating systems in 6 schools to be build under PPP.

Pilot Biomass Grant Scheme in Highlands and Islands - grant funding of £430,000 to develop 12 biomass installation projects.

5.38 Rates Relief. The Scottish Executive will be consulting shortly on providing preferential rating treatment for renewable energy generators. The aim is to incentivise and increase the level of renewable energy generation in Scotland.

5.39 UK Support. Additional support for renewable energy is available through a range of UK wide programmes including:

• Enhanced Capital Allowances ( www.eca.gov.uk)
• Low Carbon Buildings Programme ( www.lcbp.org.uk)

SUMMARY

Scotland has the capacity to become a major player in renewable heat from biomass and this is an area that the Executive will focus on in the coming year. The key initiatives over that period will be the production of a Renewable Heat Strategy and the introduction of a Biomass Support Scheme. Along with Executive support for industry-led development of major biomass heat and power plants, these initiatives will help support the transformation of the biomass sector in Scotland. In addition, we will also ensure that planning regulations and procurement policy offers a supportive environment for renewables projects to develop and grow.

Key areas which will be addressed through the Renewable Heat Strategy to strengthen the biomass heating industry and build public confidence in the sector include:

• advice and support;
• sharing best practice;
• information and training for professionals and installers;
• specifications for equipment; and
• clear and consistent standards for fuel supply.

ACTION TABLE

Lead Department	Action	Timing	Indicators/Outputs
ETLLD - Renewables	Implement Scottish Biomass Support Scheme	Jan 07	Installed thermal capacity CHP capacity Carbon savings Number of district heating schemes
Forestry Commission Scotland	Review uptake and outcomes from IGNITE and Northern Woodheat training programmes	Jan 07	Number of accredited suppliers
ETLLD - Renewables	Develop training courses for professionals and installers	June 07	Number of accredited training courses Number of accredited installers
Forestry Commission Scotland	Work with industry to encourage use of recognised biomass standards	Dec 07	Industry standards for biomass supply
Forestry Commission Scotland	Liaise with relevant Executive departments and external stakeholders to develop information provision on range of biomass	ongoing	Update Woodenergy website Study into commercial viability of alternative crops and biomass
ETLLD - Renewables	Develop a Renewable Heat Strategy	Dec 07	Renewable Heat Strategy
ETLLD - Renewables	Represent Scottish interests within a comprehensive UK Biomass Steering Group	ongoing	Input to UK Heat Strategy
Forestry Commission Scotland	Monitor installations and share best practice	ongoing	Sectoral report
FCSD - Local Taxation	Consult on rates relief for renewable energy generation	2007	Increase take-up by business of renewable sources of energy
ETLLD -Renewables	Identify biomass potential on a regional basis	2007	Growth of local bioenergy sector in Scotland