Bioenergy - draft policy statement: consultation

Chapter 1: Bioenergy Use

Bioenergy has many applications across heat, power, industry and transport, with a diverse range of mature and emerging technologies. In this chapter we set out a series of draft guiding principles for bioenergy use, as well as our high-level view of where we see demand for bioenergy in the short, medium and long term.

We recognise that the use of, and demand for, bioenergy will evolve as new technologies, market opportunities and evidence develop. The following therefore represents our initial thinking on future bioenergy use in Scotland, and we are seeking your views through the consultation on this draft Policy Statement.

In our Bioenergy Update we committed to setting out a strategic framework (guiding principles) for bioenergy. We worked with our internal Bioenergy Policy Working group to identify these principles. We have also been working with the UK Government as they developed their Biomass Strategy and our draft principles for use of bioenergy are closely aligned with that Strategy. These principles should be considered when sector specific policies related to bioenergy use are being developed. These draft guiding principles are:

1. Use of biomass must comply with stringent sustainability criteria (including land criteria and greenhouse gas emissions reduction criteria). The current use of biomass should meet existing criteria relevant to the sector in which it is used. Longer term we expect biomass use to meet the new cross-sectoral sustainability framework to be developed by the UK Government. Biomass use should also be independently monitored and verified to ensure best practice and the highest standards are upheld.

2. The bioenergy sector should prioritise the use of available waste feedstocks. The use of biomass must comply with the principles of a circular bioeconomy and a cascading use of biomass. For example, wood should first be used where it can deliver the highest economic and environmental benefit (for example in construction), then life extension, reuse and recycling of the wood should be sought before finally its use in bioenergy applications. Availability of bioresource has many constraints and we should ensure that any feedstock has no wider residual value within society before being utilised for energy.

3. Use of biomass should be prioritised towards practices where there are limited options to replace fossil fuels. This recognises there are areas of the economy which are hard to decarbonise and as such bioenergy should be used in those specific areas.

4. Use of biomass must support emissions reduction and the pathway to net-zero by 2045. This includes application of carbon capture technology as soon as feasible to do so. Notwithstanding the principle above, short term uses in hard to decarbonise sectors should not mean longer term alternative solutions are not developed.

5. Use of biomass must comply with all environmental regulations as set out by the Scottish Environment Protection Agency (SEPA).

6. Biomass feedstock production and use of bioenergy technologies should facilitate these sustainable development goals:

• Scotland should be a world leader in affordable and clean energy.
• We have a globally competitive, entrepreneurial, inclusive and sustainable economy.
• We have thriving and innovative jobs and fair work for everyone.
• We will focus on creating a more successful country, with opportunities for all of Scotland to flourish, through increased wellbeing and sustainable and inclusive economic growth.
• Scotland is recognised for its leadership in encouraging and promoting a more circular economy.
• We will tackle climate change and by 2045 will transition to a net zero emissions Scotland for the benefit of our environment, our people and our prosperity.
• Enhancing and protecting Scotland’s biodiversity and ensuring the health of its environment is critical in the fight against climate change and ensuring the environmental, social and economic benefits they bring for future generations.

1.1. Priority use for bioenergy

Having declared a climate emergency in 2019, the priority use for bioenergy should be facilitating carbon removal via Bioenergy with Carbon Capture and Storage (BECCS) technologies, as they are the cheapest method of delivering engineered negative emissions. There will be a number of other specific roles across heat, transport and industry where biomass can displace fossil fuels.

At a high level, our priority uses for bioenergy are similar to those set out in the UK Biomass Strategy.

• In the short term there will continue to be demand for biomass to be used in power, heat and transport. Where possible, we support early adoption of Carbon Capture Utilisation and Storage (CCUS) paired with bioenergy applications.
• In the medium term, most bioenergy should begin to transition away from unabated uses of biomass where possible, to uses such as BECCS, which are critical to meeting net zero.
• In the longer term BECCS will be the priority role and could make significant contribution towards net zero. There will be limited use in some hard to decarbonise sectors that cannot deploy BECCS.

Scotland’s bioenergy sector, however, differs from England’s in terms of scale. Our largest biomass power plant is 55 MW, compared to the Drax (4 x 645 MW) or Lynemouth (420 MW) power plants in England. Our wood fuel supply chains are efficient and for the most part based on domestic supplies, and we have a large number of distilleries, including many located in remote or island locations. The by-products of whisky production can be used to generate energy or they can utilise biomass to displace fossil fuels.

The recently published Negative Emissions Feasibility Study shows that across the uses of biomass, some early movers will deploy carbon capture and storage to deliver negative emissions from 2030 onwards, as well as other approaches to removing CO2 from the atmosphere such as biochar. We expect the use of biomass to increasingly be prioritised for emissions removals. A list of potential BECCS technologies can be found in Annex C.

Bearing in mind the draft guiding principles set out above, we set out below, for consultation, our high-level expectations on the sectoral uses of bioenergy now and in the future. This demonstrates how we expect bioenergy use to change over time, and in a way which supports our overall aim for bioenergy to be used where it has the greatest impact on reducing emissions.

Short to medium term (out to 2035)

We see the current sectoral uses for bioenergy from now until the mid-2030s as:

Power – Existing biomass power and biomass / biogas Combined Heat and Power (CHP) plants. New biogas CHP plants which utilise waste resources.

Heat – Biomethane injection to the gas grid, local district heating schemes or for emergency back-up systems using biogenic feedstock. Biomass or biofuels may be the only solution for existing properties that are currently not suitable for clean heating systems.

Transport – Biofuels for Heavy Duty Vehicles (HDV) and Heavy Goods Vehicles (HGV), maritime or agricultural vehicles. Use of biomass for Sustainable Aviation Fuel (SAF) production and use of biofuels for rail transport where electrification of lines is not currently possible.

Industry – Distilleries and breweries, pulp and paper mill, wood panel and pellet production, fuel switching from fossil fuels with potential for linking to future CCS (Carbon Capture and Storage) infrastructure.

Wherever possible we expect locally available resources to be used to meet the demands of the area. We would expect early movers from across the applications listed above to deploy carbon capture technology during the short to medium term, out to 2035.

Longer term (beyond 2035)

The longer term (post-2035) use of bioenergy should prioritise BECCS applications where possible, and the majority of biomass uses should deliver negative emissions, but specific timing and detail will depend on how technologies develop.

Power – Electricity generation and hydrogen production. Both technologies having been identified as having potential for being used with carbon capture and with recoverable heat being used - for example offsite in district heating schemes.

Heat – Limited use in district heating and potentially biomass / biofuel heating systems in existing homes where no other clean heating solutions are suitable.

Transport – Resources directed towards aviation and synthetic fuel production with CCS.

Industry – Use of BECCS within distilleries and breweries, pulp and paper mill, wood panel and pellet production and the cement industry.

Biochar is another emerging use of biomass which can sequester carbon and we will continue to explore the opportunities for use in agriculture and the applicability to, and opportunities in, the carbon market.

Bioenergy is cross cutting in nature, affecting a wide range of policy areas from across the Scottish Government and a whole systems approach is required when considering the optimal contribution that bioenergy can make to the energy system. We provide more details below on how bioresources are currently used within the energy sector and how this may change over time.

Questions on preferred uses and principles for use of bioenergy

1. Do you agree with the overarching principles for use of bioenergy, as set out in this document on page 7?

2. Do you agree with the priority uses of bioenergy, as set out in this document on page 10?

1.2. Current use of bioenergy – technology types

Power and Combined Heat and Power (CHP)

Currently, the majority of Scotland’s wood fuel is directed towards large combined heat and power plants. This aligns with our view set out in the 2017 Scottish Energy Strategy, that biomass should be used in heat only or combined heat and power schemes to exploit available heat and local supply. This is due to greater efficiency compared to power only. CHP typically has an efficiency of over 80%.

Markinch Case Study

Markinch combined heat-and-power (CHP) plant began operating in 2014. The 55 MW site in Markinch, Fife predominantly uses recovered wood waste to generate electricity. Excess heat from the site is used to produce hot water to fuel the Glenrothes Energy Network that benefits 55 homes (including sheltered accommodation), 9 business units, Fife Council‘s corporate headquarters and a theatre complex. Markinch is the largest biomass-fuelled power station in Scotland.

In 2019, the Scottish Government provided £8.6 million in funding towards the Glenrothes Energy Network, via the Low Carbon Infrastructure Transition Programme.

Heat in Buildings

The majority of Scotland’s renewable heat currently comes from bioenergy, with 67% from biomass and 16% from biomethane injected to the gas grid (biomethane currently accounts for 1.65% of Scottish gas demand).

For buildings, biomass boilers that burn wood pellets, chips or logs are a well-established heating technology, which have been successfully supported through the UK Government’s Renewable Heat Incentive (RHI) schemes. The schemes have closed for new applications but final payments for domestic participants may run until 2029 and for non-domestic participants that could be 2041. Sustainability of feedstock for these schemes can be guaranteed by purchasing through the Biomass Suppliers List (BSL).

The Woodfuel Demand and Usage in Scotland report carried out a review of woodfuel consumption by installation size category in 2021 (see table below).

Installation size category	Number of installations	Percentage of installations	Wood fuel consumption (oven dried tonnes)	Percentage of wood fuel consumption
Domestic	4,771	57%	50,000	3%
Small non-domestic	2,598	31%	110,000	7%
Medium non-domestic	935	11%	229,000	15%
Large non-domestic	58	1%	1,103,000	74%
Total	8,362	100%	1,491,000	100%

In order to meet our legal obligation to reach net zero the heating systems in the vast majority of our buildings will need to be changed from polluting heating systems to clean heating systems. Some households and businesses are already doing this, with around 5,000 people per year installing heat pumps and around 33,000 buildings connected to heat networks.

We have been consulting on proposals for a Heat in Buildings Bill which set out our proposals to make new laws around the heating systems that can be used in homes and places of work. The consultation reconfirmed our plans that the use of polluting heating systems will be prohibited after 2045 and, as a pathway to 2045, those purchasing a home or business premises will be required to end their use of polluting heating systems within a fixed period following completion of the sale.

We recognise that as a renewable, and potentially net zero, energy source bioenergy may represent the best option to help decarbonise some homes for which clean heating systems are not suitable.

The use of solid biomass for heat is well-established in Scotland but biofuels such as BioLPG, also known as biopropane, renewable dimethyl ether (rDME) and Hydrotreated Vegetable Oil (HVO) could also potentially be used in some homes where zero direct emission options are not suitable. Similarly, there may be heat networks with limited options for back up heat sources and biofuels may be the most appropriate option. They can either be blended with fossil fuel or 100% renewable. These fuels can be produced from a number of bioresources, including used cooking oil, animal fat, vegetable oil or forest residues. These bioresources must be sourced sustainably and verified by an independent Monitoring, Reporting and Verification (MRV) process.

We want to ensure that owners who have taken the proactive step of installing renewable bioenergy systems are fairly treated. This is why, in addition to permitting extra time for those currently using bioenergy to meet the clean heat element of the Standard, we have been seeking views on whether a more flexible approach to the use of bioenergy under future regulations is needed. The Delivering net zero for Scotland’s buildings – Heat in Buildings Bill consultation collected responses until 8 March 2024 and we will use the responses to inform our approach to bioenergy in future regulations.

From April 2024, new buildings will not be allowed to use bioenergy systems unless these are part of a heat network or as emergency backup. The New Build Heat Standard only applies to systems used for heating and cooling. This does not apply to industrial process heat.

Anaerobic Digestion (AD)

Anaerobic Digestion (AD) uses wastes, residues and food/feed crops as feedstock. These biogenic materials are broken down in a container, without the presence of oxygen, to produce biogas and digestate. The biogas can be upgraded to biomethane and then injected to the gas-grid, used as a fuel for transport or to provide industrial heat.

Graphic credit NNFCC: Assessing the Scottish anaerobic digestion market based on agricultural waste. Details of this diagram can be provided upon request.

Section 2.3 will provide more detail on the available domestic feedstock, but there could potentially be an additional 2 TWh/year of feedstock which is suitable for processing via AD that is not currently being utilised.

At small farm scale, manures and slurries can be collected and processed to provide biogas for heat and power. Research into the processing of farming waste through anaerobic digestion found that these materials typically have a low energy yield but if avoided emissions are taken into account, they can generate electricity with a zero or negative carbon footprint.

A number of distilleries have deployed AD plants, using draff, pot ale syrup and other spent grains as a way of producing biogas and an effective way to reduce their emissions. For urban areas, food waste and sewage sludge can be used as feedstock for AD plants.

The digestate left at the end of the anaerobic digestion process can be used as organic fertiliser, which offers better nutrient management and placement than using manure or slurry. Using digestate can also help to protect farmers from volatile prices of synthetic fertiliser, which is made from natural gas, as well as reducing reliance on imported fertilisers.

When biogas from AD is upgraded to biomethane, this provides a cleaner, more energy dense fuel. During the upgrading, it also provides an opportunity to capture CO2 during the process. The captured CO2 can then be utilised in the food and drinks sector, or in the emerging biotechnology and chemical sectors. Development of carbon capture and storage with AD plants has also been identified by the Negative Emissions Technologies (NETs) feasibility study as a possible way of kickstarting the sector.

AD case study

The Outer Hebrides Local Energy Hub is a multi-sector partnership comprising the Bakkafrost, Pure Energy Centre, Community Energy Scotland, and Comhairle nan Eilean Siar (CnES). The project was supported by Local Energy Scotland through the Scottish Government’s Local Energy Challenge Fund.

The project uses fish waste from the local food processing plant, feeds this into an anaerobic digestor, using the resulting biogas in a CHP unit. The power output is combined with the energy from a local turbine and will be used to power a hydrogen electrolyser, with the resulting oxygen used to feed salmon. The hydrogen will power a fuel cell CHP which provides heat and power to the salmon hatchery. Some of the hydrogen will also be used to fuel a refuse truck which can collect more waste for biogas production.

The UK Government’s Green Gas Support Scheme (GGSS) has replaced the Non-Domestic Renewable Heat Incentive (RHI) in providing support for production of biomethane, although the Non-Domestic RHI scheme can pay for up to 20 years. The GGSS is targeted at utilising food waste for biomethane production, but other feedstock is permitted so long as 50% is classified as waste. With the ban on biodegradable municipal waste going to landfill due to be in place in Scotland from 2025, this should divert more waste biogenic resources towards AD plants.

Biomethane injection to the gas grid currently contributes 920 GWh per year and, as set out in our Heat in Buildings Strategy, we need to see an increasing blend of biomethane in our gas grid over the next decade. The GGSS has now been extended to allow applications until 31 March 2028.

The next iteration of the GGSS needs to be in place as soon as this scheme ends to ensure continued support. The following scheme should also take a wider system view, incorporating Ofgem’s statutory net-zero duty. Utilisation of waste such as manures and slurries, which are a source of emissions, should be a priority and would help to reduce agricultural emissions. The addition of carbon capture technology should be encouraged through any new scheme.

Transport

The Scottish Government expects that renewable electricity and hydrogen will facilitate the net zero transition of most forms of transport. However, there are sectors where zero emission technologies are not yet available for widespread deployment. This includes long distance Heavy Goods Vehicles (HGV), maritime, aviation and mobile agricultural machinery.

In the short term we see the most effective use of bioenergy for reducing emissions from transport to be ‘drop in’ biofuels, which can be blended with fossil fuels, in aviation, HGVs, maritime, rail and mobile-agricultural machinery until other zero emission technologies mature.

In the medium term, biofuels may be used at a higher blend but as the bio content increases there may be requirement for new vehicles to be adopted. In the medium to long term, we recognise that bioresources have potential to be used in development of Sustainable Aviation Fuel (SAF). To this end, we are forming a short life working group to evaluate these opportunities, alongside consideration of other advanced fuels which may develop.

The development of biofuels for transport is currently supported through the UK Government Renewable Transport Fuel Obligation (RTFO). Under the RTFO, large suppliers of relevant transport fuel in the UK must demonstrate that a percentage of the fuel they supply comes from renewable and sustainable sources. Biodiesel accounts for 47% of fuel supplied under the RTFO, of which 93% is produced from used cooking oil (UCO).

Feedstocks under the RTFO are restricted by the ‘crop cap’, which sets an upper limit on the amount that food or feed crop-derived biofuels can contribute towards fulfilling an individual supplier’s obligation. This limit will decrease from 3.67% in 2023 to 2% from 2032 onwards. This crop cap excludes dedicated perennial energy crops. The RTFO compliance guidance outlines the sustainability criteria that approved suppliers must meet, similar to the EU’s Renewable Energy Directive. This also includes a requirement for biofuels to achieve at least 65% greenhouse gas emissions saving. Suppliers must also be able to demonstrate a complete chain of custody in order to evidence that these criteria are met in full.

Mobile agricultural machinery

Mobile agricultural machinery produced 0.9 million tonnes of carbon dioxide emissions in 2021. This equates to 11% of total agricultural emissions. Electric alternatives to fossil-powered machinery (for heavy-duty, high-powered tractors, sprayers and combine harvesters) are currently limited as their size, power output and operational uses make them economically unviable to operate at present.

Research which considered the decarbonisation of mobile agricultural machinery in Scotland indicated that replacing fossil-diesel with biodiesel could equate to either a 4.18% reduction of CO2e emissions with a B5 blend, or a 16.2% reduction with a B20 blend. Using only biodiesel (B100), by 2035 carbon emissions from mobile agricultural machinery could reduce by 83.6%, if all vehicles are compatible with this higher biodiesel content. Despite being compatible with existing machinery, biodiesel can corrode engine parts faster and be more difficult to store than fossil-diesel.

Purpose-built machinery could achieve 77% reduction in carbon emissions by using biomethane as a fuel. This is most likely to be achievable on larger-scale farms, or where co-operative agreements exist between different farmers and land managers that have greater access to waste feedstocks, residues and anaerobic digestors.

To reflect the need for reducing emissions from mobile agricultural machinery, we have committed through our Programme for Government 2023-24 to hold a roundtable on decarbonising rural machinery and equipment. This will contribute towards developing policy ahead of the upcoming Climate Change Plan.

Heavy Goods Vehicles (HGV) and Heavy Duty Vehicles (HDV) Case Study: biomethane HGVs

CNG Fuels currently operate four HGV biomethane compressed natural gas (bio-CNG) refuelling stations in Scotland, with plans to establish a network of 60 sites across the UK by 2026. Their site at Eurocentral Industrial Estate, near Bellshill (pictured) is capable of refuelling up to 450 trucks per day. Refuelling an HGV with bio-CNG typically takes 5-7 minutes to deliver 500 miles of range.

Biomethane is sourced from a variety of RTFO-approved suppliers across the country and groups such as the John Lewis Partnership, Royal Mail and Warburtons use the sites to power their HGV fleets.

Trains

The Scottish Government committed to decarbonising rail transport by 2035 in our Rail Services Decarbonisation Action Plan 2020. A rolling programme of electrification will deliver this on the majority of Scotland’s rail network. However, biofuels may serve as a transition solution to reduce emissions in areas awaiting full electrification or until other technologies, such as battery electric, are further developed.

Aviation

Aviation is a sector that will take longer to decarbonise as zero emission options such as battery or hydrogen-power have lower energy density than conventional aviation fuel. This may limit the initial range of some electric and hydrogen-powered aircraft when they become available for commercial services.

The UK Government intends to introduce a Sustainable Aviation Fuels (SAF) mandate in 2025, equivalent to at least 10% (around 1.5 billion litres) of aviation fuel to be made from sustainable sources by 2030. Eligible fuels will be waste-derived biofuels (using feedstock such as Used Cooking Oil (UCO), agricultural and forestry residues, animal fats), recycled carbon fuels (making use of unrecyclable plastic and waste industrial gases) and power to liquid (PtL) fuels (combining hydrogen with CO2 to produce synthetic fuel).

The SAF mandate does not allow the use of food, feed or energy crops, in order to address concerns over sustainability and competition with food supply. The use of hydro-processed esters, fatty acids (HEFA), also known as Hydrotreated Vegetable Oil (HVO) is expected to be capped to ensure that resources are not diverted from supplying renewable fuel to road transport.

Replacing or blending conventional aviation fuel with drop-in, synthetic and Sustainable Aviation Fuels (SAF), would lower emissions from the sector. A 100% blend could theoretically achieve around an 80% reduction in carbon emissions. However, there are unlikely to be sufficient biomass feedstocks available to achieve this, and so a mix of SAF fuels will be required.

Industry

Industries in Scotland which are currently using bioenergy include paper mill, wood panel manufacture, distilleries, breweries and the wood pellet producers themselves. These sites primarily use biomass for heat or Combined Heat and Power (CHP), with the heat being used for industrial processes and the feedstock often being part of the onsite processing (such as sawmills/distilleries etc). Many of these sites could be suitable for adding carbon capture technology, when that becomes feasible.

1.3. Bioenergy with Carbon Capture Utilisation and Storage (BECCS)

Due to limited zero emission options, or because they are inherent in a process, there will be residual emissions across the economy from agriculture, transport and industry. Nature based solutions for absorbing greenhouse gas emissions, such as woodland creation or peatland restoration, can provide carbon stores and provide wider benefits for biodiversity but cannot be deployed at a scale needed to offset all the residual emissions across Scotland’s economy. According to the balanced pathway in the Climate Change Committee’s (CCC) 6th Carbon Budget, nature-based solutions will need to lock away 39 MtCO2/year across the UK by 2050. Engineered emissions reductions will be required to capture 58 MtCO2/year. Extensive amounts of land would be required if only relying on nature-based solutions.

We want to see bioenergy used where it can deliver the greatest emissions reductions, and this would be through the use of carbon capture technology. Research which considered the opportunities for CO2 storage around Scotland concluded that there is vast potential in the North Sea, estimating that up to 46Gt of CO2 storage in Scottish waters. This would be enough capacity to store at least 200 years of Scotland’s CO2 output.

Developing carbon capture technologies will help to make the most of our natural resources, providing new opportunities and a just transition for communities in the North East. Without NETs technologies it will be impossible to offset residual emissions from across the economy. We therefore want to encourage a move away from unabated burning of biomass wherever possible.

In 2023 the UK Government consulted on Decarbonisation Readiness (DR) proposals which would provide more flexible and clear decarbonisation pathways for all new build combustion power plants, including biomass. The proposals include:

• Removal of the 300 MW minimum capacity threshold
• Moving DR requirements from the planning consent process to the environmental process
• Inclusion of both new build and substantially refurbished combustion power plants

These plans would only apply to England.

The Scottish Government have already set out in the National Planning Framework 4 that Energy from Waste (EfW) facilities must provide an acceptable decarbonisation strategy and that a functional heat network be developed wherever possible. We want to align policy across all combustion technologies and seek views from industry on most suitable decarbonisation pathway for Scotland.

Questions on phasing out unabated combustion of biomass

3. Do you agree with the intention to phase out unabated combustion of biomass?

4. Should there be a minimum threshold at which carbon capture should be considered for bioenergy technologies and should refurbishment of plants also be included?

5. From what date should any mandate to consider carbon capture technology be implemented for bioenergy plants?

6. Should decarbonisation options other than fitting carbon capture and storage technology be considered suitable as part of decarbonisation requirements for biomass plants, for example use of waste heat as part of a combined heat and power (CHP) plant or heat network?

1.4. Development of BECCS in Scotland

The development of BECCS technologies in Scotland is highly reliant on the Acorn Transport and Storage (T&S) project. This will provide the infrastructure which would make BECCS feasible in Scotland. Led by energy consultants Storegga, the project focuses on the St Fergus gas terminal, which is ideally located to utilise existing offshore and onshore pipeline infrastructure to access offshore storage locations (including the Goldeneye field), all of which are necessary for CCS.

Establishing a Scottish CCUS cluster requires success in the UK Government’s CCUS cluster sequencing process which aims to establish four clusters, with an ambition to capture and store 20-30 MtCO2 per year by 2030. Success provides access for projects to the £1 billion CCUS Infrastructure Fund, Business Revenue Model Support, and UK Government underwriting of storage liability. In July 2023, the UK Government announced that the Acorn T&S project is ‘best placed’ to meet its Track 2 objectives and in December 2023, the UK Government stated that initial engagement had started with the Acorn Project, and that in early 2024, Acorn will be asked to submit ‘anchor phase’ plans for assessment (to include details of how at least 2 emitter projects can connect to Acorn by pipeline, and also show how the system can be expanded) along with provisional ‘buildout phase’ expansion plans.

There are a range of BECCS technologies which are at various stages of development. Biomethane production sites and the fermentation process are already suitable for commercial deployment of carbon capture. Power and CHP have been demonstrated at a number of locations across the globe, with plans in place for commercial deployment. Fitting post combustion carbon capture technology to energy from waste sites is also at a similar stage of development. Biochar production and bio-hydrogen are at earlier stages of development.

As well as being technically viable, any new BECCS technology would have to be economically viable. The UK Emissions Trading Scheme (UK ETS) aims to increase the financial incentive to reduce emissions. The possible inclusion of greenhouse gas removals within the UK ETS could encourage deployment of carbon capture, when the technology is more developed, and give greater confidence to investors.

A literature review carried out by the UK Energy Research Centre found that costs for BECCS in the UK would be between £70 - £130/tCO2 when using local biomass, and between £150 and £200/tCO2 when using imported biomass.

Modelling carried out to assess the optimal sites for BECCS power plants found that the transport of domestic biomass by road would likely be limited to within 100 km, in order to limit transport costs and emissions.

The UK Government have also been consulting on Business Models for Greenhouse Gas Removals. This could support a range of technologies using a contract for difference model, where investors would receive a guaranteed strike price for energy or carbon despite any fluctuations in the market price. Any revenue received over and above the strike price would be returned to the Low Carbon Contracts Company (LCCC).

With many bioenergy sites nearing the end of their Renewables Obligation (RO) contracts and looking to make decision on future investment, it is vital that UK Government provide clarity on dates and criteria for future support schemes.

Our Programme for Government 2023-24 confirmed our commitment to work with industry to accelerate decarbonisation and create energy transition opportunities at major industrial sites with support of the Scottish Industry Energy Transformation Fund, the Energy Transition Fund and the Emerging Energy Technologies Fund.

1.5. Opportunities and barriers

All pathways to net zero require some form of negative emissions technologies and bioenergy is unique, when deployed with carbon capture technology, in being able to generate energy and remove greenhouse gases from the atmosphere.

BECCS technologies are still developing and the full process through to storage has only been demonstrated in a few places worldwide. New markets are also developing for utilisation of the CO2 but the scale of demand is still unclear.

Utilising existing supply chains to develop the NETs sector provides a long-term market for resources which would otherwise become waste, helps preserve jobs and provides a means for these sites to achieve emissions reductions.

Distilleries, breweries and biomethane production sites already have established technologies which can capture CO2, which is often utilised in the food and drink sector. When CO2 storage becomes available, they present opportunities to be early adopters to help establish a NETs industry in Scotland, although this would be with relatively small volumes of CO2 capture.

Existing power and industry sites have the potential to deliver the greatest amounts of negative emissions by retrofitting carbon capture technology. EfW sites are also suitable for fitting carbon capture technology, in order to generate negative emissions (where waste incinerated is biogenic).

Many of the policy levers to support development of bioenergy technologies are not devolved and we need greater certainty from the UK Government on where their priorities lie, particularly around the development of BECCS technologies. Uncertainties around timings for the Acorn project along with a lack of support mechanisms have curbed interest from investors to put forward the significant capital investment that would be required for new projects.

With interest in BECCS growing across the globe but only a limited number of companies involved in the supply of carbon capture equipment, there is a risk of supply chain delays. There may also be a limited workforce with the necessary skills to deliver CO2 storage, although Scotland’s oil and gas sector already have similar skill sets and could benefit from new opportunities.

The increased demand for bioresources and potential impacts that could have on biodiversity and ecosystems are set out above. Monitoring, reporting and verification is critical, and processes must be credible in order to provide the public with confidence in the merits of increased use of biomass across the energy system. The public also need to have faith that the lifecycle analysis of emissions is accurate, that projects will deliver genuine negative emissions and that the carbon is safely stored.