Latest News - Large-scale biomass threatens 8,700 UK jobs... and risks a 1% increase in UK emissions

Large-scale biomass threatens 8,700 UK jobs... and risks a 1% increase in UK emissions
Mon, Jun 28, 2010

Wood panel industry unveils five point plan to safeguard its future
Sector under threat from 30% increase in wood price over last four years

 

Research revealed today has identified that the spiralling development of large-scale wood fired energy plants in the UK threatens 8,700 UK jobs* and risks a 1%, or six million tonne, increase in UK carbon emissions.

These are the headline findings of two independent reports commissioned by the Wood Panel Industries Federation, the voice of the UK industry, which today launches a survival campaign, ‘MAKE WOOD WORK’, to counter the severe market distortion its members face from the Renewables Obligation (RO) subsidy regime.

Wood panels, a vital component in the construction industry and in furniture manufacture, are produced from virgin and reclaimed wood – the same materials which biomass energy plants are being incentivised to burn by Government policy driven subsidy.

The Wood Panel Industry in the UK , A report for the Wood Panel Industries Federation, conducted by Europe Economics, found that:

 

·         The total gross UK employment attributable to wood panel manufacture amounts to 8,700 full time equivalent jobs

·         If large-scale wood fired power generators demand for UK-sourced wood is encouraged to develop unchecked, the sawmilling sector could also experience structural change in which generators will buy the whole tree and invest in forest properties and product preparation. The employment effects will therefore not be confined to wood panel manufacturing but could extend to the 12,000 or so people estimated by the Forestry Commission to work in sawmilling and related activities

 

Further research from CarbonRiver, identified that:

·         To subsidise the purchase of wood for incineration – as the current ROC scheme does – is to encourage the most carbon-intensive use of that resource

·         If the ROC subsidy continues to distort the market such that panel manufacture is displaced by the biomass industry – as trends suggest it might – there would be an increase in net CO2 emissions equivalent to 1.5 tonnes of CO2 per tonne of wood processed, a total increase of 6 million tonnes or 1% on the UK’s total net CO2 emissions each year (more than the total emissions of UK agriculture last year)

In simple terms, the wood panel manufacturing sector is under threat because electricity generators, supported by subsidy, can afford to pay more than double the price currently paid by the UK wood panel industry for its primary raw material. The blame lies with the introduction of the RO, which has distorted the market and resulted in WPIF members seeing an average wood price increase over the last four years in excess of 30%.

 

Alastair Kerr, Director General of the Wood Panel Industries Federation comments: “Ourresearch proves categorically that the Government’s renewable energy policies – specifically support for biomass – are directly damaging the competitiveness of the wood panel industry in the UK, which is wholly reliant on domestically-sourced wood. 

 

“If nothing is done to amend this policy, wood prices could potentially rise to a point where they meet that paid by generators for imported material. This will put thousands of jobs in the UK wood panel and associated industries at risk and has the potential to escalate costs for the construction and furniture industries. Consumers of UK-sourced products, who are already paying for the subsidy through their electricity bills, cannot escape the impact of this distortion.

 

“The Government is putting too great an emphasis on large scale wood-fired electricity and, by subsidising generators’ ability to pay for fuel, they are threatening to destroy an industry that adds economic value and brings environmental benefit through carbon storage.

 

“We are not anti-biomass and, indeed, as an industry we have pioneered the burning of our process-derived wood waste to generate heat and power, which is then fed back into our own manufacturing process. 

 

“Backed by MPs and a wide range of other organisations and individuals, our campaign today calls for a more responsible use of wood – one of our most precious natural resources. But, importantly, we are not asking for special treatment – just a level playing field.”

 

As a result, and through the MAKE WOOD WORK campaign, the Wood Panel Industries Federation (WPIF) is calling on Government to:

·         Modify the ROC banding in such a way as to remove its distortion in the market. The WPIF supports subsidy for capital expenditure in the UK biomass sector but not subsidy for its use of domestic wood as a feedstock

 

·         Ban wood – an increasingly precious resource – from landfill and maximise the lifespan of all wood in the UK 

 

·         Focus the subsidy on the expansion of non-wood fuels and fast-rotation crops, as these have a greater potential to reduce CO2 emissions in the short term. In the long term, the amount of UK forest cover should be increased

 

·         Only allow wood that has reached the end of its useful life, and after recycling opportunities have been exhausted, to be used by the energy sector in installations that maximise the heat potential of this valuable resource

 

·         Recognise the wood panel industry’s sizeable contribution to UK renewable heat generation under the Renewable Heat Incentive – and treat it as a special case by including its eligibility in the RHI and offer our industry an essential lifeline

 

*From Europe Economics’ report “ If the industry vanished today, the loss of employment would be some 8,700 jobs gross and about 4,400 net (taking account of the standard government re-absorption factor, which recognises that, over time, displaced employees find other employment)

             - ENDS -

Notes to editors:

Full details of the MAKE WOOD WORK campaign including the independent economic and environmental reports, video interviews and a detailed newsletter can all be downloaded free at www.makewoodwork.co.uk

About The Wood Panel Industries Federation (WPIF)

The WPIF represents the wood panel manufacturing sector in the UK which occupies seven sites and supplies approximately 60% of the UK demand for wood-based panels. Each of these sites is a major player in the local economy; most with workers from within a small catchment area, and in many cases provide employment to a number of members of the same family. There are four manufacturing companies based in the UK :

·          Egger (UK) Limited in Hexham, Northumberland, employs 575 people

·          Kronospan Limited in Chirk, Clywd, employs 555 people

·          Norbord Limited employs 988 people across three sites at South Molton , Devon ; Cowie, near Stirling and Dalcross near Inverness

·          Sonae in Knowsley, Merseyside, employs 225 people

 

About Europe Economics

Europe Economics is an independent private sector economics consultancy which specialises in regulation, competition policy and public policy issues.  The firm advises a wide range of clients including governments and regulators, the European Commission and Parliament, leading law firms, private sector companies and representative trade bodies.

 

About CarbonRiver

CarbonRiver’s market leading IP and world class expertise delivers a powerful turnkey solution for high integrity, efficient carbon accounting and emissions management for Enterprises and Supply Chains, Products and Services. Its comprehensive approach enables companies to make both cost and emissions savings, and simultaneously demonstrate responsibility and good stewardship.

 

Contacts:

Media:

FD

Oliver Williams            0207 269 7294             oliver.williams@fd.com

Christopher Clark       0207 269 7201             christopher.clark@fd.com

 

Wood Panel Industries Federation:

Alastair Kerr                   01476 563707              akerr@wpif.org.uk

  • Members of the Wood Panel Industry All Party Parliamentary Group highlight the number of livelihoods at stake. (Left to right) Guy Opperman MP (Con Hexham), group chairman the Rt Hon Anne McGuire MP (Lab Stirling), Cathy Jamieson MP (Lab Kilmarnock and Loudoun), Sandra Osborne MP (Lab Ayr, Carrick and Cumnock) and Susan Jones MP (Lab Clwyd South)
  • The spiralling development of large-scale wood fired energy plants in the UK threatens 8,700 UK jobs and risks a six million tonne increase in UK carbon emissions. Pictured are (Left-right) Peter Townson of Sonae, Alastair Kerr of the WPIF, John Paterson of Egger and Steve Roebuck of Norbord.
Large-scale biomass threatens 8,700 UK jobs... and risks a 1% increase in UK emissions - Click to make an enquiry
Members of the Wood Panel Industry All Party Parliamentary Group highlight the number of livelihoods at stake. (Left to right) Guy Opperman MP (Con Hexham), group chairman the Rt Hon Anne McGuire MP (Lab Stirling), Cathy Jamieson MP (Lab Kilmarnock and Loudoun), Sandra Osborne MP (Lab Ayr, Carrick and Cumnock) and Susan Jones MP (Lab Clwyd South)
Share |