The link between rising atmospheric greenhouse gas concentrations and global climate change is now widely accepted by scientific and political establishment (e.g. IPCC reports, 2001¹) Leading arguments have been publicly well rehearsed, and the urgent need to stabilise concentrations of greenhouse gases released to the atmosphere through human activity, is becoming increasingly accepted. It has been proposed by many respected luminaries that climate change, and the mitigation of it, is one of the great challenges facing the human race in the early decades of the new millennium, perhaps the greatest².

The leading socio-economic driver for renewable energy solutions, and until recently, the leading barrier to their widespread deployment, is the global value of crude oil. This has in past decades averaged a sufficiently low level that it served as a severe disincentive to the development of more expensive bioenergy options. However, if the high current price of crude oil becomes a sustained trend, as seems inevitable, renewable energy options, including biogas, will become increasingly viable. It has been proposed by industry experts³ that products marketed on the basis of their environmental credentials rarely achieve significant market share or sustained success: economic competitiveness (within a suitable policy framework) will determine the wide market success of biogas solutions.

The socio-economic case for biogas is hardening, and this has coincided with increasingly strong regulatory drivers. In 2003, the Government published its Energy White Paper ‘Our energy future – creating a low carbon economy’, setting out its policy on energy with four goals:

1. to put the UK on a path to cut its CO2 emissions by some 60% by about 2050, with real progress by 2020;
2. to maintain the reliability of energy supplies;
3. to promote competitive markets in the UK and beyond, helping to raise the rate of sustainable economic growth and improve productivity; and
4. to ensure that every home is adequately and affordably heated.

In working towards a 60% reduction in UK CO2 emissions by 2050, the Government has committed to the target of 10% of the UK’s electricity consumption to be supplied through renewable resources by 2010, rising to 20% by 2020. This is in the context of an existing renewables contribution to electricity production of 1.8% in 2002/03⁴.

While biogas is typically a distributed resource, it is increasingly recognised that the potential for microgeneration of energy is very great, possibly assuming a majority of the UK’s present 380 TWh per annum needs.

Recognising that achieving the goals set out in the white paper cannot be achieved by any one body, the white paper announced the creation of a Sustainable Energy Policy Network (SEPN), a network of policy units from across Government departments, the devolved administrations, regulators and key delivery organisations that are jointly responsible for delivering the White Paper. SEPN was formally launched on 4th June 2003.

As a driver for the early targets, the UK Renewables Obligation (RO) regime⁵ was introduced in April 2002 (the Scottish Renewables Obligation Scotland (ROS) was in place in 2000) setting out incentives for electricity providers to provide a percentage of their energy from renewable sources, ramping from 3.0% in 2003/04 to 10.4% in 2010/11. Eligible renewable sources include:

1. landfill or sewerage gas;
2. onshore and offshore wind;
3. Geothermal
4. Tidal, tidal stream or wave power;
5. hydro power (stations exceeding 20MW or more only eligible if commissioned after 1st April 2002);
6. Photovoltaics;
7. Co-fired biomass (any biomass up to 2009, but energy crops must constitute 25% of biomass by 31st March 2009, 50% by 31st March 2010, and 75% by 31st March 2011. Co-firing ceases to be eligible for Renewables Obligation Certificates (ROC) after 31st March 2016;
8. other biomass, including waste (non-fossil-derived only);
9. energy crops.

The Government also supports the development of renewable energy in the transport fuels sector, currently through a 20p/litre duty incentive on biofuels. In late 2005, the Transport Secretary announced a Renewable Transport Fuels Obligation: by 2010, 5% of road transport fuels will be required to come from renewable sources (the means for implementing the RTFO are still being discussed, no targets likely to be required before 2008). This signals a major regulatory driver for UK biofuel (e.g. ethanol and biodiesel) production and associated R&D. Due to difficulties associated with implementation, there is currently no RO for heat generation, either for dedicated heat production or the heat contribution to CHP and, therefore, little regulatory incentive for renewables in the heat sector.

The Renewables Innovation Review, which reported in 2004 was set up to identify the key technologies for the delivery of the UK renewables targets, identify barriers and identify the most cost effective Government measures to facilitate delivery of the UK targets. The review found that biomass, including landfill gas, currently accounts for the largest percentage of renewable electricity supply, but that several contributory sources of biomass energy were constrained by limited resources (e.g. landfill gas) or by regulation (co-fired biomass).

Taking a broad view, the review concluded that there is sufficient practical wind resource to fulfil the 2010 and 2020 targets, and that wind power is currently the only economical and scaleable technology under the current RO regime, given the right incentives, financial framework and removal of institutional barriers. Other experts with a broad sector overview are less convinced of the arguments for wind power leading the renewable energy vanguard. However the review concluded that there was not sufficient potentially harvestable capacity for wind power alone to facilitate the 2050 CO₂ reduction aspirations, and that it was clear that the development of other sustainable, affordable, low carbon energy technologies will be a major challenge for the UK in meeting its longer-term aspirations towards a low-carbon economy, and to ensure reliability of energy supply through diversity of solutions.

In addition to the recent announcement of a TRFO, there are increasing indicators that the Government views biogas as an important part of an integrated low-carbon economy. The Royal Commission for Environmental Pollution (RCEP), chaired by Sir Tom Blundell, which has undertaken several studies informing Government energy policy, presented an influential special report on biomass as a renewable energy source in 2004⁶. This report set out the strong potential role of bioenergy in making a significant contribution to the UK’s renewable energy portfolio, and making a number of recommendations regarding the removal of regulatory and socio-economic barriers to the development of the industry. The conclusions and recommendations were received very positively by the Government. More recently, the Biomass Task Force, led by Sir Ben Gill, was commissioned by the Government to identify measures to stimulate the development of biomass energy. Reporting in October 2005, the Biomass Task Force focused particularly on the issue that whilst biomass is unique as the only widespread source of high-grade renewable heat, which can effectively and efficiently save carbon at a favourable cost compared to other options, there has been a lack of recognition of the role of renewable heat in policy, and therefore no targets or concerted policy in this area. In light of the Biomass Task Force’s recommendations, there is likely to be an imperative for the creation of new policy in this area. Implementation of an RO (not favoured by the Taskforce) or other political drivers for a renewables contribution to heat production would clearly strongly favour bioenergy solutions, and political activity in this area may therefore strongly influence the market level and composition of bioenergy solutions. The Task Force made a number of recommendations to stimulate greater use of the UK’s biomass resource, largely aimed at improving the uptake and development of existing technologies and resources and resolving the current ‘chicken and egg’ problem of the UK biomass supply chain, and is likely to stimulate high-level policy responses.

The DTI has recently drawn together all policy work relating to bioenergy under the new bioenergy workstream of SEPN, providing focus and improved coordination for this area.

As part of the Spending Review 2004 outcome, the Government’s produced its ten-year investment framework for public and private science and innovation⁷, which makes several statements of particular relevance for renewable energy research:

1. Defra plans to alter the balance of its current science programme towards its environmental priorities. Top priority will be strengthening science and innovation in support of policy on climate change and energy in its broadest sense;
2. The Carbon Trust will continue its support for developers and co-investors to tackle climate change through discovery and development of low carbon technologies and businesses;
3. Defra will place increased emphasis on strategic partnerships/alliances, especially in environmental science, bioscience and the social sciences. Key components of this approach will include:
   1. direct funding for innovation to support policy needs and to develop new approaches to regulation that encourages innovative solutions;
   2. Support for technology transfer and innovation by business, especially the development of sustainable technologies.
4. Over the coming decade, the Government will work with partners in the private sector to improve the effectiveness of UK energy R&D investments overall, and the scale of these investments relative to the economic and environmental challenge facing the UK. Better dialogue between key funders of energy R&D will be central to the Government’s approach, with the UK Energy Research Centre representing a step forward in this respect.
5. Energy innovation will remain of the highest strategic priority and strategic importance for the UK, and globally, for decades to come.

The Scottish Executive is committed to promoting a wide range of renewables, including biomass, and set up the Forum for Renewable Energy in Scotland (FREDS), which has considered arboricultural issues, but to date has provided limited outputs relating to other energy crops. SEERAD’s 2005 Research Strategy⁸ set out the need to explore the potential for cost-effective non-food crop applications in Scotland. The Executive continues to work on a Scottish Biomass Action Plan and a Renewable Heat Strategy.

The Biomass Action Plan and the EU Strategy for Biofuels both confirm the central importance of biofuel and biogas for EU agricultural, transport and energy policy, and the European Biofuels Directive has been in place since May 2003, setting targets for increasing the use of biofuels in transportation.

An EU grouping of note is the European Climate Forum (ECF), brining together EU representatives of science, policy, industrial and other stakeholders to carry out joint studies contributing to the development of climate change mitigation and adaptation policies. The ECF met in late 2003 to consider the European Biofuels Directive, and its potential for climate protection. Consensus conclusions from the meeting included:

1. Central and Eastern Europe, the Accession States, are going to be key players in the biofuels industry, and must be engaged in the research;
2. Key challenges towards biofuel cost reduction and uptake include product and energy yield improvement, utilisation of bi-products and the development of fuel standards;
3. Until 2010 (in the short term), biodiesel, biogas and bioethanol from oil and sugar/starch crops are the most feasible option for biofuels for transportation.
4. Ecologists are concerned about the potential impact of intensive biomass agriculture on biodiversity and landscapes.

Several key issues of contention between stakeholders were also summarised, including:

1. The long-term direction of biofuels in transportation is contentious. There are strong voices for and against gaseous fuels, including hydrogen. The EU seems to have settled on a vision of a hydrogen economy, but there are serious issues of transport, storage, delivery and packaging to consider;
2. Biofuels are an opportunity to lower agricultural intensity. Plant breeders say yes, because crops can be designed to make more efficient use of resources. Agriculturalists and industrialists say no, there will be just as much pressure, if not more, to produce high yields, and there will certainly be greater demand on land, which may reduce un-cropped land and replace less intensive land uses.

The EU now supports biofuel research with the objectives of reducing greenhouse gas emissions, boosting the decarbonisation of transport fuels, diversifying fuel supply sources and developing long term replacements for fossil fuels. The production of biofuels from sustainable feedstocks could also benefit the economy in developing countries.

The Commission has published a new biofuels strategy, which has seven key policy areas. One of these, supporting research and development (R&D), aims to continue to support the development of an industry-led Biofuel Technology Platform, which will formulate recommendations for research in this sector. Major European biofuels stakeholders are represented including the agricultural and forestry sectors, food industry, biofuels industry, oil companies and fuel distributors, car manufacturers and research institutes. Other technology platforms such as Plants for the Future, Forestry-based Sector and Sustainable Chemistry will also increase the knowledge of biofuel production. Actions at European level (ERA-NET) in the field of biomass will further increase the cost effectiveness and coordination of activities.

The Commission also confirmed that biofuels will be a priority in the Seventh Framework Programme (FP7). Bio-refinery research (finding valuable uses for all parts of a plant) and second generation biofuels in particular will receive funding under FP7.

The other policy areas published in the strategy are: stimulating demand for biofuels; capturing environmental benefits; developing production and distribution opportunities; extending supplies of feedstock; enhancing trade opportunities and supporting developing countries.

1 See http://www.grida.no/climate/ipcc_tar/

3 View expressed in presentations at the Renewables East/HGCA-sponsored meeting ‘The commercial reality of a UK biofuel industry’, July 2005, Cambridge.

4 Ofgem statistics, DTI Digest of Energy Statistics, 2003.