Cost Comparison with Other Fuel Sources

There are a number of good reports and cost comparisons available therefore we have not produced our own. One of the most comprehensive and usable is the Wood energy calculator/comparator which can be found on the Coed Cymru website.

Costs of Establishment and Growing Energy Crops

The most significant cost associated with energy crops production is the initial establishment of the crop, in particular, the planting material. There have been a number of studies and reports investigating these associated costs and predicting the likely changes to these costs as the industry becomes established and market forces and infrastructure improvements drive costs down.

To summarise some the range of most recent figures for crop establishment, harvesting and annual maintenance;

Short rotation willow coppice - £1100 (ESD) to £1900* (ADAS) per hectare to establish (£55-£95 per hectare annually over the crops 20 year life cycle), £150/ha harvesting (annual if grown in rotation or every 3-4 years) and £50/ha annual maintenance.

Miscanthus - £1600 ( Cambridge University report) to £1800 (ADAS) per hectare (£80 - £90 per hectare over the crops 20 year life cycle), £100/ha harvesting (annual) and £30/ha annual maintenance.

Reed Canarygrass - £300 - £400 per hectare establishment (£60 - £80 per hectare over the crops 5 year life cycle), £100/ha harvesting (annual) and £30/ha annual maintenance.

These figures come from a wide range of sources and our own trial figures, they include;

Site Preparation (Cultivation)

Planting materials & Planting

*Rabbit Proof Fencing (not always required but advisable for SRC)

Herbicide applications
Fertiliser (if necessary)
Pest and disease control (if necessary)

Grants

The Energy Crops Scheme ( ENGLAND ONLY) - A total fund of £29m is available until 2006 for the following grants for England only, at present.

• Grants ranging from £1,000-1,600/ha for the establishment of short rotation coppice(SRC) willow or poplar crops, and £920/ha for the establishment of Miscanthus crops.
• Grants of up to 50% of the total cost of establishing SRC producer groups.

Bioenergy Capital Grants Scheme -A total fund of at least £66 million which will provide assistance for the installation of large scale heating systems, large scale electricity generating units and large and small scale Combined Heat and Power (CHP) units.

The Rural Recovery Farm Woodlands and Biomass Scheme - Assisting in the maximisation of Welsh woodland resources includes grants for machinery, research, marketing and promotion of forestry and biomass. Contact WDA (contact sheet).

Woodland Grant Scheme – Funding for planting new broadleaf woodlands, £600/ha for Short Rotation Willow Coppice. Contact the Forestry Commission. This scheme finished in 2006, being replaced by the Better Woodlands for Wales Scheme which will not include an SRWC grant.

WEBS – Wood Energy Business Scheme (WALES) – Financial and administrative assistance with setting up a wood energy business (defined as using a local supply of wood (not energy crops) converted through a CHP or boiler system and supplied to a local end user).

Bio-Energy Infrastructure Scheme – Grants available for capital costs, equipment, feasibility, establishment of producer groups. Limited funding now left. Contact DEFRA.

Energy Aid Payment (Rural Development Action Plan) - £31/ha for all energy crops but needs a contract for a “first processor”. Alternatively set-aside can be claimed.

Single Farm Payments - All energy crops are eligible, see DEFRA.

Market Values and Incomes

Prices per dry tonne of energy crop depend on the individual arrangements or contracts made between the end user and the grower or biomass supply company. Currently economic models work on figures between £25 and £40 per tonne of dry matter.

As an example of a current scheme, ESD has 2 contracts for SRWC suppliers for Didcot Power Station, a payment per oven dry tonne or payment per hectare scheme.

The first contract offers £26/tonne for delivered material plus Energy Aid Supplement of £31/ha. The grower undertakes the preparation but ESD organizes the planting and husbandry for a one-off fee or £150/ha and subsequent £30/ha/yr, they offer a harvesting service at £10/ha.

The second contract offers £95/ha/yr plus the £31/ha energy crops supplement with the same planting and husbandry arrangements except that ESD arrange harvesting and delivery.

More details of this and other similar contract schemes are available on the internet.