UK's flagship biomass power plant closes amid policy confusion.

Guardian: “This is no ordinary closure. Tilbury claimed latterly to be the biggest biomass plant in the world, providing 10% of Britain’s renewable power, and was a pioneer in the field of low-carbon generation.” “But the RWE Npower-owned electricity generator has failed to qualify for government incentives to burn wood instead of coal and has been forced into inaction.
….RWE is estimated to need around £450m to turn Tilbury into a full-time wood-burning plant. It made the switch from coal to biomass in 2011 but needs to make much wider changes to the plant if it is to operate for the next decade.
Staves says new investors were ready alongside RWE – but only if Tilbury was eligible for the new “contracts for difference” subsidies that are being given to Drax in North Yorkshire and other rivals moving into biomass.
This has not happened because of an over-legalistic interpretation of the new policy, says Doyle-Price, even though Tilbury was given subsidies through the renewable obligation certificate scheme in the past.
A Decc spokesperson said plants which had already been receiving support as biomass conversions under one subsidy regime were not eligible to switch to the contract for difference, but added: “The decision to close Tilbury is a commercial one taken by RWE and we respect that judgment.”
….The American shale gas revolution has forced low-priced coal out of its home market – in the process making burning gas in Britain the relatively more expensive option.
That has had the unexpected result of encouraging utilities in the UK to mothball or shut down their gas-fired boilers. RWE has stalled plans to construct a new 2,400MW gas-fired plant at Willington, in Derbyshire, while Centrica and GDF Suez have both scaled back their capacity.
….A company like RWE might in the past have considered funding a new Tilbury biomass plant out of its own finances but now would need to borrow, at a time when its share price has plummeted. Fellow German utility E.ON has seen its market capitalisation fall from a peak of €105bn (£90bn) a few years ago to €26bn, while EDF of France – another main player in the UK – has seen its value fall from €150bn in 2007 to barely €30bn today.”