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UK power company to build US bioenergy plants with CCS

UK-based power firm Drax Group is advancing two $2bn bionergy plants with CCS in the US South, with an additional nine sites under evaluation in North America.

UK-based power company Drax Group said yesterday it is seeking to build two bionergy plants with carbon capture and sequestration in the US, with an additional nine sites under evaluation in North America.

Drax is developing plans for a new-build BECCS power unit capable of producing 2 TWh of renewable electricity from sustainable biomass and capturing 3 Mt of carbon per year.

According to a stock exchange filing, two initial sites in the US South have been selected and are progressing to option, although the precise details remain commercially sensitive. The two sites combined could enable the capture of 6 Mt of carbon per year by 2030.

Total investment would be in the region of $2bn per plant with a target FID in 2026 and commercial operation by 2030. The capital cost reflects the construction of new-build power generation as well as carbon capture and storage (CCS) systems.

The design of new-build BECCS enables a wider choice of biomass materials, including non-pelletized material, such as woodchips. Drax aims to locate new plants in regions which are closer to sources of sustainable biomass and T&S systems to permanently store CO2. This is expected to significantly reduce the operating cost of new-build BECCS compared to retrofit, as well as carbon emissions in the supply chain.

The group is continuing to evaluate nine further sites in North America, creating a pipeline of development opportunities into the 2030s.

The commercial model for US BECCS includes Power Purchase Agreements, long-term CDR offtake agreements and a direct pay tax incentive under the Inflation Reduction Act of $85/tonne, according to the filing.

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