Alastair Kerr Director GeneralWood Panel Industries Federation

Industry Overview

Wood Panels: ubiquitous but generally unseen

Wood supply and the impact of energy policy

7 Manufacturing sites 8700 FTE jobs Turnover £520million Output 3.4Mm³ Supply two thirds of

the UK consumption. Wood Consumption

4.1Mt Largest recycler of

wood

Renewables Obligation Renewable Heat Incentive (2011) Climate Change Levy Carbon Reduction Commitment EU ETS

Forth Dundee 100MWForth Rosyth 100MW

Forth Grangemouth 100MWForth Leith 200MW

RWE Markinch 50MW

RES Blyth 100MWMGT Tyne 300MW

MGT Teesside 300MW

Sembcorp 30MWTadcaster brewery 3MW

Drax Selby 300MWDalkia Pollington 52MW

Drax Immingham 300MW

RWE Stallingborough 65MW

Peterborough 79MW

RWE Tilbury 750MW

Express Tilbury 60MW

SSE Slough 35MWHelius Southamption 100MW

Helius Avonmouth 100MW

Eon Portbury Dock 100MW

Nevis Power 50MWWestern Wood 14MW

Prenergy 300MW

Eccleshall 3MWUPM Shotton 20MW

Anglesey Aluminium 300MW

Iggesund 50MW

Balcas 3MW

Stevens Croft 44MW

UPM Irvine 26MW

Royal Brewery 3MW

Operational 181 MW – 1.8 million tonnes timberApproved 2404MW – 24 million tonnes timberPlanning application submitted 1547 MW – 15.5 million tonnes timber

SSE Ferrybridge 95MW

UK wood fired electricity plant - August 2011Overlaid with location of wood panel plants

Total potential timber requirement 41.3 million tonnes

Panel manufacturing site

•Switch from panels to burning increases carbon by 6M tonnes p.a.

•Over the cycle of re-growth this is >200M tonnes

•State Aid subsidies will be £300-400 million p.a.

•State Aid over cycle of re-growth will be circa £12 billion!

That’s for the 4Mt of wood used in Panelboard!

Wood costs will treble and will be passed on Manufacturing investment will be lost Vital manufacturing jobs will be lost (overall net

loss) Negative impact on the balance of payments All to deliver less than 0.5% of UK electricity

needs

In respect of electricity only link the subsidy to transport

Link subsidy to minimum efficiency standards

Benefits Levels the playing field but doesn’t prevent wood

burning electricity plant from being built or UK wood from being used for electricity

Encourages support for CHP Doesn’t impact on heat only – (RHI) Doesn’t impact on existing plant

Level Playing Field