Drax, the UK’s largest power producer, faces renewed scrutiny over its sustainability practices following revelations that internal executives expressed doubts about the company’s claims. While publicly denying allegations of sourcing wood from old-growth forests, court documents reveal that some senior leaders privately worried about the adequacy of evidence supporting these sustainability assertions.
Allegations and Response
In October 2022, a BBC Panorama documentary accused Drax of using wood from environmentally significant forests in Canada to fuel its biomass operations. The programme specifically highlighted pellet production sites in British Columbia. In response, the company’s chief executive, Will Gardiner, reaffirmed Drax’s commitment to sustainability in a letter to then-energy secretary Jacob Rees-Mogg, insisting that the company adhered to governmental subsidy requirements. He stated, “I have positioned sustainably sourced biomass to be at the heart of Drax,” emphasising the importance of governance and traceability.
Despite these assurances, court documents provided to various news outlets, including the Guardian, cast doubt on Drax’s ability to substantiate its claims. Executives within the company reportedly raised alarms that the evidence backing their sustainability narrative was insufficient, particularly regarding the origins of the biomass used.
Internal Doubts Surface
The concerns became particularly pronounced following the BBC broadcast. Rowaa Ahmar, Drax’s former head of public affairs, alleged that she was dismissed after alerting Gardiner to the potential misleading nature of the company’s public statements. Ahmar testified that the fallout from the documentary led to a “level of chaos” within Drax, as her investigations indicated that the company may have sourced wood pellets from forests that included trees up to 250 years old.
According to Ahmar’s evidence, Drax’s head of compliance acknowledged in an internal communication that the company had likely been burning pellets sourced from old-growth forests since at least 2019. This admission raised concerns about whether Drax had significantly misreported its biomass sourcing data, which would violate the conditions attached to the subsidies it receives.
The Regulatory Landscape
Drax has benefited from over £7 billion in subsidies funded by household energy bills, contingent on the use of low-value wood from sustainable sources. However, the company’s model, which involves importing vast quantities of wood pellets across the Atlantic, has faced ongoing scrutiny regarding its sustainability. In the aftermath of the Panorama allegations, Drax maintained that 80% of its biomass pellets were made from sawmill residues, with the remainder classified as waste material.
The UK energy regulator, Ofgem, conducted a separate investigation into Drax’s practices, concluding in August 2024 that while there were inadequacies in data governance and controls related to wood sourcing, there was no evidence of improper subsidy issuance. Drax has since agreed to pay £25 million in compensation for the identified breaches.
Continuing Investigations
The Financial Conduct Authority is currently investigating historical statements made by Drax regarding its pellet sourcing practices. As the regulatory landscape continues to evolve, Drax’s previous position as western Europe’s largest coal-fired power station, now transitioned to biomass, remains under a critical lens.
Despite the company’s assertions of compliance and sustainability, the revelations from internal documents and ongoing inquiries highlight a growing tension between public claims and operational realities.
Why it Matters
The revelations surrounding Drax’s sustainability claims are significant as they underscore the broader challenges facing the renewable energy sector. Trust in sustainability claims is crucial for both consumer confidence and regulatory accountability. As the world increasingly turns to renewable energy sources, transparency in sourcing practices is essential to ensure that the transition is genuinely beneficial for both the environment and the economy. The implications of Drax’s situation may resonate across the industry, prompting calls for enhanced oversight and clearer standards in biomass sourcing.
