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Arbre Project

Volume 406: debated on Thursday 12 June 2003

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To ask the Secretary of State for Trade and Industry (1) whether the Arbre project will qualify for bioenergy funds under the (a) Bioenergy Capital Growth Scheme and (b) Energy Crops Scheme to help farmers and foresters establish energy crops; and what representations she has received to make these grants to the Arbre project; [118405](2) when the Arbre project will be in position to take willow coppice to the Vale of York; [118406](3) whether farmers with contracts to supply willow coppice to the Arbre project may be compensated under the

(a) Bioenergy Capital Grant Scheme and (b) Energy Crops Scheme following the plant going into liquidation. [118407]

The Bioenergy Capital Grants Scheme is a joint DTI/New Opportunities Fund scheme to provide support towards the capital costs of new bioenergy plant. All of the available £66 million of funding has been allocated to 21 projects throughout the United Kingdom.

Defra's Energy Crops Scheme provides grants to establish crops for any valid heat, combined heat and power and electricity generation end use. Grants of £280,000 have been made to plant 280 hectares of short rotation coppice (SRC) under the Energy Crops Scheme. 1,157 hectares of SRC had previously been planted under the Forestry Commission's Woodland Grant Scheme at a cost of approximately £1 million.

Funding for the capital cost of the Arbre demonstration project has come from the European Commission and the project partners, with support for the establishment of energy crops coming from the Forestry Commission and Defra.

DTI have not received a request for assistance from the purchasers of the Arbre plant, but have agreed to consider any proposals to minimise the technology risk of taking the plant to full operation. Any support would be from our research and development programme.

In terms of the farmers with contracts to supply the Arbre project, that is essentially a commercial undertaking between the farmers and the owners of the plant. No compensation would be paid from the schemes mentioned.

Defra's Energy Crops Scheme provides a one-off payment when the crop is established. It is a condition of the grant that the crop is used to produce energy. Arbre growers are setting up a producer group to harvest and market their energy crops with assistance from the Energy Crops Scheme and Objective 1 funding. The scheme does not restrict growers to supplying the Arbre plant and they can seek alternative markets.

Whether the crops come from the Vale of York is a matter for the owners of the Arbre plant as they decide on a route to commercial operation of the plant.