Photographer: Luke Sharrett/Bloomberg

EU Backs RWE's Lynemouth Coal-to-Biomass Power-Plant Conversion

  • EU scrutinized U.K. government plan to help pay for power
  • EU says Lynemouth project furthers its climate, energy goals

RWE AG’s plan to convert its Lynemouth power plant in the U.K. to biomass from coal gained European Union approval after antitrust regulators said aid from the government for the project complied with their rules.

The EU scrutinized a proposal to pay a so-called contract for difference for power once Lynemouth is converted to a 420-megawatt plant fired by wood pellets, the trade bloc’s commission said Tuesday in an e-mail. The premium paid on top of the market price will expire in 2027 and presents no risk of overcompensation, it said.

“The project will further EU environmental and energy goals without unduly distorting competition” for other wood-based products , the commission said.

Lynemouth, situated on the Northumberland coast, will fire 1.5 million metric tons of pellets annually to generate 2.3 terawatts of low-carbon power, the commission said.

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