An independent, third-party economic analysis has shown that Drax Group, a leader in sustainable biomass, could contribute more than $1 billion in total across four southeastern states in 2023, including $425 million to the region’s GDP.
Conducted by a team of data scientists and PhD economists at Chmura, the analysis measured the economic impact of Drax’s biomass operations in Alabama, Arkansas, Louisiana and Mississippi, as well as well as indirect revenues of other businesses supported by Drax’s operations. The four states are home to Drax’s North American operations that produces sustainable biomass.
Sustainable biomass uses harvest residuals and low-grade wood, such as tops and branches, low quality trees or parts that are diseased or misshapen. This market for low-grade wood helps improve the health and productivity of forests while providing rural counties with a new income stream.
Other highlights from the report included figures on Drax’s history of investment in the region and contribution to key industries:
- From 2013-2022, Drax has invested $884.1 million in the four states, developing wood pellet plants, a port facility and a corporate office.
- From 2013-2022, capital expenditure for all Drax facilities is estimated to have had cumulative economic impacts of $368.5 million in spending and $184.7 million in GDP in the four states.
- The cumulative economic impact of Drax’s operations from 2023 to 2030 is estimated to be $8.3 billion in total spending and $3.4 billion in GDP to the four states.
“At a time when many families are facing economic hardship, we were very proud to see how sustainable biomass production is providing a multimillion-dollar boost to rural communities” said Matt White, Executive Vice President of North America Operations for Drax. “Drax is committed to ensuring the biomass we source delivers positive outcomes for the climate, for nature and for the communities in which we operate.”
Drax aims to increase its global pellet production capacity from around 5 million tons to 8 million tons by the end of this decade.
Sustainable biomass is set to play an even larger role in combating climate change in the years ahead.
“Biomass is a reliable renewable power source and, when paired with carbon capture and storage technology, it can permanently remove CO2 from the atmosphere, which will help the world reach its climate targets,” White said.
Drax is pioneering a carbon removals technology – bioenergy with carbon capture and storage (BECCS), which will permanently remove millions of tons of carbon dioxide from the atmosphere while at the same time generating renewable power.
“With the right support from governments, Drax stands ready to invest billions in deploying BECCS at scale across the globe to cut carbon emissions and generate renewable power for millions of homes and businesses,” said White.
A recent study published by the National Renewable Energy Laboratory (overseen by the U.S. Department of Energy) forecast that to deliver the goal of 100% clean electricity by 2035, the country must start deploying BECCS as soon as 2026.
