Farmers will grow crops to be burned for energy by Drax at its north Yorkshire power plant under a new deal.
The company that owns the plant in Selby will work with the National Farmers Union on cultivating crops that can be turned into biomass pellets or fuel.
Energy crops, typically high-yield plants that absorb large amounts of carbon dioxide, can be burned while producing power on a carbon neutral, or even carbon negative, basis.
Drax’s plant provides as much as 6pc of the UK’s electricity. Designed to burn coal, it has largely switched to burning biomass, mostly in the form of wood chip pellets imported from the US.
Jason Shipstone, Drax’s chief innovation officer, said the company could cut its supply chain emissions if it was able to source its biofuel in the UK rather than ship it from overseas.
“By encouraging British farmers to plant energy crops here in the UK, the agricultural sector can join the bioenergy industry, and support national efforts to address the climate crisis, driving down emissions and building back greener,” he said.
Growing biofuels also provides an opportunity for UK farmers to find new streams of revenues.
The UK’s reliance on the Drax plant was underlined last week amid soaring gas prices, with a 70pc rise since August, combined with poor wind power generation and a gloomy summer dimming the solar power output.
Last week Drax shares jumped as much as 15pc as higher energy prices and low gas stocks forced Britain to turn to other power sources. This month the UK was forced to fire up some of its last coal burning stacks to keep the lights on.
National Grid has asked coal burning plants to be on standby to balance the UK’s electricity demands at short notice. Operators are in line to be paid up to £4,000 per megawatt hour to meet demand.
Energy crops absorb large amounts of carbon dioxide, allowing them to be used for fuels on a carbon neutral basis. Some, such as elephant grass, are even argued to be carbon negative.
Drax also plans to spend £2bn on a carbon capture storage project to harvest emissions from its plant and bury them deep under the North Sea. Burning more efficient forms of biomass, and then storing their emissions, could reduce the carbon footprint of the UK’s energy sector. It expects its first unit to become operational by 2027.
Stuart Roberts of the NFU said: “By working with Drax Group, we can unlock this potential and ensure our farmers are ready to take advantage of the opportunity energy crops create, one which will provide a boost to both farm businesses and the UK’s climate credentials.”