The UK government should rethink its subsidies for burning wood for fuel, former Conservative ministers and the net zero tsar have said. The energy company Drax, which burns forest biomass, made £893m in direct government subsidies in 2021. The level of support fell to £617m in 2022 as electricity prices exceeded an agreed “strike price” agreed to encourage renewable investment. Now senior Tories have asked the government to rethink its subsidies for Drax, which are paid for the supposed environmental benefits of burning wood. Ed Miliband, the shadow climate change and net zero secretary, also said a Labour government would review the subsidy scheme. The former business and energy secretary Jacob Rees-Mogg told the Guardian he was “concerned about the environmental benefits of Drax”, adding: “It is important that intention and reality combine to a real rather than a superficial advantage.” The former transport secretary Chris Grayling, who chairs the all-party parliamentary group on deforestation, said “we now need to start looking very hard” at the subsidies. “I know that the idea was conceived with the best of intentions, with a view to try to cut down traditional emissions, but it is not an ideal situation and we should be taking another look at it. It is not something we can stop overnight, but it is a serious discussion we need to have about how far we can carry on doing this.” He said he was concerned that using biofuels as a solution could lead to deforestation and take up land that could be used for other things. “It is one thing creating biofuels from waste, but when I speak to various sectors they champion biofuels as the way forward, but there is simply not enough land mass to produce that amount of biomass sustainably and it cannot be the solution. We have to be very circumspect about how much we can rely on biofuels.” This week ministers will have to respond to Chris Skidmore’s net zero review, and outline their biomass strategy. He told the Guardian the government should change its attitude to Drax and ban the burning of anything but waste products that cannot be used for anything else. Skidmore, the MP for Kingswood and chair of the net zero review, said: “I think we probably need a new taxonomy for biomass, which is too broad a term. Waste agricultural products that rot and produce methane need to be dealt with. “But wood that can be used for products shouldn’t be burnt. There is a reason why the net zero review constantly talked about sustainable biomass – we should have the equivalent of green/grey hydrogen for biomass that would make anything but residual waste unacceptable.” The environmental audit committee chair, the Tory MP Philip Dunne, agreed. He said: “There are so many different and existing demands on forests that must be balanced. This ranges from forests being a vital resource for people living in or nearby, to playing a critical role in combating climate change, supporting nature recovery, and in supplying timber for low carbon buildings. “But land is finite, and we must think smarter – in our buildings, when growing food and powering our homes – if we are to live sustainably while protecting precious ecosystems globally. As such, it is only sensible that we carefully consider biomass and other demands on our land.” Miliband said that in power, Labour would review the subsidies. He told the Guardian: “This is obviously something we need to look at closely as to what the future looks like. Bioenergy and biogas does have potential but we need to look at the sustainability of that, and that is what we are going to do.” Nina Skorupska, the chief executive of the Renewable Energy Association, which represents the biomass industry among others, said she thought Drax would still be operating in 10 years, and burning biomass, but that it was vital for it to pursue carbon capture and storage technology. “It will be difficult by 2035 for them to be progressing bioenergy without carbon capture. That’s a key technology that really has to come to the fore, to enable us to go and meet that next decade of challenge.” She added: “They [Drax] also have to be held to the highest standards on sustainability [of their fuel]. I know people will be watching very carefully that they do that.” A Drax spokesperson said: “Drax is the UK’s biggest producer of renewable and dispatchable electricity, playing a critical role in supporting energy security while displacing fossil fuels. Biomass is the only source of reliable, renewable energy and our conversion from coal to biomass is one of the primary reasons that the UK’s power sector has decarbonised as fast as it has over the last decade. “We are committed to ensuring the biomass we source delivers positive outcomes for the climate, for nature and for the communities in which we operate. Our methodology is aligned to the recommendations of leading scientific institutions like the United Nations’ Intergovernmental Panel on Climate Change (IPCC), and we have robust sustainability standards in place to ensure our biomass meets the strict sustainability requirements of the countries in which we operate.” A Department for Energy Security and Net Zero spokesperson said: “The UK only supports biomass which complies with our strict sustainability criteria. The use of biomass has helped to dramatically reduce the use of fossil fuels, reduced our exposure to volatile global gas prices, and provided an additional source of energy to bolster our energy security and independence. “Details of how biomass can further contribute towards both our energy security and net zero will be set out in our forthcoming biomass strategy.”