Andy Koss, Drax’s CEO Generation, said that the company wanted to look after the staff affected and will start a consulation process a year before the redundancies are implemented.
Almost 50 years of coal-fired electricity generation at Drax Power Station, near Selby, is expected to come to an end in March 2021 - marking a major milestone in the company’s ambition to become carbon negative by 2030.
It means the country’s largest power station will stop using coal well ahead of the government’s 2025 deadline, making an even bigger contribution to the UK’s efforts to achieve net zero.
Drax Group’s 2,900-strong workforce operate across three principal areas of activity – electricity generation, electricity sales to business customers and compressed wood pellet production.
Mr Koss said: “Clearly coal has been a fuel of the past for some time. We have a secure future here and announced a good set of results today.
“We have always been one step ahead of the curve and we have a long future ahead of us.”
He said the costs of running coal are higher than the revenue the company expects to generate from coal burning.
Drax burned around 200,000 tonnes of coal last year compare with around 9.3 million tonnes in 2005. Coal now only accounts for 4 per cent of power generated by Drax.
It is estimated that Drax now supplies around 5 per cent of all the UK’s energy and 12 per cent of its total renewable energy.
Drax is talking to the government, trades unions and industrial businesses across the North about joining with Drax in establishing a new Zero Carbon Skills Taskforce to help people in the region gain the skills and expertise required to seize new job opportunities as the UK moves towards a net zero economy.
Mr Koss, who first joined the business in 2005, said: “The change has been profound. We recognised soon after I joined the need to reduce carbon emissions.
“We want to retrain people and give them the skills that are required in the future. We see a fantastic opportunity to grow these skills and train for the future.”
The decision to stop using coal at Drax comes after a comprehensive review of its operations. Drax does not expect to use coal after March 2021, but will ensure its two remaining coal units remain available until September 2022 in line with its existing Capacity Market agreements.
Drax Power Station first started generating electricity using coal in the 1970s. Once the second half of the power station was built in the 1980s, it became the largest power station in the UK with the capacity to generate electricity for six million households.
Over the last decade four of the power station’s six generating units have been converted to use sustainable biomass, delivering carbon savings of more than 80% compared to when they used coal.
This has transformed Drax to become the UK’s largest renewable power generator and the biggest decarbonisation project in Europe.
The Norwegian Sovereign Wealth Fund, Norges Bank Investment Management, recently announced it was revoking an exclusion of Drax Group from its investments, recognising the company’s move away from coal to biomass, which delivers carbon savings of more than 80%.
Drax supports STEM (Science, Technology, Engineering and Maths) education and employability initiatives in the communities local to its operations. In 2019 it recruited 18 apprentices across the Group including 13 at Drax Power Station. It also works with schools and colleges to deliver exciting STEM education opportunities and careers events and activities, which promote diversity and inclusion.
More than 9,500 people visited Drax Power Station in 2019, many of whom were students.