Drax abandons plans for new gas-fired power plants as it reveals Covid-19 impact

Britain is aiming to close all coal-fired power plants by 2024 as part of its efforts to meet its climate target of net zero emissions by 2050.

Drax, which owns and operates the power station in North Yorkshire, has already converted four of its six coal units to use sustainable biomass. The remaining units are set to close by the end of March 2021.

The company had previously said it could replace the remaining units with gas plants.

Will Gardiner, CEO of Drax Group, said: "Our focus is on renewable power. Our carbon intensity is one of the lowest of all European power generators. We aim to be carbon negative by 2030 and are continuing to make progress.

"We are announcing today that we will not develop new gas fired power at Drax. This builds on our decision to end commercial coal generation and the recent sale of our existing gas power stations.

“The proposed acquisition of Pinnacle Renewable Energy will position Drax as the world’s leading sustainable biomass generation and supply business, paving the way for us to develop bioenergy with carbon capture and storage (BECCS) – taking us even further in our decarbonisation.”

Drax plans to become a carbon negative company by 2030, using technology it is developing to capture, store and use emissions from the biomass plants.

Developing new gas plants would not fit with this strategy, Mr Gardiner said.

He added: “The future of gas power generation fuel is getting shorter all the time.”

Drax reported a £235m loss before tax, after taking a £60m hit due to the coronavirus.

The power producer said the pandemic-related loss came mainly from its customer business, which sells power, gas and energy services to small to medium-sized companies.

“Drax has supported its customers, communities and employees throughout the Covid-19 pandemic and I want to thank colleagues across the group for their commitment and hard work over the last year," Mr Gardiner said. "We have delivered strong results, a growing dividend for shareholders and excellent progress against our business strategy."

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