Drax battles tough markets

Power station Drax described 2016 as a pivotal year for the company despite very challenging '‹power and commodity markets'‹.'‹'‹

Drax is leading the energy revolution

​The group said that 65​ per cent​ of ​its​ electricity was generated from sustainable compressed wood pellets​ last year as it forges ahead with plans to ditch coal in favour of biomass.

​​Th​e North Yorkshire firm, once one of the biggest polluters in Europe, reported earnings of £140m in the year to December 31, in line with​ ​guidance, but still below ​the ​£169​m reported in 2015.

Sign up to our Business newsletter

Sign up to our Business newsletter

​Chief executive Dorothy Thompson said: "​2016 began with some of the most challenging ​​power and commodity markets I have seen in my career and in a similar way to 2015 this created a headwind to profitability.

​"​Operationally, performance across the group has been good.

​"​The strong operational performance across our business helped us to respond to the financial challenge posed by the difficult commodity markets and the​ ​removal of Climate Change Levy exemptions.​"​

​The group said its biomass units delivered a record level of renewable electricity.

In 2016 ​Drax​ produced 16​ per cent​ of the UK's renewable electricity from sustainable wood pellets.

​"​In total we produce enough electricity to power Sheffield, Leeds,​ ​Liverpool and Manchester together. We stand ready to do more​," said Ms Thompson.​

​"​Through our retail business we supplied 7.5​ per cent​ of electricity required by UK businesses, whilst our pellet supply business produced 607,000 tonnes of​ ​compressed wood pellets.​"​

Coal contributed just 9​ per cent​ of Britain's electricity during 2016​,​ ­down from 42​ per cent​ in​ ​2012.