Rising power prices augur well for energy company

The AIM-listed company owns and operates power generation plants, using coal-mine methane as fuel, and has several interests in Yorkshire.

John Lander, the chairman, told the annual general meeting that power prices are widely expected to rise in the medium to longer term, but he added that wholesale prices are significantly lower than 2009 at an average of 40 per megawatt hour.

Electricity sales contracts are in place for 78 per cent of Alkane's existing portfolio for the current financial year, he added.

The company continues to expand its coal-mine methane capacity with production already commenced at its newest site at Florence, Staffordshire.

Alkane has two more sites under construction, at Kings Mill, in Nottinghamshire, and Newmarket, in West Yorkshire.

The company is "making good progress" in its contract with Leeds-based GDF for conventional gas power generation with potential to expand capacity, said Mr Lander.

Alkane is also working on biogas projects in a partnership with The TEG Group and said that it is "actively pursuing" other opportunities in this area.

Turnover last year was 6.3m, up 21 per cent, with record underlying profit of 2.4m, up 71 per cent.

Shares in Alkane Energy closed at 16.83p, up 0.5 per cent.