Power generator Drax saw a rise in full-year profits and earnings, driven by higher renewable power generation from its biomass units.
The Selby-based power producer reported pre-tax profit of £14m for the year ended December 31, 2018. The business also generated a 9 per cent rise in full-year earnings to £250m.
Andy Koss, chief executive of Drax Power, the power generation aspect of the business, told The Yorkshire Post that Drax was “very pleased with strong growth”.
He said: “We would like to see continued growth in 2019. What we can see is that the power station is very well positioned for this year.”
Last year, Drax Group announced that it was acquiring a portfolio of assets belonging to Scottish Power for £702m.
Mr Koss said: “We’ve obviously got a lot of work to do on the integration.
“What we want to do is start viewing all the assets that we have now across the UK as a portfolio and really start to get the most out of them as a portfolio rather than a collection of assets. That will be a large piece of work throughout this year.”
The acquisition was completed in January after Drax revised the terms of the deal with Scottish Power owner Iberdrola to ensure it gets a rebate on lost capacity payments.
The Capacity Market, a back-up power scheme designed to avoid electricity shortages, was halted in November pending a further investigation by EU regulators.
Mr Koss believes the Capacity Market will be reinstated because its suspension is “very much a procedural point, it’s not related to the underlying nature of the Capacity Market itself”.
He added: “We’re confident it will come back. It’s just a question of timing.”
Mr Koss believes the issue will be resolved by the end of September.
Drax has converted four of its six power generating units to biomass. The company hopes to secure planning permits to convert the remaining two coal burning units as well.
Following the conversion of just one of the remaining coal powered units, Drax will be off coal, Mr Koss said.
“Our plan is really to move away from coal as quickly as we can,” he added.
Drax enjoyed a 64 per cent increase in pellet production to 1.351 million tonnes.
Will Gardiner, chief executive of Drax Group, said: “We commissioned our third pellet production plant, which contributed to our good results.
“After a difficult first quarter for our power generation business, we delivered strong availability and financial results.”
He added: “We are confident in our ability to continue growing our earnings and advancing our strategy through the year.
“We have attractive investment opportunities throughout our business, and while short-term uncertainty over the Capacity Market remains, we look forward to developing those opportunities in a disciplined fashion.”