Drax likely to proceed with 2 additional power unit conversions

By Staff | September 25, 2014

In early 2013, Drax Group plc converted one of its six power generation units to biomass, and has plans to convert at least two additional units. The U.K. government was expected to support the two additional unit conversions through early Contracts for Difference (CfD) under the Final Investment Decision Enabling mechanism.

In April, the U.K. Department of Energy and Climate Change announced it would award a CfD to only one of those two conversions. Drax appealed the decision and received a favorable ruling from the U.K. High Court. The DECC, however, appealed that decision, and the U.K. Court of Appeal ruled in its favor. In August, Drax announced it would not appeal that decision.

The company is currently expected to proceed with both biomass conversions.  During a recent investor presentation to discuss financial results for the first half of the year, Dorothy Thompson, chief executive of Drax, said the company is confident it will convert at least three of its six units to biomass. The second unit conversion will now likely be supported by the Renewables Obligation.