Uncertain Alkane slips £7m into the red

Alkane Energy, the Edwinstone-based independent power producer, has slipped into the red after making substantial losses last year.

The firm, which was taken back into private hands last October, made a loss of almost £7.2m for the year-ending 31 December 2015 – compared with a profit of £3.4m for 2014.

Alkane, which owns 28 energy parks across the UK saw its energy output rise from 195GWh in 2014 to 218GWh last year. However, it said that it suffered depletion on some of its sites caused it to lose money over the year.

This was added to when on 29 October last year the company was bought by Balfour Beatty for £61.4m and transaction costs of £1.7m were added to the profit and loss account.

A statement from Alkane Energy read: “The UK energy market continues to face a number of challenges including a decline in North Sea oil and gas production and a tightening supply of margin in the electricity market. The Group is cash positive with funds being re-invested in generation assets. The business is seeking to develop scale through organic and acquisition expansion and we remain confident in our growth strategy to take advantage of the changing industry fundamentals over the coming years.”

Despite this, Alkane said: “Uncertainty around UK energy policy could result in significant changes in the business environment in which the Group operates.”