Drax continues push to biomass despite challenging conditions

CHALLENGING trading conditions have continued for Yorkshire power station operator Drax but it says it has delivered good operational performance in the year to date from both coal and biomass generating units.

Expectations for the full year remain unchanged, Drax said this morning in an interim management statement for the period from 1 July 2014 to date.
 
Drax highlighted that it has continued to make good progress with its on-going transformation to a predominantly biomass-fuelled electricity generator. 
 
The first unit was converted fully to biomass in May 2013 and earlier this year, at the beginning of May, the second unit began to operate as an enhanced co-firing unit, burning at least 85% biomass. The unit was subsequently converted fully to biomass last month.

Drax’s third unit conversion was awarded an Investment Contract in May and subject to receiving State Aid clearance from the European Commission, Drax plans to convert the unit between July 2015 and June 2016.

Drax hit the headlines in the summer when it lost a court of appeal ruling over its eligibility for a major government contract and it resulted in the second unit conversion no longer being eligible for an Investment Contract .
  
Drax added that capital investment remains on schedule and budget and commissioning of the new on-site biomass facilities is complete and all four storage domes are now in service.
 
Drax also added that since 2013, the Office for Gas and Electricity Markets (Ofgem) has been investigating its non-compliance with the Community Energy Saving Programme (CESP). Ofgem is now concluding its investigation and enforcement could be in the form of a financial penalty.

The business will announce full year results in February 2015.