Drax is in talks to buy Scottish Power’s gas and hydroelectric power plants in its latest attempt to diversify beyond its main North Yorkshire power plant. The FTSE 250 energy company derives the vast majority of its profits from Britain’s biggest power station, but it is trying to broaden its business. Drax, which reported revenues of £3.7 billion and a pre-tax loss of £183 million last year, has converted two thirds of the Selby plant to burn biomass. This is reliant on subsidies that run out in 2027. The remaining third of the plant burns coal and will be forced to shut by 2025. Drax wants to convert this to a new gas-fired plant and to build a big battery next to it, but the plan is also dependent on securing subsidies. The talks with Scottish Power are focused on its gas-fired power plants, which generated pre-tax profits of £23.4 million last year, and hydro-electric plants, which accounted for about 14 per cent of output from its renewables division. This had earnings of £316 million, primarily generated by wind farms.
Times 24th Sept 2018 read more »