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Drax shares 2020 results, shelves gas power plans

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Drax Group has announced its 2020 results, reporting a 7% increase in pellet production and a further £2 million (€2.3 million) in adjusted EBITDA compared to 2019.

The company’s adjusted EBITDA from continuing and discontinued operations increased by £2 million (€2.3 million) to £412 million (€477 million), including the £60 million (€69 million) impact of COVID-19 on the business. Drax generated 11% of the UK’s renewable electricity.

Will Gardiner, Drax CEO, said: “Drax has supported its customers, communities, and employees throughout the COVID-19 pandemic and I want to thank colleagues across the group for their commitment and hard work over the last year.

“We have delivered strong results, a growing dividend for shareholders and excellent progress against our business strategy.

“Our focus is on renewable power. Our carbon intensity is one of the lowest of all European power generators. We aim to be carbon-negative by 2030 and are continuing to make progress.

“We are announcing today that we will not develop new gas-fired power at Drax. This builds on our decision to end commercial coal generation and the recent sale of our existing gas power stations.

“The proposed acquisition of Pinnacle Renewable Energy will position Drax as the world’s leading sustainable biomass generation and supply business, paving the way for us to develop bioenergy with carbon capture and storage – taking us even further in our decarbonisation.”

Drax’s pellet production increased by 7% in 2020 to 1.5 Mt, compared to 1.4 Mt in 2019. The cost of pellet production decreased by 5%.

The expansion of its Morehouse plant was completed in Q4 2020, and the expansion of the Amite and LaSalle plants was also completed, increasing the use of low-cost fibre and improving logistics.