Drax secures capacity agreements in £43m deal
Drax has secured agreements to provide 434 megawatts of capacity primarily from its pumped storage and hydro assets.
The UK power firm said on Wednesday the deal had a value of around £24m and covers the period October 2028 to September 2029.
It has also secured a provisional agreement to provide 24 megawatts of capacity for the refurbishment of Glenlee power station in the Galloway region of Scotland.
That deal covers the period October 2028 to September 2043 and has a value of around £20m.
There are also additional agreements for existing assets which extend to September 2028, Drax told shareholders in a statement on the London Stock Exchange.
Drax has increased investment into its hydropower assets in recent years, including £80m for the refurbishment of the Cruachan power station in Scotland last April.
Hydro plants are seen as critical to the UK’s decarbonisation push and the government in October confirmed the introduction of a cap and floor regime for new projects.
The announcement comes amid another twist in the scandal surrounding Drax’s alleged sourcing of wood from environmentally significant forests in Canada.
The company’s former public affairs lead, Rowaa Ahamar, last week accused it of “misleading the public, government and its regulator” over the allegations, which were first raised by BBC Panorama in 2022.
Ahmar, who says she was dismissed after raising concerns, has filed a claim against Drax and chief executive Will Gardiner at an employment tribunal for worse treatment at work and unfair dismissal.
Drax denies the allegations.