Drax "Backing Out of Coal" As It Announces £11 Million Loss
1:50pm 29th July 2014
Drax power station says it's "backing out of coal" as it announces an £11 million loss for the six months between January and June.
Half the plant is currently being converted to from coal to wood burning for electricity, with a multi-million pound bill for Drax. The plant says that the costs have been factored in and a small loss half way through a major project like this is not something to be concerned about.
Twenty percent of Drax output now comes from this new biomass technology, with a target of fifty percent by 2016.
The company says it's been hit hard by the environmental carbon tax, which is making it too expensive for Drax to continue to burn coal for energy. Costs for the carbon tax have increased dramatically in recent months.
Drax's confirmation that it is "backing out of coal" will not be welcome news for miners at nearby Kellingley Colliery who are fighting to keep their pit open.
A "managed closure" of the pit, which employs more than 700 people, is currently taking place over eighteen months.
Drax is one of the main buyers of coal from Kellingley, but Peter Emery from Drax says the pressure Drax is under to supply energy at competitive prices means it cannot afford to pay a premium to Kellingley and has to get coal from the cheapest source.
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