Drax Group PLC Bridging Mechanism Consultation (1843A)
18 Janeiro 2024 - 8:54AM
UK Regulatory
TIDMDRX
RNS Number : 1843A
Drax Group PLC
18 January 2024
18 January 2024
Drax Group plc
("Drax", "the Group", "Drax Group", "the Company"; Symbol:
DRX)
Bridging Mechanism Consultation
Drax welcomes the UK Government's announcement of the launch of
a consultation on a transitional support mechanism for large-scale
biomass generators, including Drax Power Station, as they
transition from the end of their current renewable schemes in 2027
to bioenergy with carbon capture and storage (BECCS).
The consultation, which closes on 29 February 2024, recognises
the important role which biomass can play in delivering the UK's
plans for net zero as well as energy security, and sets out four
models for consideration, including two variations of a CfD
model.
Drax Group CEO, Will Gardiner said: "The Government's
announcement is a welcome step forward in facilitating the
deployment of large-scale BECCS and the development of CCUS
Clusters in the UK.
"BECCS is currently the only credible large-scale technology
that can generate renewable power and deliver carbon removals. The
consultation is necessary to develop an appropriate mechanism that
will ensure biomass power stations, like Drax Power Station,
continue to play an important role in the UK's energy security
while transitioning to BECCS and helping the UK to meet greenhouse
gas reduction targets. We will be responding to the consultation in
due course."
In December 2023, the UK Government reiterated its ambition to
deploy at least 5 MtCO(2) /year of engineered greenhouse gas
removals by 2030, potentially scaling to 23 MtCO(2) /year by 2035
and up to 81 MtCO(2) /year by 2050, and published its latest
position on the design of a Power BECCS business model, which
includes a 15-year CfD with a dual payment mechanism linked to both
low-carbon electricity and negative emissions.
Drax believes that delivery of this ambition will require the
development of at least one BECCS unit at Drax Power Station by
2030. Subject to the right investment framework, Drax plans to
install carbon capture technology on two of the existing four
biomass units. Each unit would be capable of capturing c.4Mt of
CO(2) per year.
A link to the consultation is copied below.
Transitional support mechanism for large-scale biomass
electricity generators - GOV.UK (www.gov.uk)
Analysis by the consultancy Baringa (commissioned by Drax) shows
that BECCS at Drax Power Station could save the UK up to GBP15bn
between 2030 and 2050 and would help ensure that the station
continues to provide important security of supply benefits. A link
to the report can be found here .
Other developments
Separately, on Tuesday 16 January 2024, the UK Government
approved the Development Consent Order (DCO) for plans to convert
two biomass units at Drax Power Station to BECCS.
The DCO is another milestone for the project, providing planning
consent for its development.
Enquiries:
Drax Investor Relations: Mark Strafford
mark.strafford@drax.com
+44 (0) 7730 763 949
Media:
Drax External Communications: Chris Mostyn / Andy Low
chris.mostyn@drax.com
+44 (0) 7548 838 896
andrew.low@drax.com
+44 (0) 7841 068 415
Website: www.Drax.com
END
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