Drax is back in the black as it emerged as a greener operator from 2021.
The energy giant sold off its gas-fired generation interests as it concentrated on biomass and hydro-electric operations, furthering its carbon capture plans to further clean up the North Yorkshire operations, while providing a huge anchor project for the wider Humber Net Zero ambition.
Total turnover dropped from £412 million to £398 million, with gas-fired generation discontinued after it was sold in a £186 million deal to Immingham-headquartered VPI.
Read more: Drax agees £18m capacity market deal for hydro power
Ongoing operations saw a 3.2 per cent uplift from £366 million to £378 million. Operating profit was £197 million, a huge turnaround from a £156 million loss in 2020.
Will Gardiner, chief executive, said "2021 was a transformational year for Drax as we became the world's leading sustainable biomass generation and supply company, whilst continuing to invest in delivering positive outcomes for the climate, nature and people.
"Over the past 10 years Drax has invested over £2 billion in renewable energy and has plans to invest a further £3 billion this decade, supporting the global transition to a low-carbon economy. Our investment has reduced our emissions from power generation by over 95 per cent and we are the UK's largest producer of renewable power by output.
“We are proud to be one of the lowest carbon intensity power generators in Europe - a significant transformation from being the largest coal power station in Western Europe.
"We have significantly advanced our plans for bioenergy with carbon capture and storage (BECCS) in the UK and globally. By 2030 we aim to deliver 12 million tonnes of negative emissions and lead the world in providing a critical technology which scientists agree is key to delivering the global transition to net zero."
Drax now has 2.6GW of biomass generation output, and has highlighted the East Coast Cluster’s selection as a government forerunner for CCS.
The £222 million acquisition of Canadian pellet firm Pinnacle Renewable Energy was another major event in the year.
Looking ahead the firm is trialling lowe cost sustainable biomass, with test runs successful as it looks to lay a key role in the Glasgow Declaration launched at COP26 to establish a world-wide industry standard on biomass sustainability. Drax, with the wider industry, faces constant challenges on the electricity generation method’s credentials, with base load for the grid seen as vital to reduce exposure to gas prices and renewables variations as new nuclear is built.
Philip Cox CBE, chair of Drax, added: “The group aims to realise its purpose and ambition through three strategic objectives - to be a global leader in sustainable biomass pellets, to be a global leader in negative emissions, and to be a leader in UK dispatchable, renewable power. These objectives are closely aligned with global energy policies, which increasingly recognise the unique role that biomass can play in the fight against climate change.
“Since 2012, we have reduced our carbon emissions from power generation by over 95 per cent, principally reflecting our long-term investment in sustainable biomass. More recently, in January 2021 we completed the sale of our CCGT gas assets, and in March 2021 ended commercial coal generation, further reducing our carbon emissions. Beyond this reduction, we have continued to progress our ambition to become a carbon negative company by developing opportunities for bioenergy with carbon capture and storage in the UK and internationally.
“With the right policy support in place in the UK and internationally, we believe this proven carbon removal technology could be used globally to deliver negative emissions. Through these activities, we expect to play a major role in delivering the UK's legally binding objective to achieve net zero carbon emissions by 2050 and support global efforts to reduce carbon emissions. We believe sustainable biomass has a long-term role to play in the UK and global energy markets, both as a dispatchable and sustainable source of renewable energy, and as a means of delivering negative carbon emissions.
“Our biomass supply chain strategy has continued to progress, with the acquisition of Pinnacle Renewable Energy in April 2021 positioning Drax as the world's leading sustainable biomass generation and supply business.”
