New subsidies for Drax that ‘halve’ payments for burning wood for power New subsidies have been announced for wood-burning power plant Drax, which the Government said would halve costs for consumers and improve sustainability.
Drax Group chief executive Will Gardiner said the new framework was an “investment in UK energy security, which will result in a net saving for consumers” and support the delivery of the Government’s clean power by 2030 goal.
A Department for Energy Security and Net Zero spokesperson said: “This new deal will halve the amount of support for Drax, save money on people’s energy bills and contribute to energy security.
He said analysis indicated it would result in a £1.6 to £3.1 billion reduction in electricity system costs, versus the construction of new fossil fuel power plants – which the Government said would also carry significant risks.
Under the new contract for difference, Drax will be paid £113 per megawatt hour for electricity and it will be able to generate only 22-27% of the time, which Mr Shanks said would halve payments compared to the existing support regime, saving households nearly £6 a year on bills.
