The firm’s CEO said Drax has been ‘working hard to help keep the lights on for millions of UK households and businesses through a period of acute geopolitical uncertainty’
Drax Power Station in North Yorkshire(Image: Getty)
Power giant Drax has issued an upbeat trading update highlighting how it is “supporting UK energy security at a critical time” during the Middle East conflict. The FTSE 250 firm operates the country’s largest power station in Selby, North Yorkshire, which produces at least 5% of the UK’s electricity, mainly from sustainable biomass.
It said a good performance across the group means its 2026 full year adjusted Ebitda is expected to be in line with estimates of £665m – subject to continued good operational performance. Drax produces over 5% of the UK’s electricity and around 10% of its renewable power, going up to 18% at times of peak demand and on certain days over 50%.
And amid the conflict in the Middle East, it said it is helping to support the UK power system, stating: “The group’s focus on flexible, dispatchable generation and renewables enables it to support a secure, lower cost UK power system, which can continue to decarbonise, by allowing more intermittent renewables to operate and helping to reduce the UK’s exposure to higher gas prices and reliance on imported power.
“The group’s supply chain has a high level of operational redundancy, with limited exposure to underlying commodity prices, sourcing biomass primarily from North America, including from the group’s own facilities in the US South. To help maximise output at times of high demand, the group is continuing to optimise generation across its portfolio to deliver power when it is needed most.”
Meanwhile Drax bosses said its Pellet Production business is performing well, with a continued focus on cost reduction in its US operations, supporting UK energy security via biomass generation at Drax Power Station. It said a strategic review of the Group’s Canadian operations is ongoing.
Drax said its Pellet Production business is performing well.(Image: Drax)
It added: “Against the backdrop of growing demand for energy security Drax continues to see long-term potential for new and existing markets for bioenergy, which can offer an alternative to fossil fuels, including in the production of sustainable aviation fuels and other industrial processes.”
Drax Group CEO, Will Gardiner, said: “We have started the year well and have delivered a good operational performance across the Group, supporting UK energy security at a critical time for the country. Our assets, colleagues and supply chain partners have been working hard to help keep the lights on for millions of UK households and businesses through a period of acute geopolitical uncertainty.
“We are at a key moment of transition in our business and in the UK’s energy system. With our first battery storage projects and the commissioning of our first OCGT unit progressing, we are growing our UK FlexGen portfolio.
“We are excited about the potential opportunities to invest further to help the country meet its growing energy needs. We believe these opportunities could create value for stakeholders and offer attractive returns for shareholders, in line with our capital allocation policy.”
In February Drax confirmed a major restructuring which will lead to 350 redundancies as part of plans to build “a strong, resilient business for the future”. The firm said it is “focused on driving growth in our flexible generation business”, resulting in the restructure. A consultation process is being carried out with affected staff in Yorkshire and North America.
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