The British power generator confirmed it is scrapping the plans to build two combined-cycle gas turbines in place of two old coal-burning units next to an existing facility in Selby, North Yorkshire
Drax has abandoned its plans to build what would have been the biggest gas plant in Europe following protests from environmental campaigners.
The British power generator confirmed it is scrapping the plans to build two combined-cycle gas turbines in place of two old coal-burning units next to an existing facility in Selby, North Yorkshire.
The plans were given the go-ahead in October 2019, but this was seen as a controversial decision as the UK government, in approving the project, overruled its own planning authority’s recommendation to reject it on climate grounds.
Environmental law charity ClientEarth issued a High Court challenge in January 2020 on the decision to grant the 3.6-gigawatt (GW) plant – which it claimed would produce up to 75% of Britain’s power sector’s emissions.
But, following a judicial review, the government’s approval was ruled legal by the High Court in May 2020, and the UK Court of Appeals decided to reject the group’s latest legal challenge on 21 January.
On delivery the company’s full-year results for 2020 today (25 February), Drax’s CEO Will Gardiner said: “We are announcing today that we will not develop new gas-fired power at Drax. This builds on our decision to end commercial coal generation and the recent sale of our existing gas power stations.”
Drax reported £156 worth of losses in 2020 following decision to scrap plans for biggest gas plant in Europe
Drax’s decision to scrap the plans for the new gas plant is not all too surprising, after a company spokesperson said last month that the project was not certain to go ahead because it depends on the firm’s investment decisions and on securing a capacity market contract from the government.
The company previously affirmed it would only proceed with the new plant if it receives a favourable contract under a UK government subsidy auction that commissions power generators to ensure there is enough power throughout the winter months.
Drax had originally planned to enter an auction in March last year, with the hope of opening the plant in 2023, but it later announced it would not proceed while the legal process was ongoing.
Following the government’s deadline to phase out coal-fired power stations by 2025, the power generator is set to end its commercial sales of the fossil fuel from next month as part of a shift towards cleaner fuel sources, notably biomass.
According to Drax’s annual financial statements, the decision to abandon the plans for the new gas plant will cost the company up to £13m ($18m).
The firm reported a £156m ($221m) operating loss for 2020, after recording £239m ($339m) worth of obsolescence charges after deciding not to develop the gas plant and for writing off the value of its remaining coal inventories, as well as £34m ($48m) of costs associated with closing its coal facilities.