Drax PLC (LON:DRX) has announced it is no longer intending to develop new gas fired power at its plant in North Yorkshire.
The original plans involved the conversion of two coal-fired units into gas generators, making it Europe’s biggest gas-fired power station, but were met with huge criticism because of the environmental impact.
READ: Drax may ditch UK gas-fired power station in environmental effort
According to pressure group ClientEarth, the 3.6-gigawatt project could create 400% more greenhouse gas emissions than if it were not built.
In January, Drax completed the sale of existing gas generation and it is set to exit commercial coal operations in March.
The changes cost £239mln in one-off charges as well as £34mln associated with pensions and redundancies, although the coal closure will result in £30-35mln of annual savings.
Gas phase out will obviously take a lot longer and there will likely be more room for CCS abated gas than there was for coal, but it is remarkable how quickly the idea of a 'bridge fuel' is already being challenged.
— James Murray (@James_BG) February 25, 2021
Earlier this month, the firm announced the proposed acquisition of Pinnacle Renewable Energy to become “the world's leading biomass generation and supply business” and supporting the goal of becoming carbon negative by 2030.
In the year to December 31, revenue dipped 5% to £4.2bn, while adjusted underlying earnings (EBITDA) were flat at £412mln.
Loss before tax swelled 15-fold to £234mln because of one-off charges related to discontinued operations, though net debt was cut to £776mln from £841mln in 2019.
The dividend was raised to 17.1p per share from 15.9p the year before.
Shares dipped 1% to 391p on Thursday morning.