Last checked at 26 Sep 2023 07:25
26 September 2023
Drax Group plc
("Drax", "the Group", "Drax Group", "the Company"; Symbol: DRX)
Track-1 expansion process update
The Department for Energy Security & Net Zero ("DESNZ") has, as part of a market update to the sector held yesterday, set out an indicative position that large-scale Power BECCS (Bioenergy with Carbon Capture and Storage) projects be eligible to participate in an expansion of the Track-1 carbon cluster sequencing process.
As part of the update, DESNZ set out its draft expectation to run the Track-1 expansion and Track-2 processes in parallel, subject to T&S capacity and ministerial sign off. Following the designation of the Viking CCS cluster as a Track-2 cluster in July 2023, there are now two potential routes which could support the Drax Power Station BECCS project and wider CCS in the Humber region by 2030 - the East Coast Cluster and Viking CCS cluster.
DESNZ also set out an indicative timeline that shortlisted projects would commence negotiations from Autumn 2024. DESNZ will now receive feedback on its draft proposals pending further updates and the publication of final guidance in due course.
Will Gardiner, Drax CEO, said: "The Government's statements are a helpful step forward not just for BECCS in the UK, but for the wider fight against climate change. We can only reach net zero by investing in critical, new green technologies such as BECCS. I welcome the Government's draft position and urge them to progress with both Track-1 expansion and Track-2 processes in parallel this winter".
Separately, in August 2023 the UK Government published a Biomass Strategy which set out its position on the use of biomass in the UK's plans for delivering net zero. The Biomass Strategy outlined the potential "extraordinary" role which biomass can play across the economy in power, heating and transport, including a priority role for BECCS, which is seen as critical for meeting net zero plans due to its ability to provide large-scale carbon dioxide removals. This is in addition to formal bilateral discussions between Drax and the Government in relation to a potential bridging mechanism between the end of the current renewable schemes in 2027 and the commissioning of BECCS at Drax Power Station.
Enquiries:
Drax Investor Relations: Mark Strafford
+44 (0) 7730 763 949
Media:
Drax External Communications: Aidan Kerr
+44 (0) 0784 909 0368
Website: www.Drax.com
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