Source · Select Committees · Public Accounts Committee
Recommendation 19
19
New Drax agreement aims for reduced operational role and significant subsidy savings.
Conclusion
DESNZ is clear that the agreement is intended to improve on current arrangements. Firstly, Drax will play a smaller role in the power system than it currently does. This means that Drax will receive support for a maximum of 27% of the time in each year, less than half of the time it currently does (which DESNZ estimates will save each household around £6 a year). This reduction also accords with CCC advice that unabated biomass should not be supported at high load factors after 2027. Secondly, DESNZ expects the agreement to reduce the amount of subsidy that Drax receives each year by £170 million compared to the alternative of procuring gas and includes a claw–back provision for profits over a certain level.55