- Generation unit earnings climb again
- Dividend up 10 per cent
Drax (DRX) is a political play for investors, as the government considers whether to keep handing the company hundreds of millions of pounds a year once the current subsidy deal ends in 2027.
The pressure is on. This week, a second BBC Panorama programme reported Drax has used wood from old growth forests in British Columbia, despite claims it solely sources pellets for its eponymous power plant from wood waste. Drax said its sourcing was in line with its policies, and Ofgem had signed off on its most recent audit in May 2023. Chief executive Will Gardiner said the company’s “best case” scenario would be a bridging deal with the government for 2027 onward “agreed and signed before the election”. Labour has been more sceptical on biomass as a renewable energy source.