Overview
- Ember estimates Drax will receive about £458.6 million per year from 2027 to 2031 under the extended support package.
- Last year’s subsidy was reported at £869 million for roughly 5% of UK electricity, indicating lower annual support under the new terms.
- The contract lifts the guaranteed price to £157.50/MWh, well above current forward wholesale prices of just over £78/MWh.
- Drax says the arrangement strengthens energy security and, citing Baringa analysis, could deliver up to £3.1 billion in consumer savings over four years.
- The deal requires 100% sustainably sourced woody biomass with substantial penalties for breaches, as emissions accounting remains contested by Ember and rejected by Drax as flawed, and the FCA’s inquiry into historical pellet-sourcing disclosures continues.