House of Commons · Written Ministerial Statement
Statement by the Secretary of State for Energy Security and Net Zero
10 February 2025 · Department for Energy Security and Net Zero
Proposed by Michael Shanks Lab Rutherglen
Summarised by AI from the official record, so it can contain mistakes.
At a glance
Key points
- The government has decided to support Drax Power Station through to 2031 with a new Low Carbon Dispatchable Contract for Difference from April 1, 2027.
- Subsidies for Drax will be reduced by half and strict sustainability measures will be implemented to ensure better value for consumers.
- Profit clawback mechanisms are included in the agreement to protect billpayers from excessive profits.
Issue summary
The statement addresses the government's decision on supporting Drax Power Station in Yorkshire through to 2031, including changes to sustainability criteria and subsidy levels.
Action requested
The minister announces new Heads of Terms for a Low Carbon Dispatchable Contract for Difference with Drax from April 1, 2027, reducing subsidies by half and ensuring better value for consumers. The agreement includes strict sustainability measures and profit clawback mechanisms to protect billpayers.
Key facts
- The previous government launched a consultation on supporting large-scale biomass generators ending in 2027.
- Drax Power Station provides around 5% of annual electricity generation as firm power.
- The new agreement halves the subsidies for Drax, saving nearly £6 per household annually.
- Sustainability criteria are increased to 100% sustainably sourced biomass and supply chain emissions reduced to 36.6 gCO2e/MJ.
- Profit clawback mechanisms are included with rates of 30% and 60% for excess profits.