LONDON (dpa-AFX) - Drax Group plc. (DRX.L), an electricity generation company, reported Tuesday that its current trading is in-line with expectations. For fiscal 2019, the company reiterated its adjusted EBITDA guidance.
Following formal confirmation from the UK Government, Drax expects the Capacity Market to be re-instated shortly, with full retrospective payments made for the capacity provided. Capacity payments due to Drax for 2019 and since the suspension of the Capacity Market in 2018 are 75 million pounds. Drax expects these to be included in 2019 adjusted EBITDA, with cash settlement in January 2020.
Further, Drax, which is hosting a Capital Markets Day today, said it targets biomass self-supply capacity of five million tonnes by 2027. The company is evaluating options to deliver an additional three million tonnes of capacity.
Will Gardiner, Drax Group CEO said, 'Supplying more of our own biomass will cut costs and reduce supply chain risks, ensuring our biomass power generation remains viable in the long term. When combined with carbon capture it will also enable negative emissions, helping the UK on its path to net zero by 2050.'
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