LONDON, Feb 10 (Reuters) - Britain said it had agreed a new deal with Drax which would halve subsidies for the domestic power producer over the 2027-2031 period, saving consumers money while also ensuring the group uses more sustainable sources of woody biomass.
The government said on Monday that under the new agreement Drax would play a much more limited role in the system, providing low carbon dispatchable power only when it is "really" needed.
The company will need to switch to using 100% woody biomass from sustainable sources, up from the previous level of 70%, the statement said, adding that it believed the new deal would save consumers 170 million pounds in subsidy each year of the agreement compared with the alternative of procuring gas.
Drax, Britain's largest renewable power generator by output, has converted four coal-power units to use biomass and operates hydro power projects. It has been waiting for details on new government support as the current subsidies run out in 2027.
"This government will do whatever it takes to deliver energy security and protect billpayers now and into the future," the statement said.
Britain is aiming to decarbonise its power sector by 2030. Meeting this target will require a large increase in renewable energy, such as wind and solar, as well as projects that store energy for when there is insufficient wind or sun.
Reporting by Sarah Young; editing by Kate Holton
Source: Reuters