ENERGY giant Drax has reported a 'robust' trading and operational performance during the first three months of 2021.

Highlights of the first quarter include the completion of the acquisition of Pinnacle Renewable Energy Inc, making the business a world leader in biomass generation and more than doubling its sustainable biomass production capacity.

In a trading update, the firm said it had secured capacity market agreements worth around £10 million in March, 2021, for the delivery period October 2024 to September 2025.

Drax also secured 15-year agreements for three new Open Cycle Gas Turbine projects in England and Wales.

The company says it has a strong balance sheet and cash flows, and has pledged to continue its focus on clean energy generation and a reduction in carbon emissions.

Commercial coal generation ended in March 2021, with full closure planned for September 2022.

Will Gardiner, Drax Group chief executive officer, said: “In the first quarter of 2021 we delivered a robust trading and operational performance, alongside steps to further decarbonise the business and support our flexible and renewable generation strategy.

"These include the end of commercial coal generation, the sale of our gas power stations and just last week we acquired leading Canadian biomass producer Pinnacle Renewable Energy Inc.

“The acquisition of Pinnacle positions Drax as the world’s leading sustainable biomass generation and supply business.

"This advances our strategy to increase self-supply, reduce our own cost of biomass production and create a long-term future for sustainable bioenergy, which will pave the way for the development of negative emissions from Bioenergy with Carbon Capture and Storage (BECCS).

"BECCS at Drax would make a significant contribution to the UK reaching its new target to cut carbon emissions by 78 per cent by 2035.”

During the summer Drax will undertake planned maintenance on its CfD(2) biomass unit, including a high-pressure turbine upgrade to reduce maintenance costs and improve thermal efficiency, contributing to lower generation costs.

Pellet Production has performed well with good production and cost reduction plans on track.

On April 13, 2021, Drax completed its acquisition of Pinnacle, advancing the Group’s biomass strategy by more than doubling its sustainable biomass production capacity, significantly reducing its cost of production and adding a major biomass supply business, underpinned by long-term third-party supply contracts.

The Group’s enlarged supply chain will have access to 4.9 million tonnes of operational capacity from 2022. Of this, 2.9 million tonnes are available for Drax’s self-supply requirements in 2022 (increasing to 3.4 million tonnes in 2027).

At March 31, 2021, Drax had cash and total committed facilities of £801 million.