+------------------------------------------------------------------------------+
Drax First-Half CO2 Emissions Rose as Power Output Increased
2010-08-03 09:55:17.107 GMT
By Catherine Airlie
Aug. 3 (Bloomberg) -- Drax Group Plc, owner of western
Europe's largest coal-fired power station, said its carbon-
dioxide emissions rose in the first half after it produced more
electricity during a colder-than-usual winter.
The 4,000-megawatt plant in Yorkshire, northern England,
required emissions permits to cover 10.8 million metric tons of
CO2 in the six months through June. That compares with 9.9
million tons a year earlier and includes allowances allocated
for free, the company said today in a statement.
Drax is covered under the European Union's emissions
trading program, the world's biggest. It has an annual cap of
9.5 million tons of CO2 in the years through 2012 and must buy
permits to cover any excess. Drax will have to purchase
allowances to cover all of its emissions from 2013, the third
phase of the EU program. It emitted nearly 20 million tons of
CO2 last year, according to EU data compiled by Bloomberg.
Drax said it paid an average of 12 pounds ($19.10) a ton
for its emissions permits for the first half of this year,
compared with 16.60 pounds last year. This reflected a trading
strategy of buying permits when it sells power in advance, to
protect against falls in electricity prices, Drax said in the
statement.
EU emissions permits for delivery in December have risen 15
percent to 14.47 euros ($19.14) this year on speculation an
improved economy will boost power station and factory output as
fewer CO2 permits are allocated for free. Uncertainty of when
and how frequently permits for use after 2013 will be sold has
also boosted prices.
Installations in Britain under the EU cap-and-trade program
can cover up to 8 percent of their emissions using United
Nations offsets, or Certified Emission Reduction credits, and
can roll any unused quota forward up to 2012. Drax buys coal and
emissions permits at the same time, Dorothy Thompson, chief
executive officer said on a conference call today, declining to
comment on trading activity after 2012. Drax didn't use any CERs
in 2008 or 2009, EU data show. We "intend to use CER secondary
permit allowance," Thompson said, declining to say when or how.
For Related News and Information:
Top Power Stories: PTOP <GO>
U.K. Power Prices: ELEU <GO>
U.K. Power Generation: UKPG <GO>
--Editors: Rob Verdonck, Raj Rajendran
To contact the reporter on this story:
Catherine Airlie at +44-20-7073-3308 or
cairlie@bloomberg.net
To contact the editor responsible for this story:
Stephen Voss at +44 207 7073 3520 or sev@bloomberg.net
