US subsidies may divert £2bn Drax investment away from UK - report

UK officials have reportedly raised fears that Drax may divert £2bn of planned investment in carbon capture to the US, lured by President Joe Biden’s massive package of green subsidies.

Bloomberg cited people familiar with the matter as saying that a delegation of US senators is scheduled to visit Drax power station in Selby, northern England, next week, where they will be shown the company’s plans for new bioenergy carbon capture and storage (BECCS) technology.

The 16 March visit has sparked concerns at the Department for Business and Trade that Drax will be lured by new incentives to invest in the US instead of the UK, sources told Bloomberg.

At stake is the £2bn Drax has said it would invest fitting carbon capture equipment to its UK plant as part of a plan that would ultimately support as many as 10,000 jobs. The company says the equipment will be able to capture 95% of the carbon dioxide emitted by its biomass-fired power plant and bury it under the North Sea.