Drax looks to expand in the US as it takes advantage of Inflation Reduction Act
British power generator Drax is looking to expand its operations in North America as it seeks to take full advantage of the benefits on offer under the US’s Inflation Reduction Act.
The FTSE 250 firm said today it has selected two initial sites in the south of the US for new bioenergy projects with carbon capture and storage (BECCS), each costing roughly $2bn, and that it is continuing to evaluate a further nine sites in North America.
It said its commercial model for developing these US projects includes “a direct pay tax incentive under the Inflation Reduction Act”.
The act offers hundreds of billions of dollars in green subsidies and has sparked a huge interest from companies around the world.
Drax said it has now hired 80 employees across the US and Canada to support its current and future projects there.
It said it believes that the role of BECCS projects “will grow significantly as governments and companies take action to address their own carbon footprints”.
“The world’s leading climate scientists at the UN’s IPCC are clear – the planet cannot solve the climate crisis without the combination of reliable, renewable electricity and carbon removal technologies,” Will Gardiner, Drax Group CEO, said.
“Drax is a growing and sustainable, international business providing flexible, renewable energy and carbon removals solutions, via BECCS, which put us at the heart of global efforts to deliver net zero and energy security,” Gardiner added.
Its share price was up 2.7 per cent to 639p at the time of reporting.
The news comes after the firm was forced to pause its £2bn BECCS project after UK government support for the project was thrown into doubt.