Electricity provider Haven Power, a unit of Drax Group, has signed a £500m (US$769 million) deal to supply Thames Water with clean energy from biomass for a five-year period.
There is an option for two further five-year renewals which could increase the overall value of the contract to more than £1.5bn over 15 years. Haven Power is the UK’s largest independent electricity supplier to businesses and sources its power from the Drax power plant in Selby, Yorkshire, which, as a result of its biomass transformation, is now the UK’s single largest supplier of renewable energy.
The deal will enable Thames Water, which already sources about 20% of its electricity through self-generated renewables such as solar, wind, hydro and biogas, to meet all of its electricity needs from renewables.
“As the UK looks to decarbonise in an affordable and pragmatic way, it is pioneering companies like Thames that are leading the way,” said Drax Group CEO Dorothy Thompson.
Drax is undergoing a major transformation programme to convert its 4 gigawatt power station – which supplies around 8% of the UK’s power – from coal to sustainable biomass. Two out of six units have now been converted and plans are advanced to modify a third unit to high-biomass later this year. The estimated 12 million tonnes of carbon saved once three units are fully converted is equivalent to taking 10% of the UK’s total vehicle fleet off the roads and makes Drax the single largest decarbonisation project currently underway in Europe.
“This deal with Haven puts downward pressure on bills and means we will now be using 100% renewable electricity,” said Thames Water energy manager Angus Berry. “We look forward to growing our relationship with Haven to exploit further opportunities to minimise energy costs and emissions, as well as continuing to work towards our ambitious target of self-generating 30% of our own electricity by 2020.”