(Bloomberg) -- Drax Group Plc, operator of the UK’s largest power station, aims to invest $12.5 billion building new biomass power plants in the US over the next decade, taking advantage of generous subsidies.
The first plant will need between $2 billion to $3.5 billion in investment and could be ready by 2030, Chief Executive Officer Will Gardiner said in an interview. Twenty further sites are being evaluated for future projects to be built under Drax’s newly launched US-based subsidiary Elimini, according to a press statement.
The power plants will burn wood to generate electricity and capture the emissions produced. However, biomass as a fuel source has its limitations, Gardiner said, as it relies on strict use of sustainably regrown forests.
Subsidies have been the major draw for the UK power company’s US ambitions with billions of dollars for clean energy available through President Joe Biden’s Inflation Reduction Act.
Gardiner said Drax was not backing away from the UK, but a securing more government subsidies by the end of 2024 was crucial to start a carbon capture project at its main plant.
“Frankly we need to get moving,” Gardiner said, adding that the decision had been delayed under the previous government.
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