Scottish Power switches to 100% wind power with £702m asset sale
Scottish Power has become the first UK energy company to switch completely to wind power after selling its last remaining gas plant to Drax Group.
Drax announced a deal on Tuesday to acquire a portfolio of Scottish Power’s assets for £702 million.
The sale means Scottish Power will now generate 100% of electricity with clean wind power.
“This is a pivotal shift for Scottish Power as we realise a long-term ambition,” said chief executive Keith Anderson.
“We are leaving carbon generation behind for a renewable future powered by cheaper green energy. We have closed coal, sold gas and built enough wind to power 1.2 million homes.”
Scottish Power reiterated its commitment to invest £5.2 billion over the next four years in renewables, advanced grid networks and smart technology.
The acquired portfolio includes pumped storage, hydro and gas-fired generation assets.
Confirmation of the deal comes as Drax seeks to diversify beyond coal ahead of the 2025 national deadline to phase out the most carbon-intensive form of power generation.
Drax chief executive Will Gardiner said: “I am excited by the opportunity to acquire this unique and complementary portfolio of flexible, low-carbon and renewable generation assets.
“It’s a critical time in the UK power sector. As the system transitions towards renewable technologies, the demand for flexible, secure energy sources is set to grow.
“We believe there is a compelling logic in our move to add further flexible sources of power to our offering, accelerating our strategic vision to deliver a lower-carbon, lower-cost energy future for the UK.”
The new assets are expected, based on recent power and commodity prices, to generate earnings of between £90 million and £110 million in 2019.
The acquisition is expected to be completed on December 31 2018, pending the approval of Drax’s shareholders and competition authorities.