FCA closes investigation into Drax over biomass sourcing
Summary
The Financial Conduct Authority (FCA) has closed a nearly 10-month investigation into Drax, a UK power company, over how it reports the source of wood pellets used for biomass energy. The FCA found no evidence that Drax made misleading statements or left out important information for investors.Key Facts
- The FCA reviewed thousands of pages of documents during its investigation.
- The investigation focused on Drax’s annual reports from 2021 to 2023.
- Drax operates the largest biomass power station in the UK, burning imported wood pellets to create electricity.
- Critics have questioned whether the wood pellets are sustainably sourced and if they increase carbon emissions.
- In 2024, Drax paid £25 million after a separate energy watchdog found issues with its data reporting but no deliberate wrongdoing.
- The FCA confirmed Drax did not make false claims or wrongly receive renewable energy subsidies.
- Drax’s stock price rose by 1.2% following the FCA’s announcement.
- Drax’s CEO said the company cooperated fully with the investigation and welcomed the closure with no action taken.
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