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11 April 2006 - The electricity provider Centrica has signed an agreement with the owners of the UK's largest coal fired power plant, Drax, that will see it given access to 600 MW of coal fired generation capacity.
The deal, which will run from October 2007 until the end of the EU Emissions Trading Scheme phase 2 in December 2012, will be capable of meeting around 8 per cent of Centrica's forecast peak residential electricity demand.
A statement from Centrica read: "The agreement, which will provide Centrica with access to 600 MW of power, brings increased fuel diversity to Centrica's electricity supply mix, enabling it to further stabilise the cost of sourcing electricity to its British Gas customers."
The announcement of the contract comes as Drax Power Limited published a paper it is to submit to the British government's Energy Review panel.
The paper argues that coal fired generation is "unique in offering security and flexibility of electricity supply at a competitive price and must remain a vital element of the UK's energy mix."
Published by Drax Power, with contributions from the Confederation of UK Coal Producers and Mitsui Babcock, the paper calls on the government to provide a stable and long-term policy framework that gives the coal fired industry the confidence to invest in technology to further improve environmental performance.
In its summary the paper reads: "The challenge for coal fired generation is environmental, and as we move towards a low carbon economy the focus must be on reducing carbon dioxide emissions."
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