Drax drops nearly 5% as government delays announcement on renewable subsidies

A delay in a key UK government announcement on renewable energy subsidies has sent shares in power group Drax sharply lower. An announcement was due today but this has now been put back until later. Reports suggested disagreements between the Liberal Democrats and chancellor George Osborne . Drax, which owns a coal fired power station, had been planning to increase green power production from biomass but was waiting for news on the subsidies before investing. Some in the City had anticipated that once the situation was clearer, Drax could become a takeover target for a larger energy group, such as Centrica. This latest delay has seen Drax drop 27.5p to 545.5p.