Drax Share Discussion Threads

[mobtheplod] 25/9/2015 09:36

I guess what goes around comes around, nice to see Dot is looking after the shareholders. The Government can't surely expect DRX to carry all the weight after pulling the rug.

[cabreado] 25/9/2015 00:44

Drax pulls out of Government's £1bn green energy projectDrax blames cuts in support for renewable energy for its decision not to build a carbon capture and storage facility next to its North Yorkshire power stationDrax had invested £3m into developing its carbon capture project

[beeks of arabia] 24/9/2015 17:30

The industry is on its knees at the moment.

Drax have a little shelter from being vertically integrated (to some extent).

All that seems to be happening is the big players are taking a loss on generation and making it back at the consumer end. It's all a big con.

Eggborough has been a victim of this.

How the other Coal assets are still going is anyones guess. I would expect some announcements soon with closure plans for other fossil generators.

Not a great place to be - fossil generators and service companies are obvious short candidates, even with some big drops already (DRX, HSP, CIU).

[fangorn2] 24/9/2015 17:23

I'm sure there'll be a dodgy RNS to advise us of the latest catastrophe in the not too distant future.

[1corrado] 24/9/2015 14:47

I have 12005 share at an average of 265.20 a bit worry but I am also getting dividend of £615.00 to be paid on the 10-10 that help but not much............

[nick rubens] 24/9/2015 14:43

1corrado Drax has continually been making less and less profit and cutting the dividend over the last decade or so. The finance director quit a couple of months ago. The govt changed it's mind on subsidising it's biomass effort.

It has no meaningful profitable future IMO as it stands at the moment and I can't see what can change any of that.


Gas and electricity prices would have to rise dramatically for Drax to recover. It's almost a risky oil and gas company share play.

[1corrado] 24/9/2015 12:37

The drop on the share price is far to much what is going on??????????????

[zcaprd7] 24/9/2015 12:30

A long cold winter with lights going out will focus the minds of the politicians...

[watson] 24/9/2015 10:05

Drax is a classic case of the unreliability of Government policy when it comes to business investment.

The last Govt encouraged burning of biomass, so Drax invested heavily in bringing shiploads of North American woood chips across the Atlantic to burn instead of the coal that lies on their doorstep. Sounds like nonsense and it probably is.

New Govt - new policy - problems for Drax.

Rgds,

Watson

[1corrado] 24/9/2015 09:47

WHAT IS HAPPENING WITH dRAX?????????????

[zcaprd7] 18/9/2015 20:16

Quite a bit of volume today?

[zcaprd7] 16/9/2015 01:38

Nice chilly and long winter predicted this year, because of El neno. Obviously the met have to have a reason for a cold winter...

[jamesiebabie] 11/9/2015 23:50

Fangorn - we now have reverse auctions via the capacity market; prices are trending lower. The ccgt's are gaining traction after a few years of being on their knees, but even they are only just making money.

I believe the industry are having some large impairments and I would not be surprised to see DRX have right downs against the recent capex for the conversions if the JR fails.

[via con] 11/9/2015 21:34

Fangorn2

it is just another GS note - such as oil 200usd and 2000usd for gold which they also predicted. As for power in the UK , I agree, but there is a read through for other investment opportunities. Nevertheless today´s fall seems to have been on the back of this illustrious note.

BTW I´m long. Contrarian or idiot, we´ll see.

GLTA

[fangorn2] 11/9/2015 13:04

"We expect no recovery in UK power prices and reduce our UK power
forecasts by c.10%. We expect demand to continue to fall"

Quite at odds with chatter about power shortages/black outs due to little spare capacity.

"and believe that even significant plant closures are likely to have little impact on the power price owing to the flat merit order."

Can we afford to have any plants shutdown as we head into winter??

[via con] 11/9/2015 12:30

GS note this morning


We expect no recovery in UK power prices and reduce our UK power
forecasts by c.10%. We expect demand to continue to fall (peak demand in
2014 was 12% below the all-time peak in 2006), and believe that even
significant plant closures are likely to have little impact on the power price
owing to the flat merit order. The only value for most existing gas and coal
plant is from capacity payments which we expect to remain at a low level.

Drax, as a 100% UK power generator, is the most exposed to our new
lower outlook for power prices. We cut our 12m price target to 230p (from
300p) and downgrade to Sell. Drax has underperformed the utilities sector
by 35% YTD, reflecting falling power prices and unfavourable regulatory
changes. We highlight a further potential negative catalyst: the EU decision
on regulation for Drax’s final biomass unit. We see the risk/reward skewed
to the downside: we believe the share price is discounting a best case
scenario on this decision (fixed price CfD approved at £105/MWh) while we
see more than 60% valuation downside if the CfD is rejected by the EU.

[beeks of arabia] 05/9/2015 09:58

Could end up being survival of the fittest.

The more coal that shuts/mothballs, the more likely the real chance of price spikes in the next few years.

You watch the share price react when a couple of nukes go off the grid and we have a cold winter.

[ball deap] 05/9/2015 09:40

Beeks, don't you mean bye bye drax, this has been on a downward trend for months and that isn't going to change.

[beeks of arabia] 02/9/2015 21:41

Eggborough on its way today.

Bye bye coal.

[audigger] 20/8/2015 08:59

Meanwhile we're heading back to 276....will be interesting to see if the previous support level holds or if we go lower this time. Keeping my powder dry for now, but will be back in soon for what I hope is another bounce above 300.

[fangorn2] 14/8/2015 14:51

"Another clear negative over the month was Drax, which was a major casualty of the UK Budget, in which the Climate Change Levy exemption for renewable energy was abolished. This decision is very frustrating, as significant capital has been committed by Drax to convert part of its power station from coal to biomass, following a long-term commitment from Government to allow an appropriately attractive long-term return. The Government is now going back on that commitment with negative implications for Drax. Despite this, we added modestly to the holding at a very depressed share price level and continue to view it as a strategically important asset in the UK electricity generation sector."

[audigger] 07/8/2015 20:58

Got out today at 319 after getting in at 276. Suspect I've bailed too soon but a profit is a profit. I'm away next week in the land of no internet so I couldn't handle the uncertainty as this could pull back a bit before another move towards 400. I tried the same recovery play with Lonmin and have been badly burned! Some you win and some you just get completely wrong!