LONDON (ShareCast) - Electricity stocks were the worst performers in London on Wednesday with Drax falling sharply after the government changed the terms of a key subsidy for conversion from coal to biomass.

The government said last December that it had shortlisted two of the company’s generating units at the Drax Power Station for state support, but said today that just one of the units is eligible.

In response, the company has initiated legal proceedings to challenge the decision.

Dorothy Thompson, the Chief Executive of Drax, said: "Whilst we are pleased to have been offered an investment contract for [one] unit conversion, we are disappointed by today's decision on the ineligibility of our second unit.

"Nothing has changed, as far as our plans are concerned, between being deemed eligible in December and now.”

The stock, which went ex-dividend today, was trading 12.2% lower at 655.94p in afternoon trade.

Others in the sector, including SSE, Infinis Energy, OPG Power Ventures, Good Energy and Greenko were also trading in the red today.


Top performing sectors so far today
Food Producers & Processors 7,719.79 +2.15%
Industrial Transportation 3,124.45 +0.75%
Pharmaceuticals & Biotechnology 12,444.68 +0.73%
Real Estate Investment Trusts 2,775.16 +0.53%
Insurance (non-life) 1,850.72 +0.38%

Bottom performing sectors so far today
Electricity 9,578.92 -2.82%
Technology Hardware & Equipment 1,143.55 -2.62%
Gas, Water & Multiutilities 5,832.03 -1.73%
Automobiles & Parts 9,141.84 -1.46%
Financial Services 7,896.27 -1.34%

BC

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