EGGBOROUGH power station in North Yorkshire is at risk of closing, with the government due to announce on Thursday that it is not eligible for subsidies until 2015.
The coal-fired power station was looking to convert into a green energy project and burn wood pellets instead of coal, in order to avoid costly levies on carbon emissions.
While Eggborough would still be eligible to receive green subsidies in 2015 under the energy bill, the government indicated last week that it is unlikely to qualify for more immediate support.
Subsidies will be given more quickly to a certain number of projects from each technology type that are at risk of being cancelled.
An Eggborough spokesperson said that while there “is only really one outcome”, a final decision on which of the 16 bidding companies qualify will be unveiled on Thursday.
“Projects will be told this week what their provisional ranking is against all projects and within their technology group,” said a government spokesperson.