Electricity demand has hit a new low, according to Drax

POWER station operator Drax said yesterday that the downturn had triggered an &ldquo;unprecedented&rdquo; slump in demand for electricity, as the group reported a dramatic slump in its first half earnings.<br /><br />Chief executive Dorothy Thompson said the fall off in power requirements had been much sharper than contraction in the broader economy.<br /><br />&ldquo;For our sector it&rsquo;s a very unusual movement... in fact unprecedented in my experience,&rdquo; she said.<br /><br />The news came as Drax posted a sharp fall in first-half earnings on the back of lower power prices. But it said profit should rise sharply in 2010 thanks to more favourable hedging contracts.<br /><br />The company said it had already sold approximately 80 per cent of its output for 2010 at higher average spreads than for 2009.<br /><br />Pre-tax profit at the company fell to &pound;33.8m for the first six months, down from &pound;149.5m year-on-year. <br /><br />Revenues came in 12 per cent lower at &pound;706.9m.<br /><br />The group said its full-year expectations for core profits, which fell 27 per cent to &pound;150m in the first half, were unchanged.<br /><br />Thompson added that electricity demand was currently running at about six per cent lower than a year ago with households, where consumption is down about two per cent, proving more robust than industrial and commercial customers.<br /><br />Earlier this month, Drax refinanced &pound;235m of its debt, and extended the maturity of the borrowings to December 2012 from December 2010.