The £500 million supply deal includes the option of two 5-year extensions which could increase the total value of the deal to £1.5 billion.
Thames Water already sources about 20 per cent of its electricity through self-generated renewables such as solar, wind, hydro and biogas, but the Drax deal will now enable the water company to meet all of its electricity needs from renewables.
Thames Water’s energy manager Angus Berry said the deal will drive the company’s strategy of reducing consumer costs while minimising its environmental impact.
“This deal with Haven puts downward pressure on bills and means we will now be using 100 per cent renewable electricity. We look forward to growing our relationship with Haven to exploit further opportunities to minimise energy costs and emissions, as well as continuing to work towards our ambitious target of self-generating 30 per cent of our own electricity by 2020,” he said.
Drax generates around 7-8 per cent of the UK’s electricity and is playing an increasing role in the decarbonisation of the electricity mix as it converts its coal-fired units to burn biomass.
Two out of six units have now been converted and plans are advanced to modify a third unit to high-biomass later this year.