UK power generator Drax has raised its profit outlook for 2026 after demand for electricity increased during this summer’s heatwave, sending shares in the FTSE 250 group higher.
Drax said strong trading had continued into the second half of the year, with its generation assets playing a key role in meeting higher demand and balancing the electricity system during periods of extreme temperatures.
Chief executive Will Gardiner said the company’s recent performance had remained strong as its facilities “helped meet power demand through the summer heatwave, turning up and turning down as required to help balance the system”.
The National Energy System Operator issued four requests for additional electricity supply during the summer, with most linked to periods of soaring temperatures.
Drax told shareholders on Thursday that it had delivered a “strong performance” in July and August and now expected adjusted earnings for 2026 to be “around the top” of market forecasts.
The company also benefited from its acquisition of renewable infrastructure investor Bluefield Solar Income Fund (BSIF), which completed in August for £561 million.
The deal is part of Drax’s strategy to broaden its generation portfolio and expand the amount of energy infrastructure and system services it manages.
Gardiner said: “We are investing for the future in UK energy security, growing our megawatts under management and transitioning Drax into a broader business at the heart of the UK energy system, whilst keeping the lights on for millions of households across the country.
“The addition of BSIF brings significant benefits to the group and the integration is going well.
“Alongside the rest of our portfolio, BSIF gives us a fantastic opportunity to grow our asset base and system services further.”
The upgrade comes as Britain’s electricity system faces growing demands from higher temperatures, electrification and the expansion of renewable generation, increasing the importance of flexible power assets that can respond rapidly to changes in supply and demand.
Drax shares rose 0.8% to 826p in early trading on Thursday.
The company is continuing to position itself as a broader energy infrastructure group, with investment in generation capacity and system-balancing services forming a central part of its strategy.
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