Profits at Drax Group, the power generator, fell 45 per cent in the first half as an increase in the cost of coal and carbon emissions permits outweighed the positive effect of higher electricity prices.

The company, which owns the Drax coal-fired power station in North Yorkshire, sold 13 terawatt hours of power in the first half of the year, a rise of 1 terawatt hour, at an average price of £53.60 per megawatt hour, 11 per cent higher than the same period of 2007. This lifted Drax’s revenues 25 per cent to £802m.