Drax, the electricity generator, said power prices would remain depressed for some time because of the recession, which has reduced demand for energy, affecting the group’s future profits.

The company, which owns the Drax coal-fired power station in North Yorkshire, reported 2008 full-year revenue up 41 per cent from £1.25bn to £1.75bn because of higher output and higher power prices. But pre-tax profits fell 1 per cent from £448.5m to £443m as a rise in Drax’s average cost of coal and carbon permits squeezed profit margins.