Trading Statement

Drax Group PLC
29 June 2007



29 June 2007

Drax Group plc

Trading Update


Prior to entering its close period on 7 July 2007, Drax Group plc ('Drax')
announces the following trading update.

Contracted Position for 2007, 2008 and 2009

Since issuing the 2006 Preliminary Results announcement on 8 March 2007, Drax
has continued to trade in line with its expectations and to follow the stated
trading strategy of making steady forward power sales with corresponding carbon
and coal purchases. Drax's aim is to deliver market level or better dark green
spreads across all traded market periods and, as part of this strategy, Drax
retains power to be sold into the prompt (within season) power markets.

As at 25 June 2007 the contracted position for 2007, 2008 and 2009 was as
follows:

                                             2007           2008          2009
                                           --------         ----          ----
Power Sales - TWh                            21.4           15.4          10.0
comprising:
 - Fixed price TWh at an average             20.1           10.1           4.7 
   achieved price per MWh                at £46.4       at £46.5      at £38.9
 - Fixed margin TWh (note)                    1.3            5.3           5.3

CO2 emissions allowances hedged
(including UK NAP allocation,
market purchases and structured
contracts) - TWh equivalent                  22.5           16.9          17.3

Solid fuel at fixed price /
hedged (including structured
contracts) - TWh equivalent                  23.1           15.9          13.0


The contracted position for CO2 emissions allowances includes the annual
allocation made under the EU Emissions Trading Scheme, market purchases and
allowances due to be delivered under the terms of the Centrica contract (note).
The position for solid fuel includes estimated deliveries due under fixed price
contracts and the coal volumes specified under the terms of the Centrica
contract the terms of which effectively remove the risk from Drax of price
movements in respect of that coal.

Drax will provide the next update on its contracted position in its 2007 
Interim Results Statement expected to be issued on 6 September 2007.

Distributions to Shareholders

The Board has previously stated that the Group will pay a stable amount (£50m)
by way of ordinary dividend each year (the base dividend) subject to the
availability of cash and appropriate reserves. In addition to the base dividend,
the Board has also stated that substantially all of any remaining cash flow,
subject to the availability of reserves and after making provision for debt
payments, debt service requirements (if any), capital expenditure and other
expected business requirements, will be distributed to shareholders.

The Board expects to declare an interim ordinary dividend and a special
distribution in respect of the six months ending 30 June 2007 with the 2007
Interim Results. The Board continues to keep under review the most appropriate
method for making special distributions. The level of special distribution will
take account of the closing cash position, the working capital, capital
expenditure and any other needs of the business, and the interim ordinary
dividend of approximately £17m. Drax expects that the closing cash position as
at 30 June 2007 will be in the range £160m to £165m. Working capital and 
capital expenditure needs will be impacted by the planned outages on two of 
the Drax generating units and the capital expenditure programme. Payments 
relating to each of these are weighted towards the second half of this 
financial year.


Note:

Fixed margin power sales include approximately 1.3TWh in 2007 and 5.3TWh in 
each of 2008 and 2009 under the five and a quarter year baseload contract with
Centrica which commences on 1 October 2007. Under this contract Drax will 
supply power on terms which include Centrica paying Drax for coal, based on
international coal prices, and delivering matching CO2 emissions allowances
amounting to approximately 4.7 million tonnes per annum. The contract provides
Drax with a series of fixed dark green spreads which was agreed in the first
quarter of 2006.


Enquiries:

Chief Executive: Dorothy Thompson
Finance Director: Gordon Boyd
[phone]

Drax Investor Relations: Andrew Jones
[phone]

Media:

Drax External Relations: Melanie Wedgbury
[phone]

Tulchan Communications
David Trenchard and Peter Hewer
[phone]

Website: www.draxgroup.plc.uk





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