Drax has converted half its power plant in Yorkshire in the north of England that was once Europe's most polluting coal-fired power station to burn wood pellets, often made from sustainably sourced dry sawdust compressed under high pressure.

Drax said it would complete work on the fourth unit conversion in the second half of this year as part of a major planned outage, before returning it to service in late 2018.

"The capital cost is significantly below the level of previous conversions, re-purposing the existing co-firing facility on site to deliver biomass to the unit," the company said in a statement.

The unit will likely operate with lower availability than the other three biomass units but would run at periods of high demand, it added.

(Reporting by Nina Chestney; Editing by Edmund Blair)