Drax has won a legal case against the Government over subsidies for its power station units.

The High Court ruled that one of its coal-to-biomass conversion projects was eligible for support under the Department of Energy and Climate Change’s (DECC) new renewable energy subsidy scheme.

Drax decided to take legal action after DECC said only one of the two power generating units the company wanted to convert was eligible for an early investment contract under the Contracts for Difference scheme.

The company said in a statement: “The Court has made a declaration that the second unit conversion was indeed eligible for an Investment Contract.”

DECC said it would now consider the court’s permission to appeal against the decision.

A spokesperson added: “We believe that we ran a fair and robust bidding process for renewable generators seeking early Contracts for Difference. We have been granted permission to appeal and will now consider the decision carefully.”

Last week the High Court also ruled in favour of 14 solar energy firms in a £132 million damages claim against the Government.